The Coming Challenges and Opportunities for Digital Advertising
The digital advertising landscape in 2024 is poised for significant evolution, shaped by technological advancements, shifting consumer behaviors, and emerging regulatory trends. As we look toward the coming year, these are the trends that are set to redefine the industry.
AI Integration
A pivotal trend for 2024 will be the mainstream adoption of artificial intelligence (AI), particularly generative AI. Businesses and individuals alike increasingly leverage AI to automate various aspects of life and work; in advertising, this will take the form of creative decision-making and media planning. Advertisers will use AI to create more nuanced and effective audience-targeting strategies. This movement aligns with the growing sophistication of consumer-facing AI tools, which are being used by the public to simplify purchasing decisions. For instance, AI can now recommend and package personalized travel options based on specific preferences, like a preferred airline, hotel amenities, and cost.
The intersection of marketer-utilized AI and consumer-used AI tools represents a significant commercial opportunity. Marketers who effectively integrate AI to connect with consumers using their own AI tools will find themselves at a competitive advantage. This synergy between AI-driven marketing and consumer habits is set to become a cornerstone of digital advertising strategy.
Streaming and CTV Dynamics
2024 will likewise witness the continued rise of streaming TV and connected TV (CTV). In 2023, streaming overtook linear TV in viewership, a trend that's expected to persist as more households move to virtual MVPDs (vMVPDs) or cut cable entirely. This shift has led to audience fragmentation, making it challenging to reach mass audiences outside of live sports events.
Broadcasters are responding by creating new "water cooler" content and stunts aimed at attracting live or near-live audiences. Post-writers-strike, Hollywood is already pivoting to meet this demand. However, not all platforms will succeed in this fiercely competitive space. The coming year will likely see a consolidation in the streaming industry, with platforms like Paramount+ and Peacock under pressure for relevancy as households limit the number of streaming services they subscribe to.
Privacy, Data Ownership, and Legislation
Privacy concerns are moving from local discussions and state regulation to a national conversation about data ownership and the right to avoid tracking. The acceleration of cookie phase-out in Google's Chrome browser and frequent data breaches have pushed elected officials to consider a privacy-first approach. This shift in the political landscape will likely influence campaign messaging, focusing on consumer protection. However, it remains to be seen whether these officials will adhere to privacy-compliant practices in their own advertising strategies.
Evolving Measurement Standards
The debate over unified measurement standards across TV, digital, and social media will intensify in 2024. More agencies are expected to move away from traditional metrics like those provided by Nielsen, opting for alternative currencies that offer a more holistic view of consumer engagement. Attention measurement has gained traction to assess inventory quality and understand performance drivers more accurately. This shift signifies an industry-wide effort to develop more relevant and effective ways to measure advertising impact across various platforms.
As we look ahead to 2024, the integration of AI into both the creative and operational aspects of advertising, the evolving landscape of streaming and CTV, heightened privacy concerns, and the shift toward more nuanced measurement standards are shaping a new era in digital advertising. These trends underscore the industry's adaptability and continuous evolution in response to technological advancements and changing consumer preferences. For advertisers and marketers, staying abreast of these trends will be crucial for success in this dynamic environment.
The views and opinions expressed are solely those of the contributor and do not necessarily reflect the official position of the ANA or imply endorsement from the ANA.
Brian Danzis is president of North America at Seedtag.