2022 will be a critical year for marketers as COVID-19 persists in most countries, digital and ecommerce sales accelerate, and Google moves towards ending support for third-party cookies in 2023. This is causing marketers to re-think their first-party data strategies, so they can ensure addressability for years to come.
Despite the uncertainties, it’s clear that privacy and the testing of first-party data-driven solutions will be top priority for marketers and agencies in Australia and New Zealand — and around the world.
Here are seven predictions to help ANZ marketers build a powerful 2022 digital advertising strategy:
1. The future of programmatic advertising will still be addressable
While there is not one single solution for addressability, this year, marketers will be testing a range of solutions – including activating their first-party data and enhanced contextual targeting solutions – to determine which ones work best for their business needs. Criteo’s latest research reveals that 82%1 of Australian marketers either have tests in place or are planning to start some.
2. First-party data will drive advertising strategies
Nine in 101 Australian marketers believe that access to first-party data will be crucial in marketing in the years to come according to a recent Criteo survey. With ongoing changes to privacy regulations, and evolving addressability impacts, marketers are going to continue focusing on amassing as much first-party data as possible — and activating it in the most impactful ways with the help of tech and agency partners.
The same share of Australian marketers (90%)1 say that tech partners will be key to helping them manage data changes. This shows that while the path forward for addressability may be complex, marketers are making it a priority and collaborating with those who can help them find success in both the short-term and long-term future.
3. Enhanced contextual targeting will become a game-changer
Contextual targeting is experiencing a resurgence because of growing privacy regulations, consumers wanting more control over their data and its huge potential as an addressable solution for the future. However, its reputation as an ineffective advertising solution still lingers—perhaps for good reason. In the past, contextual advertising was good at placing messages in contextually relevant environments, but not as good at targeting audiences who are in the buying mindset. For example – someone reading the latest news on the NRL might not necessarily be interested in purchasing a rugby ball.
Today, thanks to technological advancements and rich first-party data such Criteo’s commerce data set, which sees over US$900 billion of ecommerce sales annually (3X that of Amazon), marketers can now upgrade traditional contextual marketing campaigns with commerce intent signals to better target customers who are more likely to make purchases and reduce ad spend inefficiencies.
4. Commerce data will take center stage
The increasing importance of first-party data and the Australian ecommerce boom2 have rapidly increased the use of commerce media. Commerce media is a new approach for digital advertisers that combines large-scale commerce data and intelligence to engage consumers across the entire shopping journey and enables marketers and media owners to drive commerce outcomes (sales, revenue, leads).
Commerce data enables marketers to better reach their most valuable consumers by identifying interest and purchase intent patterns that enrich audience targeting and improve product recommendations to customers.
5. Retail media will drive profitability and performance at the point of purchase
While retailers have experienced a boom in online sales the last two years, profitability remains a challenge, and that’s where retail media will come in. According to Forrester3, retail media — the placement of brand-sponsored advertising within the open internet, or directly in retailer ecommerce sites and apps, that use first-party data – is poised to top US$50 billion in global revenue this year, surpassing the revenues of media giants like Netflix and YouTube. This is because retailers are increasingly enabling brands to reach their valuable audiences across the open internet.
We can expect even more sophisticated solutions for brands to reach their target audience to enter the Australian market and more data-rich retail media networks to form in 2022. These solutions will offer more targeting options, including targeting in-market audiences who recently browsed or purchased from a given category, as well as more engaging display ad formats designed specifically for retail. More than ever, brands will need these solutions to provide a user-friendly, self-service experience, with automated features for maximum efficiency and performance along with manual overrides for additional control, tied to more granular and reliable reporting.
With every business now an ecommerce business, as it’s the source of almost 100% of growth, retail media is expected to drive millions in media monetization for retailers and millions in product sales for brands in Australia. First-party data will be at its core, offering sustainable growth and long-term addressability.
6. The rise of ad-based entertainment streaming services will continue
A recent survey by Criteo reveals that Australia is increasingly open to video ads, with 56%4 happy to watch ad-supported video streaming services in exchange for free content or cheaper subscription fees. In fact, a further 20%4 are willing to share their data with advertisers. This is in exchange for receiving more relevant and personalized video ads.
As Australians increasingly look for on-demand entertainment options such as OTT and CTV, we will see these services increasingly gain an even bigger share from free-to-air television. Ad spend will increasingly be invested in digital video formats as more Australians adopt a mixture of subscription and ad-supported video offerings. This shift will not only be seen in Australia but internationally, with video ad spend forecasted to reach close to a whopping US$2,500m5 globally in 2022.
7. Australia’s ecommerce boom will fuel the open internet
Ecommerce sales Down Under are skyrocketing at a rate of over 20%2 year-on-year, with four out of five Australian households (nine million) who purchased goods online.
But ecommerce is not just about making purchases. According to Criteo’s Consumer Sentiment Survey, 68%6 of consumers say they use the open internet to conduct research on various products and brands, as well as read informative articles and reviews, before making a purchase. In fact, consumers say they spend 66%7 of their time online on the open internet, which reinforces the important role it plays in the consumer journey.
Build a winning digital advertising strategy
2022 will be transformative year as brands prepare for the future of addressability. Marketers should look into investing into future-proofed solutions, including integrating first-party data in their advertising strategies, contextual advertising, retail media, and video. The brands that do will come out on top.
1Criteo Google Announcement Survey, Australia, July-October 2021, N=79 Marketers
2Australia Post, “Inside Australian Shopping: eCommerce Update”, 2021
3Forrester, “Advertisers Lean Into Retail Media Momentum, New Modes, And, Yes, The Metaverse In 2022”, 2021
4Criteo State of Video & CTV Survey, Australia, April-June 2021, N=1072. Survey respondents are consumers who own a smart TV or an internet TV device and watch a paid or free video streaming service
5Statista, “Video Advertising Outlook”, 2022
6Criteo Google Announcement Survey, Global (Australia, France, Germany, Japan, South Korea, the United Kingdom and the United States), July-October 2021, N=914
7The Harris Poll and OpenX, “The open web vs. the walled garden”, 2020