Now’s the time to future-proof your advertising playbook by experimenting with privacy-friendly channels.
The tried-and-true approach to advertising is undergoing a major transformation. Meta and Google’s duopoly is losing steam. Privacy legislation and Apple’s iOS updates are changing the data playing field. And marketers are looking for better ROI across their channels.
Marketers are adept at change. So look at these shakeups as catalysts for future-proofing your advertising playbook, getting more bang out of your marketing buck, and setting yourself up for long-term growth.
Here's your CliffsNotes guide to the biggest conversations happening in marketing right now. Send this piece to your team, and continue to keep the pulse on these trends:
- Google’s and Meta’s duopoly is weakening as marketers experiment with innovative players (including Amazon, Snap, TikTok, Apple, and Microsoft) to acquire shoppers.
- The old ways of personalizing experiences are disappearing. Today, 30% of ad inventory is non-addressable, and it’s expected to hit 75% by 2024. Plus, Apple’s IDFA changes have made ads more expensive and less efficient. Marketers need to increase their investment in first- and zero-party data to power their next era of personalization.
- Along with continued iOS updates, potential federal legislation could create uniform privacy protections for consumers (based on GDPR and CCPA). Marketers have the runway right now to shift their spend towards channels that’ll set them up for their next phase of growth. These channels will share a few characteristics: deep personalization, geotargeting capabilities, and a first- and zero-party data moat that’ll help them quickly adapt to future privacy requirements.
Your future success will depend on investing in privacy-friendly channels—and proving their ROI
30% of ad inventory today is non-addressable, meaning it’s much harder to target consumers and measure conversions. That portion is expected to hit 75% by 2024 as privacy updates from both the private and public sectors kick in.
As a result, the channels that’ll set you up for your next phase of growth will have a few characteristics in common:
- Transparent data collection, driven by the consumer (like sharing preferences through quizzes)
- Personalization, primarily powered by first- and zero-party data
- Geo-targeting capabilities to engage local markets
Basically, you’re looking for channels that deliver privacy-friendly personalization. They’ll help you build a moat to protect your brand against new privacy requirements and declining ad performance.
You may be asking, “What’s the hurry?” Google delayed their third-party cookies plans again. And you’ve already got a lot on your plate—acquisition is getting harder, and you’re doing more with less. It might not feel like the best time to experiment with new channels or move your budget around. But, right now, you have the runway to shift some of your spend towards experimental channels that aren’t exposed to risk.
What are the mobile advertising trends reshaping performance marketing?
The shakeup in the advertising industry is a result of a few intersecting trends: an increased focus on privacy, the declining performance of gold-standard channels, and the start of an economic slowdown. But these challenges are also serving marketers with opportunities to diversify their strategies.
Meta and Google’s duopoly may soon be a thing of the past
The two industry titans have traditionally held more than two-thirds of the advertising market. Their shares are decreasing, though, and there are a couple of key factors at play.
First, the global economy is cooling off and brands are tightening their budgets in response. Second, acquiring new business to make up for shrinking ad spend isn’t an option for Meta and Google anymore. They’re losing ground to challengers like Amazon, Snap, TikTok, Apple, and Microsoft, who now take nearly a quarter of all digital ad spend.
It may not sound like a lot, but gaining that much ground after a decade of Meta and Google holding almost all of the market is an impressive feat. Plus, their competitors’ shares are only expected to keep growing through strategic partnerships and owned networks.
Apple recently announced they’re working on their own ad network. Microsoft is partnering with Netflix on the streaming giant’s new ad-supported tier. And as eyeballs move to TikTok, marketers are following. DTC brands spent 231% more on the platform in Q2 than they did last year.
Apple’s ID for Advertisers (IDFA) changes have made ads more expensive and less efficient
Apple assigns each iOS device a unique identifier (called an IDFA) so advertisers can track their mobile campaigns. But the company’s iOS 16 updates and App Tracking Transparency tool recently made it more difficult to measure performance by granting consumers more control over their data.
Now, Apple prompts users to opt out of sharing their data with apps that track their behaviors and pass the insights on to third-party vendors. 75% of users have opted out, significantly decreasing marketers’ ability to match clicks to purchases on their mobile ads.
When you’re getting creative with a leaner budget, it’s harder to justify spending more money on channels that aren’t growing at the right pace (or can’t be accurately measured). As a result, Facebook’s revenue is down year-over-year for the first time ever. Once a sure bet, Facebook’s performance decline signals a tectonic shift in the digital advertising space.
Preparing for more change on the horizon
Legislators are debating whether to create uniform federal advertising and privacy regulations that would protect consumers no matter where they live. These laws are a good thing for marketers, too. Consistent privacy legislation would take the burden off marketers to meet different states’ requirements.
Most brands had to scramble to align their strategies with the initial major privacy laws. First, the EU’s General Data Protection Regulation (GDPR) made waves, spurring the shift towards cookie-consent pop-ups abroad. Soon after, the California Consumer Privacy Act (CCPA) rolled out broad rights for California residents.
And the movement towards protecting consumers’ privacy isn’t slowing down. On January 1, 2023, California will expand on the CCPA with the California Privacy Rights Act (CPRA). The new law will regulate how brands share data, giving consumers control over whether brands can share or sell their data to other companies, including for certain advertising purposes. California also created a new enforcement agency to create and enforce new requirements.
And now, with even more legislation in the works, brands have the opportunity to be on the offensive. You can get ahead of future changes by taking a few easy and strategic steps:
- Update your website: Add components to your website to compliantly collect zero- and first-party data and deliver more personalized experiences. Product-finder quizzes, live SMS chat support, and fit guides help your customers make informed purchase decisions and give you the data you need to tailor future interactions.
- Revamp your data collection strategy: Do a quick audit of where you’re collecting first- and zero-party data, from the moment a shopper comes to your site to the channels you use to bring them back. Fill the gaps—for example, collecting product preferences through conversational text messages—and integrate your data across your digital channels.
- Invest in privacy-friendly channels: Channels that let you collect and act on first- and zero-party data are your golden ticket to long-term growth. Loyalty, SMS, and email programs let you engage with shoppers directly, and transparently gather actionable data.
Meta and Google ads aren’t going anywhere. They’re major pillars of your digital growth strategy. But you need to diversify sooner rather than later so you can weather whatever changes lie ahead—and continue to stay top of mind with shoppers.