A constant cacophony of major regional conflicts, crippling inflation, and scarily fast technological progress is making the pandemic years look like a relative walk in the park for brands and marketers.
Remember when stay-at-home directives shut down entire countries and seemingly everyone was hooked up to their screens? It may have looked like a new world order, but at least marketers had some clarity on how to navigate it — by moving at superspeed towards everything digital.
There is evidently little order these days, and 2024, with its looming deprecation of cookies, Generative AI-induced disruption, and fast-changing media landscape — amid deep economic uncertainty — looks set to be one of the most turbulent years in recent memory for advertisers.
In volatile times like these, the best way forward may be to focus on what isn’t likely to change.
For starters, even amid higher prices and recession fears, many consumers continue spending. But the channels through which advertisers can reach them are changing, just like the identity solutions needed to find them online, as cookies deprecate.
And consumers still gravitate to ads that genuinely add value to their lives. That’s also where Generative AI’s (GenAI’s) creative powers could help, or hinder.
In 2024, global ad spend is forecast to rise 8.2 percent to surpass $1 trillion. That shows advertisers are still optimistic about finding sources of growth. Unlike previous years, however, how they tap in to this growth will likely change significantly.
Much of what’s going on in the world is outside of advertisers’ control. But there is one pressing issue that is within their control, and that is preparing for a cookie-free world, as Google begins to turn off cookies in Q1. Many marketers, however, have been slow to embrace this new reality, with a recent survey finding that 63 percent of British marketers have "no clear plan for a post-cookie world.” That could be a big problem.
“Traditional mass communication channels are losing traction, both in their broad-reaching capabilities and their ability to engage niche audience segments,” says Paul Remitz, CEO of Omnicom Media Group Germany. “The emphasis is now on bolstering the influence of digital transformation opportunities —- from social media platforms to the expansive realm of e-commerce, from leveraging data signals to owning proprietary first-party data.”
Remitz adds: “Budgets are becoming more constrained. The focus now shifts towards maximizing value with precise measurements for optimal budget allocation and crafting distinctive messages.”
The latter could be a guiding light for advertisers in the chaos of 2024. GroupM predicts that retail media spend will surpass all of TV’s spend by 2028, including CTV. Last year’s retail media gold rush underscored this seismic trend, but in a chaotic year — like 2024 seemingly promises to be — this transaction data could help marketers separate the music from the noise.
Already, advertisers can tap in to enormous troves of rich data, thanks to retailers’ loyalty programs. Consumers’ participation in these set to grow could grow in 2024 as they take advantage of lower prices often offered to loyalty-card holders only.
The big question
All of this brings us to the question: What could advertising look like in this new reality, where one could, for example, target a Gen Zer watching a travel show on her smart TV with the precision afforded by the knowledge that she just purchased compression socks for flying?
It may be tempting to look to GenAI as a savior, purportedly here to bestow copious amounts of creativity and insight but at a fraction of the cost of what humans could do. It sounds almost tailor-made for a year of abundant media channels and tight marketing budgets. Not so fast.
“Whenever something grows exponentially, such as the media landscape, there can be a tendency to respond with volume to meet demand. That increased volume is unlikely to be of the highest quality,” says Paul Baker, senior director of media at research firm Savanta.
Outside of its obvious effects on search, the industry is still mostly speculating on how to really make the most of GenAI, says Casey Soulies, VP of digital media at The Shipyard, an independent advertising agency.
“The primary challenge is harnessing and redirecting the massive hype, interest, and expectations with realities of how it can and should influence programming,” says Soulies, pointing to enhanced targeting, dynamic creative, optimization of media, planning, and research aids as possible use cases.
That doesn’t mean GenAI is a creative dud — far from it. British chocolate brand Hotel Chocolat’'s “Velvetiser” ad was rated among the best this year on System1’s effectiveness scale —– and AI was behind its creation. But ultimately, “audiences don’t care when brands shout about the technology;, they care when brands use it to make an ad they love,” says Jess Messenger, head of communications at System1.
Which brings us, in the words of advertising great David Ogilvy, to this answer: “It is tragically easy to be stampeded into change. But golden rewards await the advertiser who has the brains to create a coherent image, and the stability to stick with it over a long period.”
The economy changes, media channels change faster, and technology changes at 10 times their speed. But consumers are always there. Aren’t you?
Welcome to 2024.