This week's blog post is contributed by Cory Treffiletti, VP Marketing, Oracle Data Cloud.
It’s that time of year again. Time for friends, family and forecasting! It’s the time of year when people try to anticipate what will happen in the coming year based on what they’ve seen in recent months.
For me, I don’t like to call these “predictions” as much as “educated guesses”, so here are my “educated guesses” for what I think will happen in the space of data-driven marketing in 2016.
There are two ways to look at how people will buy data in 2016. On one side, the CPM’s for data are increasing while CPM’s for basic digital display are decreasing so at some point its possible the data may actually be more valuable than the media.
This feels a little extreme. What’s more likely is the industry will come to realize that media without data has little to no value and that data will drive the value in online media, meaning any potential increases in publisher revenue growth will come as a result of data-infused media.
There are no current benchmarks in place to reference, but there are still lots of advertisers doing performance-based campaigns with no data associated. The “spray and pray” model of untargeted advertising still exists but publishers cannot live on that model of monetization.
As display advertising becomes more data-driven, or at the least targeted using data, CPM’s will rise and they will sell more of the valuable, “premium” media.
This translates to fewer and fewer untargeted, performance based buys and an increase in the share of data-driven impressions. If this trend continues, advertisers may be dictating that close to 100% of their campaigns need be data-driven or data-infused.
That means the true value of the impression will lie in the data as much, if not more than, simply the delivery on a page. Data targeting + context is extremely valuable, but data targeting by itself can create a highly effective campaign.
Just look at the success of retargeting as an example; Retargeting exists in non-contextually relevant environments and this signals the direction of the industry, especially as the tactic crosses over into video and non-linear TV.
Not everyone agrees with me on this, but I think the volume of consolidation will slow down in ad and marketing tech.
This is going to be an interesting year driven by an election cycle, and elections bring uncertainty. I think uncertainty breeds mistrust and only the top 20-25% of the industry is going to be targeted for M&A, leaving the bottom 75-80% either stuck in a situation of “thrive” or “barely survive”.
Political spending will be all over the place and if publishers are able to tap into that stream or the Summer Games spend, they will thrive. If they cannot, they will barely survive, if survive at all.
The fragmentation and clutter around spending in our industry has to simplify and an election year is exactly the right year for this to happen.
My opinion seems to be supported by the uncertainty around Yahoo right now as Yahoo is typically one of the leading M&A drivers, but with their future in doubt a strong player could be taken off the table in 2016.
This can be seen as a cop-out in terms of an educated guess, but I’ve now worked through many election cycles in the Internet age and election years almost always create a slowdown in disruption.
Things don’t change in an election year – they change the year AFTER the elections. Election cycles are about promises and debates.
There are promises made and predictions prognosticated, but things rarely change until the new leaders are in place and those promises are delivered upon. In a year such as this, it’s foolish to predict massive change.
For our industry that means data will continue to become more important. Marketers will continue to become more accountable.
Technology will play a greater role in marketing. Dollars will continue to shift from TV to digital, and agencies will continue to evolve around digital strategy and digital engagement. The same buzzwords will be thrown around and the same arguments around ad blocking will be discussed.
The status quo will allow us to continue to get better at what we do in an iterative fashion, and enable us to become better, tighter, stronger and more effective partners for marketers. I for one see this as a fantastic opportunity. Don’t you?
Photo: everything possible/Shutterstock