The Digital Media Bell Curve
The rise and fall of digital media technologies
The digital media landscape can change in the blink of an eye. Consumer preferences are ever-evolving. The way we buy, the way we watch, and the way we learn have been deeply impacted in the last year by COVID. To add to all that, a new range of privacy laws are changing the ways that marketers are allowed to gather data. And Google’s deprecation of third-party cookies is about to upend the way many digital publishers attract advertisers and connect them with their audience. These are just a few of the changes currently affecting the digital media landscape. These changes happen so quickly that it can be difficult for even the savviest marketers and media professionals to keep up.
New technologies, tools, solutions, and strategies all rise and fall with alarming regularity. Some become an ingrained part of the ecosystem as others pass into obsolescence. The only constant is that the things that the industry is talking most about are often the things on the horizon, not the things that you need to deal with every day.
At AnyClip, we always have our eye on this horizon, but at the same time acknowledge the importance of working in the “now”, where the majority of the market — our customers, their partners, and the advertisers they serve — are still operating their businesses. When we think about the digital media landscape, the rise and fall of technologies don’t happen overnight. It’s a lifecycle that occurs over years — a natural flow and ebb: a digital media bell curve. In this bell curve, technologies and trends arise, mature, peak and decline as they move through the curve, some with alarming velocity. As time goes, newer tech pops up and established tech falls off.
What’s ranking where on the curve as we look ahead to 2021? Here’s my take.
The closer a solution or technology is to the immature end of the curve, the further away it is from being ready for mainstream adoption, but that doesn’t mean they don’t have potential. Immature terms and technologies have recently entered the market and in most cases, they’re driven by a real need or an innovative idea. However, they’re also untested, unscaled, or not fully adopted. In other words, they still have the potential to continue up the rising side of the curve or remain stalled at the immature stage, depending on how successfully they’re embraced by the industry.
1. Ads.cert: Cleaning up the digital supply chain has been an industry-wide priority for years and the need has become increasingly acute as pandemic pressures demand that marketers look for ways to eliminate waste. Ads.cert uses cryptographic tools to ensure that the inventory being transacted on is legitimate. While the need is great, this standard hasn’t been adopted widely enough yet to be considered mature.
2. 360-Degree AR/VR: Technology like 360-degree video for virtual and augmented reality shows tremendous promise as it enters the bell curve. Digital media and marketing professionals are excited about the potential it offers to create immersive experiences, but the tools to deploy it at scale aren’t yet available. However, it’s gaining ground as more consumers purchase increasingly affordable VR headsets and mobile device makers create ever more dynamic AR tools and wearables.
The rising portion of the curve captures concepts that may not have reached maturity, but which are more definitively trending in that direction. The closer these concepts fall to the peak of the curve, the closer they are to achieving scaled adoption. These are concepts with momentum, growing closer to maturity either because they have had time to proliferate and develop or because they are being driven by an urgent market condition.
3. Video Conference Streaming: The poster child for rising technology. Video conferencing has been with us for a while, but the COVID-19 pandemic forced it into the mainstream. Over the last year, video conferencing has gone from an option to a near necessity. As the world goes from hosting occasional video meetings to running entire economies on platforms like Zoom, technology providers are still working to keep up with the growing demand. Video Conferencing is still not matured, but it’s moving up the ranks.
4. Contextual Targeting and Video Brand Safety: The popularity of these items is growing and largely driven by a combination of external forces. The impending death of third-party cookies and the attendant loss of third-party data for targeting have led to a renewed focus on contextual for marketers who value relevance. Meanwhile, the massive expansion of video inventory combined with a tumultuous news cycle has driven a renewed focus on bringing comprehensive brand safety to video content in a way that goes beyond manual tags and video text.
5. Sellers.JSON and Header Bidding: Marketers and publishers alike have spent the last half-decade looking for solutions that would allow them to scale the buying and selling of inventory while maintaining the trust inherent in direct sales. Sellers.JSON is a mechanism that allows buyers to easily discover who direct and intermediary sellers are, even if they are at the end of a chain of resellers, creating greater clarity about who is involved in a given transaction. This script, along with tools like video header bidding, allows publishers to monetize inventory efficiently without sacrificing trust. While these solutions have seen growing adoption bringing them closer to maturity, there are risks to bring their demise as fast as they rose.
Once the adoption will get closer to 100%, we will need to ask if the problems were solved — however, fraud has a way of adapting to new technology. If the entire market adopts sellers.JSON and fraud continues, that's when this protocol will begin its decline to obsolescence. The only viable alternative available is ads.cert which attempts to authenticate ad requests and impressions on the fly.
6. Affiliates: On the publisher side, solutions like affiliate marketing owe their placement higher on the rising side of the curve to the widespread diversification of publishers’ revenue strategies. Creating product-driven content that drives users to purchase through affiliate links has been a widely adopted strategy for consumer publishers looking to offset losses in advertising revenue with featured merchant commissions. Having been adopted by major publishers over the last few years thanks in large part to investments from major eCommerce platforms like Commission Junction, Amazon, Pepper Jam, Rakuten and others, affiliate sits higher than other concepts on the rising curve. Consumers are increasingly turning to digital storefronts for their purchasing needs and more digital media companies successfully fine-tune their audience acquisition strategies, conversion tactics, and business terms to maximize profitability for affiliate businesses. We expect to see affiliate marketing continue to mature and grow in popularity in the years to come.
At the top of the curve sit technologies, solutions, and concepts that have reached maturity as we define. These concepts are widely adopted and widely understood throughout the industry. The technology that drives them is fully developed and scaled and they are a standard part of most marketer and publisher revenue strategies.
