Renewed optimism from marketers, as shown by the latest IPA Bellwether report, bodes well for publishers and the ad tech industry. After showing resilience, flexibility, and innovation during a deeply challenging year, the media industry can push forward, working together to connect with audiences, meet privacy regulations, and innovate as the digital landscape evolves.
Overall, the report anticipates a much stronger expansion in GDP this year, followed by a robust rate of growth in 2022 amidst ‘record strong rates of growth in ad spend’. This is mirrored by +45.9% of IPA panel members becoming more optimistic regarding their company’s financial prospects compared to three months ago.
We spoke to several industry executives to get their perspectives on the report’s findings and what it means for the future. Here is what they had to say:
Zack Sullivan, CRO UK of Future plc, commented: “Confidence among both the industry and consumers remains strong as we head into H2, and the crucial peak trading period leading into Christmas. Our own survey of 2,000 UK consumers in June 2021 also indicates a large pool of pent-up savings – to the tune of almost £200bn – with the majority of those surveyed planning to splash the cash as restrictions lift. Consumers are already gearing up for Black Friday, with 82% expecting to be more or similarly engaged than in the past, representing a significant opportunity for brands and agencies. The latest IPA Bellwether is yet another vote of confidence as the industry continues to revise and increase ad spend forecasts driven by consumers’ desire to make the most of 2021.”
Nick Morley, Managing Director, EMEA, Integral Ad Science (IAS) highlights the importance of taking into account the impact of the pandemic on consumer habits, shining the spotlight on contextual targeting and brand safety:
“It’s exciting to see that UK marketing budgets and confidence levels across the industry have increased in the latest IPA Bellwether report. Looking ahead, more advertisers and publishers have an opportunity to deploy strategies that optimize their digital media quality. With the rising importance of contextual targeting in marketing strategies, this is one major trend to watch. The pandemic has left a lasting impact on consumer habits, with the shift to a digital-first lifestyle, and brands should adopt the latest technology to control the context of their ad campaigns. In a post-pandemic landscape, advertisers are looking to engage with reinvigorated consumers via safe, suitable, and relevant ads. This will be key for brands to capture long-term consumer interest and spending.”
For Sivan Tafla, CEO of Total Media Solutions there are many positive signs that point to a solid recovery for the advertising industry – not least the return of in-person events, as well as the postponed date for the third-party cookie:
“The latest IPA Bellwether Report points to a much more robust position for the advertising industry in the UK, which is reflected in our own very positive data from advertiser and publisher partners. Google’s announcement delaying third-party cookie deprecation, provided an additional boost to digital advertising after a challenging year. I hope to see the recovery continue at pace in Q3 so we achieve a sense of normalcy that will further boost optimism and digital ad spend.”
Industry challenges spur innovation
Others we spoke to are reflecting on the industry’s challenges and priorities, and how that’s driving performance.
“It’s been a buoyant Q2 – at Adform we’ve seen all major products increase year-on-year against aggressive growth targets. We’re seeing both the buy and sell-side perform equally well, which appears reflective of current priorities to clean up the supply path and focus on accelerating first-party ID adoption”, says Philip Acton, Country Manager UK & BeNeFrance at Adform.
Michael Nevins, CMO at Smart AdServer shares a similar view highlighting the role the industry plays in creating a trusted environment for brands to grow:
“While some of this confidence should be attributed to the global COVID-19 recovery efforts, we shouldn’t overlook the positive work that is taking place within the industry to improve trading practices and create a trusted environment.”
Equipping advertisers with the tools to achieve greater efficiency with their ad spend, while also ensuring publishers have the solutions in place to drive greater value for their inventory are key industry priorities.Michael Nevins, CMO, Smart AdServer
“While Google’s delay may give the ad tech industry further time to implement viable alternatives for a world without third-party cookies, it is important we all still work aggressively on those alternatives to create a transparent and privacy-compliant ecosystem.”
While increased ad spend forecasts are wind in a marketer’s sails, it’s important to keep an eye on what’s on the horizon. Alison Harding, Vice President Data Solutions EMEA at Lotame points out:
“It is important that marketers and media owners future proof their businesses against the death of third-party cookies in 2023. Though Google has delayed the deprecation of the third-party cookie until 2023, around 40% of the global market has already done away with them (Safari and Firefox). Now is the perfect time to start or continue testing identity solutions, as you’re able to compare cookie vs. non-cookie environments.”
Video continues to soar
Meanwhile, the boom in digital video consumption and innovation are creating opportunities for both media owners and brands:
“The positive growth in the video category for two consecutive quarters is a very encouraging sign for marketers who are investing in the medium, especially in those premium channels that have seen a surge in viewership in the last year because of uptake of connected TV (CTV) screens,” says Massimo de Magistris, VP, Head of FreeWheel Markets, International at FreeWheel.
