Since Google announced the removal of third party cookies from its Chrome browser (2/3 market share) and Apple’s eliminated the tracking of device identifiers, it’s been off to the races in the ad tech world.
However, the innovation isn’t coming from the intermediaries such as the trading desks, exchanges, DMP’s or AMP’s. Instead, the publishers are taking back control. Amazon’s ad network will have grown by nearly 400% from 2019 to 2023 with 39B USD in revenue. Other retailers such as Kroger, CVS and Walmart are also growing their advertising network. Walmart is vying for ad Dollars with “closed loop measurement” that includes its 4700 stores.
Digital ad inventory is growing far beyond retail media. Delivery service DoorDash introduced search page ads for its app in late 2021. Marriott announced its media network rollout in May 2022. Its SVP of marketing channels and optimization, Chris Norton says the aim is to connect advertisers with customers. It will eventually expand beyond Marriott’s app and display channels to the hospitality group’s Wi-Fi portal, in-room TVs, and ultimately all screens on its properties.
Among streaming platforms Roku has build a full service offering where “OTT advertising companies include content providers that sell ads, companies that help marketers purchase ads and companies that facilitate the exchange. (…) It sells ads on their own content and facilitates the trading of ads on an automated exchange.” In addition to spots that run before and during content, advertisers can opt for banners and interactive ads too.
Hulu, which is also available on Roku, announced new digital ad inventory available — in its shows. In the future advertisers will be able to occupy in-content ad spaces. For example a billboard in the background of your favorite TV show. Hulu’s CPM reportedly ranged from $20 to $60, and more specific contextual digital placements are only going to increase these rates.
What happens when everything is an ad network ?
While digital advertising is expected to grow from $239B in 2022 to $B in 2023 (eMarketer), retail media will account for $52B of that spending. In tune with a slowing YoY growth in digital ad spending, which channels are likely to capture the dollars shift away from granular targeted ads placed on Facebook and Google ?
Where will the budget for all the new inventory come from ? Will overall prices be lower or higher based on when the purchase funnel cannot be tracked entirely — yet provides a measurable sales uplift ?
Something somewhere has got to give. The growth in retail media spending indicates that tracking ad dollars from impression to conversion remains a top priority. Yet smaller, highly specific audiences on smaller ad networks could become just as valuable for publishers that hold the respective first party data.
More inventory ultimately means more opportunities for advertisers, more complex media buying, and if done well, more efficient ad budgets. But have advertisers learned from the previous decade of granular targeting and choose to diversify because they have to ?
The increasing dispersion of inventory might ultimately benefit brands, after all, the most effective campaigns used more, not less channels.
Thank you to Barry W. Enderwick for the editorial input, follow him for thought provoking marketing content
