Why the Demise of the Google/Meta Ad Duopoly Is Good News

Why the Demise of the Google/Meta Ad Duopoly Is Good News

Google Meta Walmart

Recently there’s been some considerable discussion about the demise of the so-called advertising duopoly. This refers to the speculation that Google’s and Meta’s dominance of the online advertising industry is fading as their share of online advertising shrinks. As reported widely, Google and Meta are expected to bring in less than half of all U.S. digital advertising in 2023 for the first time since 2014. Here’s what the number say:

  • Google and Meta will together capture 48.4 percent of all U.S. digital ad revenue in 2023 — 28.8 percent for Google and 19.6 percent for Meta — down from 54.7 percent at their peak in 2017, when Google’s ad revenues account 34.7 of the market, and Meta accounted for 20.0 percent. per data from Insider Intelligence.

But let’s not shed any tears for Google and Meta. They are doing just fine. Google generated an astounding $282 billion in advertising in 2022. And Meta, following a difficult 2022, is rebounding strongly as the business shifts its advertising model from tracking third-party cookies to first-party customer data.

No, the duopoly isn’t fading, exactly. But the online ad world is getting more crowded. For instance:

Amazon Ads is nearly a $40 billion business.

  • TikTok is expected to earn $8.6 billion in ad revenue in 2024 – assuming TikTok doesn’t get banned in the United States.
  • A host of retailers ranging from Walmart to Walgreens have entered the online advertising, business. They’re using Amazon Ad’s blueprint: tap into the consumer behavior data they collect from their own customers (known as first-party data) to develop targeted ad products. Retail media at the global level is forecast by WARC to be the fastest-growing marketing channel this year, reaching $122 billion in revenue.
  • Several companies outside of retail such as Airbnb and Uber are doing the same thing with their first-party data as retailers are: developing ad businesses. They’re smaller, but they are significant.

The growth of Walmart’s ad division, Walmart Connect, is an example of how varied the online advertising world has become. Recently Walmart said that Walmart Connect grew 41 percent year-over-year in the fourth quarter of 2022. Its ad operations were up 20 percent over the period and jumped nearly 30 percent in 2022, generating $2.7 billion for the full year.

Walmart enjoys a significant advantage: it operates a strong eCommerce business to complement its mammoth chain of retail stores. This gives the company a large audience online and offline to develop and deliver targeted ads. During the runup to Black Friday during the 2022 holiday season, Walmart even enjoyed stronger search traffic than Amazon did.

Walmart has developed several ad units. They include:

  • Search to make products found on Walmart’s digital sites such as Walmart.com.
  • Display on Walmart’s site and across the web.
  • In-store to make a brand visible on digital ads in Walmart stores, such as in self-checkout lanes, or as a “commercial” on in-store TVs adding to the number of replacements for linear TV.

A number of businesses, such as Kraft Heinz, report improvements in sales lift by working with Walmart on ad campaigns across Walmart properties.

The rise of alternatives to Google and Meta is good news for businesses for a few reasons:

  • More competition gives advertiser more choice. The rise of retail networks is a good example. Businesses can tap into more refined first-party data from each retailer to target different audiences. For instance, the Macy’s media network gives advertisers entrée to a more style conscious consumer.
  • More competition means that Google and Meta need to improve their own ad products. For instance, the popularity of TikTok has forced Meta to develop short-form video content, Reels, with ad products to go with them.

We suggest advertisers capitalize on the proliferation of ad platforms wisely. Focus on the platforms that provide the strongest ROI while experimenting with emerging platforms that are aligned with an audience you have been wanting to reach (e.g., TikTok for Gen Z) and channels that are untapped to you.

At True Interactive, we can help. We possess experience with both the established ad platforms and emerging ones. Learn about our services hereContact us to learn how we can help you.

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True Interactive Named a 2023 Google Premier Partner

True Interactive Named a 2023 Google Premier Partner

Google

One of the ways True Interactive advocates for our clients is by forming strong relationships with the leading ad tech companies in the world. And Google is certainly one of them. Google commands the largest share of the online advertising market. The company generated an astounding $282 billion in advertising in 2022. We maximize the value of our clients’ ad spend on Google, and doing that gives us deep knowledge of Google. So, we are pleased that True Interactive has been recognized as a Google 2023 Premier Partner.