7. Programmatic: First among these fully matured concepts are programmatic advertising. Once a last-ditch solution for publishers looking to unload low-quality and remnant inventory, programmatic is down a foundation stone of the digital media ecosystem. Real-time bidding allows publishers to efficiently price and sell inventory without the hassle and length sales cycle of direct deals while providing marketers with an efficient way to build scaled campaigns that reach the audiences they want without doing dozens of direct deals. According to this IAB study, it’s likely that COVID has made direct-sold campaigns much harder to sell and deliver. While a few years ago programmatic might have been the newest concept on the block it’s hard to find a publisher operating that isn’t selling at least some of its inventory programmatically today.
While programmatic has certainly matured, there’s reason to believe that it may be at risk of peaking or even heading into decline before long. The digital media space is increasingly dominated by the duopoly of Google and Facebook leaving ever less space and margin for players that operate outside their ecosystems. Furthermore, while programmatic has proven efficient, it’s never been able to rid itself entirely of risk—both fraudulent impressions and more recently brand safety concerns driven by the explosion of unsafe, controversial, or politically charged content. As consumers and regulators alike have begun to sour on traditional ad placements the rise of programmatic may finally be nearing its end.
8. Subscriptions: While affiliate commerce is still settling into a permanent place in the digital media revenue ecosystem, subscription models have already achieved maturity. While many publishers turned away from audience revenue at the start of the digital era, many have found that creating content that readers and viewers are willing to pay for directly makes sense in an era of declining ad rates and this strategy has rapidly achieved maturity and wide adoption. Subscriptions saw a monumental boost at the beginning of the COVID pandemic. Specifically, paywall subscriptions to digital news increased growth by 110%. Average Revenue Per Subscriber is still growing, though the growth rate slowed by 59%.”
9. Video Ad Serving Template (VAST): Finally, while measurement standards come and go as they are introduced, adopted, and eventually phased out, today's dominant and most mature standard for video advertising is indisputably the Interactive Advertising Bureau’s VAST. With near-universal adoption and recognition, VAST helps to standardize video ad placements to ensure that video creatives are easily interchangeable across platforms and that they provide a uniform experience.
The digital space is in perpetual motion. For every concept or solution on the rise, there is usually another whose popularity of efficacy is in decline. This side of the curve represents solutions that have either fallen out of favor or been replaced by more effective tools, tactics or standards.
10. Display Advertising: Long a staple of digital marketing and media monetization, are by no means gone, but neither is it the preferred method of reaching customers for a growing number of marketers. When AT&T purchased the first documented display ad on HotWired.com way back in 1994 the click-through rate hovered at around 15%. Since that time, display advertising has remained effective, but its overall efficacy has fallen off considerably as new formats have garnered more attention from consumers and more dollars from advertisers. Today, display advertising is still a part of most brands’ marketing mix and most publishers’ revenue strategy, but a growing number have moved on from display as clickthrough rates fell to fractions of a percent and on-site user experience became an important competitive metric for publishers.
As with many concepts and tools that have entered decline, display also faces competition from newer ad formats more suited to the way that users consume content. Video with its ability to tell deeper stories is certainly stealing some of display’s thunder, as is mobile advertising. Both formats will see a boost as consumers continue to consume more video content year-over-year and the imminent arrival of 5G suggests increased mobile usage in years to come.
11. Video Player-Ad Interface Definition (VPAID): The rise of VAST standards has meant the gradual deprecation of tools like the VPAID the standard by which players determined which ad to play for a given interaction. The latest VAST versions (VAST 4 and 4.2) were developed to address interactivity and transparency more than its older versions. While still in use, VPAID has largely been supplanted by VAST as the industry-standard leading to a slow decline of the once-dominant script.
12. Ads.txt: Ads.txt is almost fully adopted by almost every website worldwide. However while it worked well to reduce misrepresented inventory, it clearly did not solve the IVT problem. Therefore, the market is actively looking into new solutions (ads.cert being one), thus it's on the decline.
The bottom of the curve is reserved for subjects that are nearing obsolescence. Either due to replacement by a more efficient solution or policy changes at major platforms, some tools, ad formats, and standards are no longer viable.
13. Third-Party Cookies: While not yet entirely obsolete, the writing is on the wall for the third-party cookie. In January of this year, Google announced plans to deprecate the use of third-party cookies in the name of consumer privacy. This is the latest addition to consumer privacy regulations like Europe’s GDPR and California’s new CPRA/CCPA. The decision, which goes into effect in mid-2021 will spell the effective end of tracking cookies which have allowed marketers to track consumer behavior across the open web. Privacy regulations are popping up all over the US from NY to North Dakota to Hawaii. These laws will continue to grow and affect how marketers gather, track, and store personal information.
14. Midroll: The Coalition for Better Ads (CBA) introduced guidelines this year to severely limit midroll ads—effectively eliminating them from short-form video content experiences. While publishers aren’t required to adhere to these guidelines, Google’s Chrome browser—the world’s most popular browser—will block all ads that are not compliant with Better Ads Standards, effective as of August, 2020. Based on the new standards, it’s likely we’ll see the end of midroll ads as we know it very soon.
How to use the Digital Media Bell Curve
Most busy marketers and media pros have dozens of conversations per day about everything from last week’s campaign performance to next year’s technology budget. We sit with analysts, read trade reporting, and talk to vendors, all of whom offer a different perspective on what the next big thing is likely to be and why it deserves an investment of your dollars and time. With so many buzzwords flying around, it can be difficult to keep track of what’s important today, and what we should be thinking about for tomorrow. Use the Digital Media Bell Curve to quickly spot an immature solution that can wait for next year and a passé strategy that’s heading toward retirement. Not only will you save time and money, but you’ll have the chance to focus on what really matters for your business.