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Insiders Predict What's Next After Big Shock-Waves In Digital Ad Arena

This article is more than 6 years old.

Major brands have definitely taken a hit lately when it comes to digital advertisements. Call it the era of the immediate take-down. We have seen rapid about-faces of brands such as a certain beverage manufacturer and airline carrier who spent significant sums on their own digital ad content creation only to have to hit the delete button after public out-cry of corporate insensitivity to race, gender and more.  But self-inflicted creative faux-pas are not the only landmines.  Just recently major mobile carriers and many others created a mass exodus from the YouTube platform at the mere suggestion of being positioned near anything that is considered even remotely politically incorrect.  Let's face it, we are living in a time of heightened cultural sensitivity that is being slammed against a raw, glaring spotlight that is the definition of digital platforms, and the two do not always mix well.   Particularly when it comes to the Millennial influencer who is, for the most part, digitally savvy, very vocal and very aware of today's cultural shifts, combined with a general lack of trust in anything "establishment." Thus, in a world where it’s all about the digital connect with consumers, how will brands actually navigate the new cultural and technological fault lines, and  what will it take to win?

Indeed, some are already predicting the demise of the digital ad arena just on behavior patterns, alone. In fact, a recent report from Forrester Research actually warns that the digital, click-based ad market may become so disrupted that it could actually cost Google and Facebook roughly $3 billion, as advertisers move toward safer, more collaborative actions rather than the traditional scenario.

According to the study from Forrester’s James McQuivey, "consumers’ desire to get away from distracting display ads, which often interrupt reading or browsing and can slow down computers is a factor in a move toward corporations reevaluation of their strategies."

“[Chief marketing officers] know this already, but nobody wants to talk about it, even though advertisers wasted $7.4 billion on poor-quality ad placement in 2016 alone,” McQuivey wrote. “Digital accounts for a third of all ad spend in the U.S. because it’s supposedly so effective. Yet display-ad click-through rates hover around 0.35 percent; only 40 percent of ad spending is viewed by a real human; and ad blocking is rising around the world. But if we can persuade the top 10 U.S. advertisers to shift just 10 percent of their ad budgets to branded relationships, it will cut $2.9 billion from the current ad business."

That is a significant number, but some experts think this issue is more complex that McQuivey's analysis and that culture does, in fact, matter.  Indeed, Ezra Kucharz,  former President of Digital Media at CBS, sees the digital landscape a bit more widely.  "Marketers have always needed to be careful about which brands they associate their brands with," Kucharz explains. "Being in-authentic or having a marketing campaign that is out of context are only two of the risks that can tip the balance in digital ad attraction.  In the convergence of brands and digital media these risks can be further amplified when marketers buy online media via networks, programmatic channels or digital properties without specific placements.  Typically, this media is purchased via audience segment and not specific sites.  When this occurs the marketer rarely know what type of content or page their ad will end up on.  While these ad platforms offer great efficiency and reach, they can pose an issue if a marketer wants to be protective of their brand."

He continues, "But digital marketing isn’t going anywhere.  The data and reach provided make digital platforms a great solution for most marketers.  Many marketers are simply requiring partners to put parameters in that prevent this from happening.   While a full-scale advertising boycott was threatened against YouTube it never materialized.  A few 'blue chip' advertisers did pull their advertising but it didn’t not occur on scale, and we'll simply see brands police themselves more when it comes to creating their content."

But Jen Cherniske, Vice-President of Marketing at Freestar.io isn't so sure there is not major cause for alarm. "I actually think we've hit a tipping point with digital advertising where, after years of the industry evolving, brands were able to align with the biggest cultural moments in more creative ways than ever before - practically in real time, and with great precision. There were thousands of new sophisticated ways for brands to target any topic or consumer they pleased, and many brands got so caught up in the beauty of that, that they took their eyes off the ball in terms of monitoring brand safety."  She continues, "I think many assumed the large players in the space who they entrusted with their brand had their best interests in mind. The truth is, though, the Googles and Facebooks of the world were riding high and took their eyes off the ball too, so suddenly, aligning with of-the-moment cultural conversations and targeting consumers who were devouring this content, got risky.  Brands (and agencies, publishers, and vendors) dive head first into new platforms because the objectives they're trying to reach are becoming more aggressive, and new platforms hold new promise. We don't fully realize the downfalls until we're fully immersed."

But she adds, "Let's be honest: brands who are pulling their budgets from YouTube aren't doing that long term. They need the platform. What they're doing is exerting their strength and forcing the industry to tighten up their game, which did need to happen."

One gets the sense that there is a lot of internal scrambling given that the convergence of such terrains is new and rather unforgiven. " For sure the recent strains in the industry are causing major confusion, but also creating opportunity by forcing marketing to ask hard questions," says Rob Griffin, Chief Innovation Officer at Connelly Partners. "The focus on quality, insight, smart decisioning is changing how marketers work with agencies, publishers, consultants, everybody."

RC Williams, Founder of Ethos echoes Griffin's sentiment, "The situation is a culmination of an issue that's been bubbling under the surface for a long, long time. Brands are now having, in a sense, a 'looking glass' moment, where the power to deliver highly targeted digital messages to consumers, and stay with them, exists, but they have not received proper guidance from digital experts, agencies, and others  neither internally nor externally on how to best utilize them." He continues adding an intriguing insider note, "So, the vibe inside of the industry is a mix of optimism, opportunity and panic. Digital advertisers and brands are also making moves and shifting budgets from larger agencies to more boutique firms, who can provide high touch guidance and campaign ideas that take advantages of deeper personalization opportunities with digital advertising so there is real change ahead."

Kucharz believes the key to future navigation of such change is simply buying specific placements on  specific sites. "Additionally, a “white list” approach with vetted sites is a much safer approach," he says.

However Cherniske has an interesting view in the midst of the chaos. "As brands are shifting their budgets due to these safety issues, niche and premium publishers will finally have an opportunity to get back on top for a little while," she muses.  "We work with hundreds of niche websites, and they're actually flourishing because their content is being produced and edited by a handful of experts. They're offering the highly concentrated content and audiences brands want, but they can also offer the safety that many enormous players have simply proven they can't."

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