“Partner” is more than a general description of a company that works with Google. To Google, the word has a specific meaning. Becoming a Google Partner means that your company is recognized for maximizing campaign success for your clients, driving client growth by maintaining clients’ campaigns, and demonstrating Google Ads skills and expertise with certifications.

Google says we are in the top three percent of its partners. The top three percent is evaluated on an annual basis and is determined by a number of factors, including but not limited to: client growth, client retention, product diversification, and annual spend. This means we enjoy a number of benefits that make us a more knowledgeable ad agency, such as:

  • Product betas: access to the most current product betas through ongoing, summarized reports.
  • Insights briefings: the latest insights from Google to stay ahead of changing consumer behaviors and industry trends.
  • Promotional offers: Google Ads credits, which we apply to the benefit of our clients.
  • Invite-only industry events, such as roundtable discussions with Google leaders, sessions with other Premier Partners, and opportunities to hear from industry thought leaders.

We are honored to be Premier Partner. Thank you to Google, our clients, and to the incredibly talented team at True Interactive that turns insights from Google into a better experience for our clients.

Contact True Interactive

We help our clients succeed with online advertising. Learn more about our services here and our work here. And contact us to learn how we can help you.

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How Meta Is Rebounding

How Meta Is Rebounding

Meta

Meta is back.

The company’s market capitalization lost considerable value in 2022 after failing to meet its financial targets. A costly investment into the emerging metaverse has been ridiculed. But Meta is showing signs of a much brighter 2023.

The Wall Street Journal recently reported that:

  • The company’s investments into artificial intelligence (AI) have helped Meta improve ad-targeting systems to make better predictions based on less data.
  • Meta’s short-form video product, Reels, is becoming more popular on Meta’s core Facebook and Instagram platforms.
  • The development of ad products based on user data from Meta’s own platforms is easing the blow of Apple’s privacy restrictions. Those restrictions, focusing on ad products that rely on third-party user data, had forced Meta to retool its ad strategy away from third-party user tracking to first-party data (the information that Meta gains from users from its own platforms such as Facebook and Instagram).

Reels Gains Traction

All of these developments are noteworthy. For instance, Reels is Meta’s answer to TikTok, whose dramatic rise, based on short-form videos, has threatened Meta. So, more user engagement with Reels should attract more advertisers.

The Wall Street Journal said that Tom Alison, head of Facebook, wrote in a memo to staff, “Facebook engagement is stronger than people expected. Our internal data indicates that Meta has grown to a meaningful share of short-form video.” And on Facebook alone, Meta can count on a large, engaged user base.

Facebook engagement

Reportedly, Meta has credited improvements to both Facebook’s algorithms and the computing systems on which they run, resulting in a 20 percent gain in time spent in Reels consumption. This is quite a turnaround from summer 2022, when Meta was still struggling to get users to embrace Reels videos.

More Effective Ad Products

Meta suffered a blow in 2021 when Apple introduced privacy controls that resulted in people opting out of having their online behavior tracked while using Apple products. This was a problem because Meta’s ad products rely mostly on tracking people across the web via third-party cookies. The privacy controls have forced Meta to do a better job building ad products based on user behavior on Meta’s own platforms (which Apple’s privacy controls do not affect).

Meta estimated last February that the Apple change would cost it more than $10 billion in lost sales for 2022, equivalent to about 8 percent of its total revenue for 2021. At the time, the news caused Meta’s stock price to plummet.

But Meta is gaining traction with new ad products. For instance, Meta’s broad targeting ad program consists of an automated targeting approach that reportedly produces better results for Facebook and Instagram ads than more refined, more niche audience approaches do. Meta is also developing ads in which users click straight into a messaging conversation with a business.

But ads based on first-party data are only 18 percent of Meta’s revenue, according to The Wall Street Journal. Meta has a lot of work to do.

