Industry experts on the trends you need to know for 2023: Part 2

In this article, we continue with our trends for 2023. Read part 1 here for more background on this series.

1. Prepare for more data privacy regulations

Privacy and compliance laws, regulations and guidelines are top of mind for advertisers as we go into 2023. Current business practices have mostly been shaped by Europe’s pioneering guidance, GDPR alongside California’s CCPA. However, the industry is watching Japan, Australia, Brazil, Colorado, Connecticut, Utah, Nevada and Virginia, who all have their own laws to protect consumer privacy over the world-wide-web, the metaverse and beyond. While currently there is no universally accepted industry standard for protecting consumer privacy, several organizations, including the IAB are working on coming up with guidelines to standardize best practices.

With new privacy laws coming out in some states, the value of permission-based data (like we use for our acquisition email services) will continue to shine.  Those new laws could make it harder for companies to execute true 1-to-1 programs where you have detailed insights into the audience that’s seeing your ads and with our data being ‘permission-based’, that helps overcome some of those challenges.

What will work the best over the long term? “Fostering consumer trust,” says Sal Pecoraro. “Consumer trust to hand over their data, aka ‘consumer opt-ed in consent,’ is the key to the long-term success of addressability and measurement.”

2. The rise of zero-party data

There are four types of data marketers lean on – zero-party, first-party, second-party and third-party. With the deprecation of the 3rd party cookie, which Google warned us is happening at the end of 2023, many advertisers are looking to shore-up their first-party data. This is a great strategy and one that comes highly recommended by our James Purtle.

However, Kara Alvarez urges brands not to sleep on zero-party data, even as the amount of data companies need to collect increases. “Going into 2023, we will see a focus on zero-party data collection, and data collection in general to manage all the data that brands may now be forced to collect.”

Zero-party data is generated by consumers directly interacting with surveys, preference centers, polls and questionnaires – essentially any format where they can share preferences and motivations or spending habits in return for better personalization or another benefit. Zero-party data is an area of missed opportunity for many brands as it offers unique benefits:

• Highly reliable – Explicit interest handed over by customers is more reliable than implied interest based on activity history or other data points.
• Efficient – Zero-party data means marketers can simply ask for insights which is a quicker and more economical way to generate insights.
• Low cost – Can be free or low-cost (if you know how to collect it).
• Privacy friendly – Consumers exercise complete control of their data by sharing their opinions and preferences directly with a brand.

Sal Pecoraro also weighed in on zero-party data, “My two college age kids focus their time on Snap Chat, TikTok and Instagram and there also seems to be a lot of participation in online polling and surveys. This is definitely something advertisers need to keep on their radar.”

3. CTV will continue to see its star rise

“My crystal ball broke last night,” joked Dan Babb. “I think we’ll see continued growth in CTV and digital overall…but that’s been growing every year.” And he’s right – since the start of the 2020 pandemic, CTV and OTT streaming services have breathed new life into the advertising space. With more and more consumers ‘cutting the cord’ and moving to streaming, advertisers have been evolving their marketing strategies to take advantage of this frontier. With streaming giants such as Netflix and Disney+ newly launching commercials, advertisers need to get in front of this trend before the best inventory is snatched up.

“CTV is a great channel, and not just because it’s been steadily growing in popularity,” says Kara Alvarez. “It allows for a higher quality of targeting, has a more efficient planning and buying processes and transparent measurement – and we know measurement is always top-of-mind.”

4. The popularity of retail media networks will continue to skyrocket

If you aren’t familiar with retail media networks, now is the time to catch up. Our James Purtle predicts that retailers such as Amazon, Walmart, Target, and even Home Depot will lead the charge as we head into 2023. Retail media networks (RMN) deliver improved targeting, provide new audience insights, and provide more relevant and valuable shopping experiences for consumers. Amazon pioneered retail media when they launched their network in 2012 and according to a recent Forbes article, Amazon generated more than $31 billion in ad revenue in 2021, up 32% from 2020.

The RMN space is becoming increasingly more competitive. Many major retailers have recognized the winning opportunity to monetize their shopper loyalty program data and have launched their own retail media networks (RMN) including: CVS, Lowes, Target, Kohl’s, Walgreens and Kroger. RMNs have the potential to generate over 1.3 trillion of enterprise value in the United States alone, and nearly 70% of advertisers say their RMN spend showed better returns than their spend on other channels.

“There is no doubt that measurable ROI is inspiring advertisers to adjust their media strategies amid the proliferation of e-commerce media options,” says our Lisa Moore. “Ad dollars have been moving to RMNs at a significant pace. Retail trade dollars are shifting, programmatic display budgets are shrinking and the incremental growth of measurable media budgets are feeding this trend. In fact, eMarketer forecasts that US Retail Media Networks will exceed $52 billion in ad sales by 2023.”

“It’s easy to see why retail media networks are taking the advertising world by storm, especially as we move closer to the end of Google’s third-party cookie. This channel is pretty cookie-resilient. It’s only going to become more competitive to enter into this space, and advertisers need to have a comprehensive strategy to make sure they reach their audience.”

5. The industries that will shine in 2023

Our Kara Alvarez predicts the hospitality industry will shine in 2023, as consumers who put off travel for the last few years get out of the house and into the world. Dan Babb is hoping things turn around for the automotive industry, who have had to contend with supply chain shortages for the vast majority of 2022. Sal Pecoraro thinks the political sphere will stand out in 2023, “with the 24/7 news cycle and the country so divided, it seems like political campaigns start earlier and earlier. Even though it’s two years away, the focus on the next election has already begun. Industries that focus on political ad campaigns, polling, and fundraising will have a good year.”

Reacquaint yourself with our experts

Keep your eye on this space for more of our trends and predictions for 2023! Or contact us to discuss how you can shore-up your 2023 plans.