“As buying confidence continues to build throughout 2021, closer collaboration between media owners and distributors, advertisers, and technology enablers will be key to unlocking the full potential of CTV inventory.”
On the same wave of optimism, Bill Swanson, EMEA Strategy Lead, at IRIS.TV highlights key differentiators: optimizing media buying strategies and data access.
“It will be of no surprise that the main growth in media spend is continuing to spill out of linear TV and into CTV as marketers become increasingly aware of its value. However, agencies must continue to ensure they adjust their buying strategies to this format. Advertisers should not have to compromise between an audience-first or content-first strategy and must look to pull both together. To achieve this, buyers must have access to data from both sides.”
Positivity tempered by realism
Further comments received by WNIP in response to the IPA Bellwether report reflect the positive sentiment, although challenges clearly remain:
Matt White, VP EMEA Quantcast: “The Bellwether report findings reflect not only what we have seen gradually happening in Q1 2021 but also confirms our predictions for what is being termed an ‘advertising bomb’ coming in the second half of 2021. With large-scale events being televised across the summer, this is going to be a great opportunity for marketers to spend the shelved budget from 2020 – as we’ve already started to see. Not only is this great news for brands that want to advertise at these events, it will have knock effects for publishers. Consumers will be looking for the latest scores, information and opinions and they’ll be heading online and visiting publisher websites more frequently. As a result, the demand for ad space could increase. Brands have a years’ budget to spend within six months, so it’s likely that they won’t hold back and will be placing as many ads as possible.”
Dominic Woolfe, CEO, Azerion UK: “The IPA Bellwether report reflects the optimism we have felt over the last few months with the lockdown restrictions slowly but surely lifting. The socio-economic impact of this quarter has been promising, as businesses begin to prepare for a strong economic recovery following the impacts of Covid-19.
“However, if the industry is to meet the forecasts predicted for ad spend in 2022 brands must continue to work with partners that deliver meaningful outcomes. With the IPA Bellwether report playing on the edge of caution regarding new strains of the virus and how this may result in a brisk spell of consumer spending, brands will need to maintain a consistent level of communication with consumers in a creative and engaging way within brand-safe environments.”
Jonny Whitehead, Board Director, Skyrise Intelligence: “It’s great to see marketing budgets have expanded for the first time since 2019 with places opening up again and with businesses expected to make a strong economic recovery. While progress is certainly being made, agencies and advertisers will need to balance new ways of working with the need to adapt to a rapidly changing digital landscape. There will also be a need to focus on accessing, analysing and testing the use of non-personal targeting signals such as context, time, and location as the industry prepares for further data deprecation if we are to meet the strong growth forecast for ad spend in 2022.”
Barry Cupples, CEO of Talon Group: “We’re seeing a really positive return to market from brands across the summer as the UK opens up. Out of Home – and particularly digital OOH – are projected to outgrow the ad market not just in 2021 but to continue the evolution in 2022, with forecasts expecting its value to increase by 57% in the UK this year.
“A key factor for us in OOH is the ability and flexibility to deliver effective outcomes alongside TV and social media channels for brands hungry to reconnect with consumers coming out of the pandemic. Our core strengths of reach, engaging young audiences and delivering effective outcomes will pay dividends for the rest of the year, as reflected by the IPA analysis, with brand activity delivering more integrated campaigns across online and offline channels.
Nial Ferguson, Managing Director UK & Ireland, Sourcepoint: “This latest IPA Bellwether report points towards 2021 as a year of strong growth for the advertising ecosystem, as we reach pre-pandemic levels of spend. While Covid-19 has caused disruption to many marketers, issues such as increasing global privacy regulations and restrictions on browser identifiers still remain an important issue for those who don’t seek resolutions. Therefore, businesses must harness the increase in marketing budgets to future-proof themselves against changing regulations and privacy enhancements.”
Going forward, the industry must place data ethics front and centre to communicate the value exchange to consumers. We now have the opportunity to invest in compliant technologies that support the free and open internet, which can, in turn, create a privacy-first future.Nial Ferguson, MD UK & Ireland, Sourcepoint
Nick Reid, Regional VP of Northern Europe, DoubleVerify: “Brands, agencies and vendors must take this moment to reset and drive an improved ecosystem; one with clear baselines of media quality, accurate performance and relevant, privacy-friendly experiences. Only by utilising data more efficiently, and collaboratively, can they create a more transparent ecosystem which informs smarter strategies, fuels accountability and offers greater value for all stakeholders. After all, if we get this next phase right, and harness the current momentum of digital transformation, we can put in place profound benefits for all parties; striving for a stronger, safer and more secure ad ecosystem for the consumer and the brands who look to inspire them.”