The Spirit Of Digital Advertising

Michael Hedges June 2, 2021 Follow on Twitter

Advertising people are fixtures of positivity. It is an occupational necessity. They find blue skies and rainbows in every moment. The coronavirus put a slight dent in that. But only slightly.

Digital advertising remains where the action is. Everything about it appeals to advertising creatives, media buyers and, usually, their clients. It’s very fast moving, another appealing feature for ad people. Most importantly, digital advertising keeps growing. Non-digital advertising has disappeared from view, literally and figuratively.

IAB Europe recently released highlights of its annual AdEx Benchmark report on ad spending for 2020 across 28 European markets, Portugal and the Baltics states not included. “Digital advertising did not have a bad year in 2020, only a bad quarter,” wrote IAB Europe chief economist David Knapp in a statement (May 25). The “bad quarter” was Q3. “The events of 2020 have fast-forwarded long-term socio-economic transformations that are altering how people consume and how companies operate. This provides a fertile ground for digital advertising and we expect the sector to accelerate its growth in 2021.”

Across the region 2020 digital advertising spending rose 6.3% to €69.4 billion. This is a slip downward from the 2006 to 2019 average annual growth rate of 19.5%. Digital advertising now comprises 56.5% of all ad spending. Per market growth year on year accelerated most in Eastern Europe - Ukraine, Serbia, Czech Republic, Bulgaria and Romania - with Turkey leading (34.8%). The UK has the highest digital share of all advertising as well as (by far) highest digital ad spending, more than twice German’s digital ad spending, which ranked second. IAB Europe expects digital advertising growth in 2021 at 9.8% over 2020 to €76.2 billion.

Coronavirus economic disruption cannot be minimized. Historically, ad spending has lagged consumer spending and, more broadly, national gross domestic product (GDP). Advertisers spend on sales messages when they know - or feel strongly - consumers and businesses are ready, willing and able to let loose of that cash. Consumer confidence surveys are, therefore, widely watched. By several accounts, such as the May INSEE consumer confidence poll in France, the public is feeling a bit more confident but, still, not as much as in 2019.

Raising anxiety in ad land is the existential threat to programmatic ad sales (read: bots), loved for being fast, targeted and cheap. Digital privacy rules are popping up to disrupt the fun by curtailing the use of third-party cookies, bits of code installed on personal digital devices that relay great gobs of fascination and useful information to marketers. With programmatic ad sales the significant driver of the digital ad business, no cookies could be a bad day. Some in ad land refer to this as “cookiepocalypse.” In Sweden they call it “cookiedöden” - cookie death.

Responding to various pressures, not least from consumers, Google then announced in March its Chrome browser would no longer collect third-party cookies by 2020. The Safari (Apple) and Firefox browsers had already included limits on data collection by cookie on updates. But Google’s Chrome is used by two-thirds of the world’s internet-enabled devices. Apple has turned privacy into a product feature.

Advertisers and the ad people they support have pursued more and more granular targeting for years. Putting a specific message in front of a specific individual at a specific moment and place is advertising nirvana. Cookie tracking does that. Nothing else satisfies.

“Change is hard,” said Google Americas president Allan Thygesen to The Drum (June 1), hoping to assuage the panicked ad people. “Everybody was so excited about this nirvana of being able to track every action along the journey and finally get to the promised land, from a marketing perspective, of fully attributed multi-touch attribution. It’s going to be hard. I’m not sure we’re going to fully get there.”

See also...

• Hot Topics - Ad Spending

• Hot Topics - Digital Advertising

• Hot Topics - Google/Alphabet/YouTube

• Hot Topics - Privacy

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