Key Issues Going Forward

Meta recently reported better-than-expected results in its most recent quarterly earnings announcement. CEO Mark Zuckerberg said 2023 is a “Year of Efficiency,” which means managing spending carefully. Key questions going forward:

  • How well Meta will use AI to recommend Reels content to Facebook and Instagram users. The more targeted the recommendations, the higher the engagement rates. Meta needs people to stay engaged on Reels like they are glued to their TikTok videos. Engagement means advertising revenue from businesses that want to target those users with content.
  • The performance of ad products based on first-party data. Businesses should continue to ask their Meta ad representatives for developments in this area.
  • How well Meta manages its costly investment into the still young metaverse, which remains a sore spot for the company. The metaverse generates no advertising revenue streams to speak of for Meta.

At True Interactive, we advocate for our clients that invest in Meta and other platforms. We will continue to monitor developments and adapt our ad strategies as needed.

Contact True Interactive

To succeed in the ever-changing world of online advertising, contact True Interactive. Read about some of our client work here.

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Is Search Ready for Conversational AI?

Is Search Ready for Conversational AI?

Uncategorized

The brave new world of AI-powered search has hit a speed bump.

During the week of February 6, both Google and Microsoft announced they were developing new search capabilities that incorporate conversational AI, or chatbots that answer searchers’ queries with detailed, informative answers. This interface would provide an alternative to the search engines interface we are familiar with today, in which users need to click on to web links and read short snippets of content to find answers to their queries.

Microsoft said that its Bing search engine was using the same AI technology that powers the wildly popular ChatGPT chatbot created by OpenAI. (Microsoft has a multi-billion dollar investment in OpenAI.) Google said it was about to unveil Bard, a chatbot with similar AI-fueled capabilities. Bard was based on AI developed by Google for quite some time.

Both these Big Tech companies were responding to OpenAI releasing ChatGPT for public use on November 30, 2022. Since that date, ChatGPT had become the fastest-growing app in history.

Google didn’t outright release Bard – the company demo’d the product that week and said an independent party of reviewers was vetting the product before its ultimate public release. Microsoft started to make Bing’s chat interface available in limited preview mode.

At first, both companies received generally favorable attention for showing how rapidly two Big Tech companies could bring to market a new way to search. But then the problems began:

Definitely not a good look for conversational AI!

By February 16, things had gotten so bad that The Atlantic magazine was declaring “AI search is a disaster.”

In response, Microsoft said that these types of incidents are to be expected. Microsoft said, “The only way to improve a product like this, where the user experience is so much different than anything anyone has seen before, is to have people like you using the product and doing exactly what you all are doing. Your feedback about what you’re finding valuable and what you aren’t, and what your preferences are for how the product should behave, are so critical at this nascent stage of development.”

Microsoft also announced that it will begin limiting the number of conversations allowed per user with Bing’s new chatbot feature.

Meanwhile, Google has asked employees to improve Bard by rewriting answers for topics that employees know well – a human-in-the-loop approach in which people stay involved as supervisors of the development of AI products as well as the editing of AI-generated content.

So, what now?

Well, nothing really changes for businesses at the moment. Google has not rolled out Bard. Bing is still in preview mode. Clearly, there is work to be done. The bad press suffered by Google and Microsoft simply underscores how rapidly these companies are moving. From the standpoint of building public trust, it sure looks like they would have been better off taking more time before starting to take these products closer to market.

Conversational AI is coming to search. These products did not drop out of the sky. Sooner or later, this interface was coming. It happened too soon for Google and Microsoft to escape some reputational damage. But the big picture is that the industry is more aware now of how the search experience is evolving, warts and all.

As we’ve recommended in previous posts, we suggest that businesses watch the developments closely and experiment with conversational AI (as everyone is doing with ChatGPT right now). It is important to become familiar with the ways these tools function, including the way ChatGPT can generate content (known as generative AI). This is no time to ignore the phenomenon.

At True Interactive, we are staying in close contact with Google and Microsoft and will report developments as we learn about them.

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To succeed with online advertising, contact True Interactive. Read about some of our client work here.

