How shifting consumer behaviour is reshaping the advertising landscape

Consumers have more options when it comes to premium content, but their attention is finite so brands must make their messages more relevant.

Before the internet took its place in the advertising life cycle, the purchase of advertising was a manual process across the different mediums, from print to broadcast and out-of-home. However, as consumers increasingly consumed news, film, music and information digitally, manual processes alone were no longer sufficient to handle the astonishing scale of advertising opportunities.

A recent report found that APAC’s advertising growth is being fuelled by digital formats. Year-on-year, digital advertising sales is expected to increase by 16 per cent, hitting US$90 billion, or 49 per cent of total advertising sales. On top of that, the rise of mobile and its pervasiveness means that mobile impressions and clicks are now attracting a huge proportion of the digital dollar.

SBR speaks with Samuel Tan, Senior Director, Market Development of JAPAC, Xandr, where he shares more about how shifting consumption patterns are changing the way brands and marketers engage with consumers, the evolution of programmatic advertising and trends to keep a look out for in this space. 

How has programmatic advertising changed/evolved over the past five years, especially in an era of rapid digitalisation and drastic shifts in media consumption habits?
It’s clear that consumers today have more options than ever before when it comes to premium content, but attention is finite, making it easier to tune out a brand’s message if it isn’t relevant to them or their interests.

It’s in this context that the choice of advertising technology is becoming more important than ever as digital’s share of overall ad spend increases, and marketers want to better understand the ecosystem and where their money is going. We’ve seen digital media buying evolve to become a more strategic activity and the choice of platforms used is increasingly viewed as strategic investment decisions.

At the same time, this introduces complexity and requires a level of specialisation that not all participants can easily achieve, or even aspire to. So, increasingly, when customers now make a technology decision, a critical factor is identifying partners that can take them on the journey of developing core skills and for the partner to really lean in and develop plans that have the best interests of the client at heart. This has become a key element for marketers, agencies and publishers.

With traditional mediums like TV and radio being phased out in favour of digital and on-demand streaming, how does this impact both brands and consumers?
While the proliferation of content and consumer touchpoints has created new opportunities to engage, it has also contributed to fragmentation of attention and made it more difficult for advertisers to find the right consumer with the right message.

That said, while the way some of the traditional channels are consumed has changed markedly, we would disagree with the statement that TV or radio is being phased out. These channels continue to provide a powerful platform for brands to reach consumers. The exciting part is the opportunity to apply digital best practices to the way traditional channels are planned, traded, measured and optimised.

As digital and TV silos give way to converged buying, we know that advertisers are looking for technology platforms that enable cross-screen reach, which then helps drive more relevant advertising experiences and better business results. All of this can be done while reaching interested consumers however they wish to view content.

Xandr recently announced the launch of its new strategic buying platform Xandr Invest, which gives advertisers access to omnichannel inventory including OTT, mobile and premium video. With its flexibility and customisation, brands are able to reach target audiences across channels while consumers are served premium, relevant advertisements.

Consumers today have more control than ever over what they see (ad blockers etc), can brands and marketers still connect with consumers effectively?
It’s true to say that today’s advertising experience, particularly in digital channels, has not kept pace with the high-quality content that is available. As I touched on earlier, consumers have multiple options, and as such, the ad experience needs to complement the content and context experience in order to resonate with consumers.

To bring advertising back to its origins of helping brands tell powerful stories that drive behaviour, technology platforms need to incorporate tools and services to help advertisers converge TV and digital media strategies. At Xandr, we want to create immersive ad experiences, this may include reducing ad load while increasing the presence of more highly valued, innovative ad formats. All of this has to be done in a way that respects consumers’ privacy.

Do you think that the advertising industry is equipped to handle the rapidly changing landscape and is able to keep up with the constant emergence of new technologies?
All of the technology innovations we see in market are generally designed to address challenges across our industry. While they can help solve really complex business problems, the sheer volume of solutions does make it confusing.

It is in this context that AT&T created Xandr as a new kind of advertising company to address these challenges on a global scale. Holding true to our AppNexus roots, we see our role as not just providing technology but also educating and working alongside our peers to develop solutions that help create differentiation and ultimately achieve real business outcomes.

With global advertising spend expected to reach US$520 billion by 2023, a recent report found that Amazon is set to disrupt the duopoly of Facebook and Google with a 470% growth in advertising revenue by 2023, how will this impact the advertising ecosystem in Asia?
While I can’t speculate on the direct impact that Amazon will have specifically, I can say what we know to be true, marketers want to be where consumers are, and leverage insights to deliver meaningful advertising experiences throughout the sales funnel.

At Xandr, we want to create more opportunities for brands to do precisely this. We’re committed to creating a premium advertising marketplace that makes it easy for buyers to reach their target audience across screens, and at scale, and for sellers to achieve better yield by aggregating inventory with other premium publishers.

The companies who can bring additional value and assets such as world-class content, unique data sets and technology will be disruptive and capture outsized value.

What are the emerging trends in APAC’s advertising scene and how do you see them playing out in the next 12 months?
There are a few trends that we think will be of note throughout APAC over the next 12 months.

1. Content creators such as your traditional publishers and particularly broadcasters will continue to demand greater control of and transparent insights into their monetization on the open internet.
2. Publisher consortiums such as SMX and KPEX will continue to invest in the premium products they bring to market, such as video, as well as work to ensure that ease of access and unique audiences remain core to their proposition.
3. While consumers’ attention will remain fragmented across channels and devices, super apps such as Grab will continue to offer exciting new ways of capturing this attention. Brands will see this as a significant opportunity to leverage consumer insights and deliver impactful advertising experiences. We expect that those super apps that don’t currently offer advertising will start to do so.
4. Streaming platforms such as iFlix that double down on creating unique, fit-for-purpose content that taps into local and cultural nuances will benefit vis a vis other players that rely on licensing deals.
5. Convergence isn’t a pipe dream and is happening today in markets like Australia where buyers can trade linear TV in the same platform as Broadcast Video on Demand (9Galaxy). We will see agencies respond to the idea of holistic screen planning and look for ways to combine traditional and digital planning and buying teams.