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How to Predict the Ad Future: Watch the Big Guys

  |  May 30, 2014   |  Comments

Telling the future has never been easy, but one clear way to make some strong guesses is to look at how those who have some sway over the ways and means of advertising are using that power to make some changes.

I figure that change happens in one of two ways in this industry of ours.

Advertising is an extremely dynamic industry. We are in the business of consistently chasing after consumers, trying to get someone to make a decision to buy a product or change an attitude. And, since people are always changing, it means that we have to change as well, adapt to their habits and their needs.

We find ourselves in this constant state of shifting, trying to figure out the next best way to make that connection. One way that things shift is simply from the marketplace of ideas. One agency or brand will try something new - an experiment or an innovation - that works well and catches on. I remember a few early ads that used augmented reality (one for Mini in particular). It was certainly the first time that I had seen or heard of the technology, and it certainly caught on quickly. Next thing you knew, ads that used augmented reality began to appear everywhere. The technology had stuck and we all wanted to try something with it. That is the first way that change happens: from the ground up.

That way certainly feels very natural and I think we like it because we are always looking to be inspired by the free-flowing creativity that surrounds us. But there is another way, one that is definitely more top-down. This is the sort of change that happens when a big player, usually one that controls the very platforms upon which advertising and marketing is built on, makes a move that defines the marketplace.

Let's look at three examples of what I mean, all of which happened over the last year or so.

Google Favors Responsive Design

Many months ago, Google made an update to their algorithm - that secret piece of software that determines what pages to serve (and in what order) to a particular search query. Google is constantly tweaking and tinkering with this algorithm, usually in an effort to generate the best results for the user and prevent against scamming or gaming the system. But in this release, Google also announced that they are giving extra favorability to sites that are built on responsive design principles.

Responsive design is a combination of technology and design that ensures that a Web page will look good on any device - laptop, cellphone, tablet, etc. The interesting thing about Google giving favor to responsive sites is that responsive design has nothing to do with the content of the site itself.

In effect, Google is pushing the marketplace in a direction they think is good. They know that the algorithm is a powerful tool. Site owners will do anything (legal) that will give them a better ranking. So, if they find out that building in a way that is responsive will get them an extra edge in the ranking, they will do it. The result is that more sites are responsive. Google, with a deep investment in mobile technologies, gets a more mobile Web.

Omnicom Buys Twitter Ads Upfront

Earlier this week, there was a big announcement that Omnicom, one of the large holding companies, announced that it was giving Twitter $230 million. In exchange, they are getting a lot of inventory at locked-in prices as well as what they are calling "first looks" at new ad formats. It's similar to deals struck by other holding companies and social networks (i.e.: Publicis and Facebook).

I don't quite know what they mean by "first look" (and I don't see any details anywhere), but I would assume that means a sneak peek and first chance to try out any ad formats that Twitter is working on.

This is a big move and it provided a good boost to Twitter's stock the day after the announcement (transparency: I personally own shares in Twitter). Of course, Twitter is not going to live on these monster deals alone. It does signal to the industry, however, that Twitter is looking to engage with agencies upfront. They want to lock in deals that will place their large amount of inventory, specifically, on exchanges. As a reward for doing this, Twitter is willing to open up the curtain and let you back into the lab. Or, at least, they will let you be first in line when they open that curtain.

This is deeply in step with the pay-to-play nature of social media. Twitter is signaling to the industry their intention to strike deals with agencies and brands (of any size, really) as a way to get not only the inventory they want, but also access to the really good stuff.

Facebook and Content

The last one is, by now, an old story. Facebook has throttled the organic reach of posts, forcing brands to pay for promotion. I've written about this in the past, but to reiterate: what many see as a way for Facebook to get revenue, I see as a way to get better content from brands. This is a strong way for Facebook, which has become a primary method for getting content out to consumers, to help ensure that this content is as strong as it could be.

Telling the future has never been easy. Shoot, figuring out the past is hard enough (and I'm often a bit confused about what's happening right now!). But one clear way to make some strong guesses is to look at how those who have some sway over the ways and means of advertising are using that power to make some changes.

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ABOUT THE AUTHOR

Gary Stein

Gary Stein is SVP, strategy and planning in iCrossing's San Francisco office. He has been working in marketing for more than a decade. Gary lives in San Francisco with his family. Follow him on Twitter: @garyst3in. The opinions expressed in Gary's columns are his alone.

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