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Google and Microsoft Go All-In with AI-Powered Search

Google and Microsoft Go All-In with AI-Powered Search

Bing Google Microsoft

On our blog, we speculated that Google would launch its own conversational AI assistant for search as a response to the popularity of ChatGPT. Well, within hours, we had our answer, and then some: not only did Google launch a new conversational AI tool for search — so did Microsoft.

What Google Announced

On February 6, Sundar Pichai, CEO of Google and its parent company Alphabet, announced the launch of Bard, which he characterized as an experimental conversational AI service. Importantly, though, Pichai was careful to qualify how Google is moving forward. Instead of dropping the tool publicly as OpenAI did, Google is making Bard available to a team of “trusted testers” before making the tool publicly available “in coming weeks.”

This is a big difference in approach from OpenAI. Essentially Pichai was signaling, “We’re Google. We’re not going to risk our brand’s reputation by rushing something to the market until it’s ready.” By contrast, OpenAI made it clear that the company was going to crowdsource feedback from the public and make ChatGPT better – the “get to the market fast with an imperfect solution and make it better” approach that typifies Silicon Valley start-ups.

Google left start-up mode a long, long time ago.

According to Search Engine Land, the “trusted testers” vetting Bard are a demographically and geographically diverse group of people external to Google — an important consideration clearly designed to mitigate against bias – and bias is a problem that has vexed ChatGPT.

Bard is going to function as ChatGPT does now: synthesizing information to provide more complete, contextual responses to queries the way voice search has always promised to do. In Pichai’s words:

Bard can be an outlet for creativity, and a launchpad for curiosity, helping you to explain new discoveries from NASA’s James Webb Space Telescope to a 9-year-old, or learn more about the best strikers in football right now, and then get drills to build your skills . . . When people think of Google, they often think of turning to us for quick factual answers, like “how many keys does a piano have?” But increasingly, people are turning to Google for deeper insights and understanding — like, “is the piano or guitar easier to learn, and how much practice does each need?” Learning about a topic like this can take a lot of effort to figure out what you really need to know, and people often want to explore a diverse range of opinions or perspective.

And, he added that Bard will be incorporated into Google Search soon. Here’s a screen shot of how the interface might look, courtesy of Google:

This is quite an announcement, to be sure. As we blogged, it was known that Google had been developing conversational AI technology for quite some time – but the company was not ready to take it public. However, as a result, OpenAI was enjoying all the glory and credit for ChatGPT’s remarkable conversational abilities. On top of that, Microsoft invested billions of dollars into OpenAI and was reportedly incorporating ChatGPT into Bing Search.

Microsoft Drops an AI Bomb

And, speaking of Microsoft: on February 7, the company confirmed that indeed conversational AI was coming to Bing Search — not based on ChatGPT exactly, but a more powerful form of the tool. Microsoft shared a new version Bing, powered by an upgraded version of the same AI technology that underpins chatbot ChatGPT. The company is launching the product alongside an upgraded version of its Edge browser. This means that that the two will provide a new experience for browsing the web and finding information online.

The “new Bing” (in Microsoft’s words) offers a chat function, where users can ask questions and receive answers from the latest version AI language model built by OpenAI. Users can also create itineraries for trips. So, for example, you can ask it to “Plan a five-day trip to Mexico.” It’s available in preview mode at Bing.com.

Following the announcement, Yusuf Mehdi, Microsoft Corporate Vice President & Consumer Chief Marketing Officer, shared more detail on the Microsoft blog. Among other things, he elaborated on how Bing’s chat functionality can help with ideation, whether writing content or planning something:

There are times when you need more than an answer – you need inspiration. The new Bing can generate the content to help you. It can help you write an email, create a 5-day itinerary for a dream vacation to Hawaii, with links to book your travel and accommodations, prep for a job interview or create a quiz for trivia night. The new Bing also cites all its sources, so you’re able to see links to the web content it references.

Here is a depiction of the experience from the post:

He also elaborated on how the Edge browser is being improved with AI, via chat and compose. With the Edge Sidebar, you can ask for a summary of a lengthy financial report to get the key takeaways – and then use the chat function to ask for a comparison to a competing company’s financials and automatically put it in a table. You can also ask Edge to help you compose content, such as a LinkedIn post, by giving it a few prompts to get you started. After that, you can ask it to help you update the tone, format and length of the post. Edge can understand the web page you’re on and adapts accordingly.

As we learn more about Microsoft’s announcement, we’ll share more.

Many questions remain, such as:

  • Whether a conversational AI will actually improve the search experience given nagging problems with providing wrong answers and biased information. As The Verge noted, “AI language systems like ChatGPT have a well-documented propensity for presenting false information as fact.”
  • How Google and Microsoft will incorporate conversational AI into Search without harming their core advertising business. As noted, conversational AI tools flourish by giving searchers concise responses instead of links to other sites. Google’s ad model depends on people staying engaged on Google Search clicking on links. Microsoft’s ad business, though nowhere near the size of Google’s, also depends on clicks and engagement.

For now, we suggest that businesses watch the developments closely and experiment with conversational AI. No doubt Google and Microsoft will provide more context on how the interplay with their ads will work. At True Interactive, we are staying in close contact with Google and Microsoft and will report developments as we learn about them.

Don’t change your ad strategy. We’re in early days.

Contact True Interactive

To succeed with online advertising, contact True Interactive. Read about some of our client work here.

Is a ChatGPT Killer Coming from Google?

Is a ChatGPT Killer Coming from Google?

Artificial Intelligence Google

It looks like the AI arms race is heating up.

Google is expected to announce soon the launch of a competitor to ChatGPT, the generative AI tool that has shaken the technology and business world.

ChatGPT is the product of OpenAI, the company that produced Dall-E, which uses AI to create images. ChatGPT is one of many chatbots designed to respond to queries from people by providing richer, more detailed, and more human-sounding answers than their predecessors. The incredibly slick bot uses AI to do everything from write copy to answer search queries to write code.

Some technology/business watchers have speculated that ChatGPT is a threat to Google Search. That’s because ChatCPGT responds to queries with a single answer that synthesizes information, which could upend how Google Search provides answers with links to information. Moreover, OpenAI is receiving deep funding from Google competitor Microsoft, which is incorporating the tool in its products, including, reportedly, Bing Search.

Well, Google has not taken the rise of ChatGPT lightly. Google’s parent Alphabet announced its quarterly earnings recently, and Alphabet CEO Sundar Pichai said that Google is working on its own form of smart search. He said that “very soon people will be able to interact directly with our newest, most powerful language models as a companion to Search in experimental and innovative ways.”

Apparently “very soon” is almost here. On February 8, Google is hosting an event on YouTube, which will revolve around “using the power of AI to reimagine how people search for, explore and interact with information, making it more natural and intuitive than ever before to find what you need.”

Releasing an answer to ChatGPT is not far-fetched. Google has contended that it has been developing AI-powered search technology for quite some time but is not ready to share it publicly. Examples of Google’s AI-driven products include a chatbot language model called LaMDA (Language Model for Dialogue Applications), an image-generation AI called Imagen, and MusicLM, which translates text to music.

But when OpenAI seized the narrative about generative AI by releasing ChatGPT in November 2022, reportedly Google went into “Code Red” mode and began fast tracking the development of various AI products.

Google has reportedly asked employees to test potential ChatGPT competitors, including “Apprentice Bard,” which makes it possible ask questions and receive detailed answers similar to ChatGPT. Details about Apprentice Bard’s functionality were leaked to CNBC, which reported:

Apprentice Bard looks similar to ChatGPT: Employees can enter a question in a dialog box and get a text answer, then give feedback on the response. Based on several responses viewed by CNBC, Apprentice Bard’s answers can include recent events, a feature ChatGPT doesn’t have yet.

Meanwhile, recently it was reported that Google has invested $300 million in AI startup Anthropic, which is testing a rival to OpenAI’s ChatGPT. Anthropic’s language model assistant, Claude, hasn’t yet been released to the public, but the startup told Bloomberg it planned to expand access to the chatbot “in the coming months.”

One way or another, Google is gearing up to respond – although the impact of a chat-powered AI tool on Google’s paid search business remains unclear.

At True Interactive, we are following these developments closely. We already use Google’s AI-powered ad products. Based on our experiences with AI, we strongly advise that businesses experiment with these tools carefully.

We also recommend that businesses keep people involved in managing AI (or any technology). People are needed more than ever to ensure that AI does its job well. For instance, our experience has consistently shown that automated ads powered by AI underperform without people involved to monitor and modulate them when necessary. The same is true of generative AI. These tools sure sound confident when they present information, but they make mistakes, and they are notoriously biased. They are nowhere near the point of being self-sufficient.

We’ll follow the developments from Google and report back on our blog.

Contact True Interactive

To succeed in the ever-changing world of online advertising, contact True Interactive. Read about some of our client work here.

2023 Advertising and Marketing Predictions

2023 Advertising and Marketing Predictions

Advertising

Gather around advertisers, pull up a comfortable chair, and take a look at our advertising and marketing predictions for 2023! We take on some big topics, ranging from the rise of AI to the impact of the economic downturn. Oh, and TikTok and Twitter, too. Check out our predictions, and let us know yours!

The Economic Downturn Will Present an Opportunity

— Kurt Anagnostopoulos, co-founder

This is a time for companies to make smart decisions about their marketing spend. We’re clearly in an economic downturn. Over the next six months, the downturn will intensify although not to the extent of the Great Recession of 2008. When downturns occur and uncertainty happens, inevitably some businesses scale back on their marketing spend. History has demonstrated time and again that during lean times, the cost cutters lose out to the businesses that continue to invest in their brands. Companies that stay the course will come out the other side of the recession ahead. If you are smart about how you market and price yourself, you can leave your competitors behind when times are tough. It’s not necessarily about doubling down on marketing, and it’s not about cutting at the other end of the extreme. It’s about spending wisely.

A mentality of spending wisely could hurt the major ad platforms such as Google and Meta. They’ve become more expensive. With advertisers seeking to spend more wisely in 2023, Google and Meta might price themselves out of the running in favor of platforms that deliver better CPCs and performance for the money. An agency such as True Interactive can help businesses navigate the landscape by leveraging platforms in a more cost-effective manner.

The water is too murky to see too far out beyond the next six months. We need to see how things are going to play out for the second half.

Artificial Intelligence Will Need People More Than Ever

— Mark Smith, co-founder

You cannot spend a minute on LinkedIn these days without seeing someone talking about ChatGPT, the generative AI tool that makes it easy to do everything from write content to code. It’s understandable that ChatGPT has gained so much attention. OpenAI released the tool publicly in November 2022 and made it easy for anyone to use it. The public responded. But ChatGPT is just one in a growing number of AI tools being used to do everything from manage customer queries to create royalty-free music. Right now, a number of executives are experimenting with these tools to do the heavy lifting for them – the writing, image generation, and so on. But soon, the novelty will wear off. And everyone will realize what we know already: AI cannot do your work for you. People need to be involved managing AI like any other technology. If you use Google’s myriad advertising tools as we do, you likely understand. Our experience has consistently shown that automated ads powered by AI underperform without people involved to monitor and modulate them when necessary. The same is true of generative AI. These tools are slick, but they make mistakes, and they are notoriously biased. They are nowhere near the point of being self-sufficient. In 2023, some businesses will learn the hard way that AI alone is not the answer to making smart investments in digital marketing. They’ll realize that people matter more than ever.

Google Ads Will Get Costlier

— Beth Bauch, director

2023 could prove to be challenging for businesses highly invested in Google Ads. I anticipate more automation by Google, resulting in less control for marketers.

One of the most common suggestions in the “Recommendations” tab in the Google Ads platform is to convert keywords to “broad match,” away from the more traditional “exact and phrase match.” Exact and phrase match keywords are meant to only match to searches that contain your keyword, making search queries highly relevant. Broad match keywords allow your ad to show on searches that are related to the meaning of your keyword and can include searches that do not contain the keyword terms.

While we have seen some success when testing broad match keywords with Googles automated bidding strategies, we have also seen some significant failures resulting in high spend and poor conversion rates. So, you need to proceed with caution when using broad match. One of the ways we improve the quality of search queries is by adding negative keywords to prevent our ads from showing on searches that are irrelevant.

However, whereas in the past we had access to view all search queries matching our keywords, Google now limits that visibility, only showing the top search matches. This makes it more difficult to block irrelevant traffic resulting in more spend on searches with low conversion rates.

And poor-quality traffic is very costly, especially as we have seen significant increases in the cost-per-click (CPC) of both brand and non-brand keywords in 2022 – as high as 50 percent increases for brand terms alone year over year. For some clients, we saw rising CPCs even though we were not seeing an increase in competition on brand keyword bidding when reviewing the Google Auction Insights report. This is an indication that Google has raised the base price for participating in a specific auction, regardless of competition.

As Google looks to rebound and increase its profits, I expect to see even higher advertising costs for Google Ads in 2023.

TikTok Will Extend Its Influence

— Bella Schneider, senior digital marketing manager

With the increasing popularity of TikTok, I predict that the brand will expand and improve its ads manager to be more comparable to Facebook Business Manager. Currently the platform is lacking in a few areas, and if TikTok is to compete with some of the larger social channels, then it will need to make adjustments to allow for easier advertising on the platform.

Meanwhile, thanks to TikTok, I predict the world of video will dominate the advertising space. More and more video content is starting to look and feel similar to the videos displayed on the TikTok native platform. Whether it’s dances, trends, or challenges, I predict that advertising will shift towards this style of video content.

Does Twitter Have a Future?

— Max Petrungaro, account manager

I have a difficult time seeing advertisers return to Twitter as long as Elon Musk is at the helm. When Musk bought the company, things immediately started poorly with most of Twitter’s top advertisers putting their ads on pause or stopping outright. In December 2022, the situation for Twitter deteriorated, with advertising spend being slashed by more than 70 percent. Twitter tried to combat this by offering incentives to the companies that would keep advertising, but I do not believe that this will be enough to overcome the polarization that Elon brings to the table.

With most of its revenue coming from advertising, and top spending advertisers not showing ads and/or slashing budgets, there may not be a Twitter by the time 2023 is over. As long as Elon is associated with Twitter, I believe that more advertisers will start to focus their advertisements on other popular platforms, like TikTok.

Customer Data Platforms Will Have a Big Year

— Héctor Ariza, senior manager

As the push for tighter data privacy in the digital world gains momentum, I expect 2023 to be a big year for customer data platforms (CDPs). With stricter data privacy regulations being imposed by governments around the world, and the imminent cookie-less era looming, companies and advertisers are already exploring privacy-enhancing technologies in their search of a more secure, yet accurate way of tracking user activity online.

Still, whatever the alternative to cookies and existing tracking methods may be, it will likely rely heavily on data aggregation/modeling. Thus, first-party data will become ever so more important in the digital advertising world. CDPs allow companies to manage what data is used, where it is used and how it is used more easily. These systems also help with data consistency across marketing/advertising platforms and reduce the risk of mishandling customer data.

Retail Ad Networks Will Lean into Mobile Even More

— Tim Colucci, vice president

One of the biggest stories in advertising in recent years is the rise of advertising networks managed by retailers ranging from Amazon to Macy’s to Walmart. Amazon’s own ad business has become so big that it is challenging the Google/Meta duopoly. These networks have succeeded because they tap into first-party data shared by people searching and shopping on their sites. The next phase of growth will happen when they more effectively integrate consumer shopping data from physical stores into the first-party data they use to sell targeted ads. This is why retailers that operate physical stores and ad networks will invest more into their mobile apps. With self-service mobile apps, in-store shoppers give retailers data about their interests in real time in a faster and more efficient way than they do by having their purchases shared via point-of-sale technology. Look for retailers to make it easier for consumers to search and purchase on their apps – and for advertisers to run ads via self-service such as sponsored listings. Walmart has an edge on most retailers in that regard. Given Walmart’s influence and resources, I expect the company will lean into its competitive advantage while Target tries to play catch-up.

Contact True Interactive

To succeed in the ever-changing world of online advertising, contact True Interactive. Read about some of our client work here.