The current economic environment has led many companies to evaluate their ad budgets more closely. It’s more important than ever for advertisers to drive performance, ensuring every ad dollar counts. As 2022 comes to a close and advertisers plan for Q1 and beyond, Frost Prioleau, CEO and co-founder of Simpli.fi, a portfolio company of Blackstone and GTCR, shares his thoughts on what to expect in the year to come.
FROST’S 2023 ADTECH PREDICTIONS & TRENDS: WHAT TO WATCH FOR IN THE NEXT CALENDAR YEAR
Doing more with less: advertisers will focus on enhancing advertising ROI success via transparency, given the current macroeconomic climate.
Increasing amounts of high-quality CTV inventory move into the open ecosystem as SVODs adopt advertising-based models for their subscribers.
The “democratization” of TV advertising will continue, with more small, local advertisers taking advantage of the improved targeting of CTV to make TV advertising work for them.
National advertisers will increasingly look to localize their campaigns in order to drive improved performance and gain deeper insights.
Retail media drives the growth of better identity solutions with higher match rates.
With the buzz around Artificial Intelligence from ChatGPT (and other GPT-3 models by OpenAI), more companies will use AI to improve and customize ad creative, contextual targeting, and landing pages.
THE STATE OF ADTECH & HOW THE MARKET COULD EVOLVE IN 2023
While the economy remains in flux, advertisers continue to focus on driving better returns at a lower cost to create more value. This performance-first approach requires platform solutions to provide a clearer advantage to advertisers through transparency efforts. While performance has always been important, shrinking ad budgets lead marketers to look to platforms to help them drive higher ROAS. In order to do so, this requires transparency at every level to understand what’s working and how to enhance the advertiser’s success.
Additionally, as more CTV advertising inventory come to market, advertisers will increasingly push for that inventory to be made available programmatically. This allows them to target, buy, and measure their buys consistently. Publishers also will find that bid density and prices in the open web ecosystem will deliver favorable economics in their efforts to maximize revenue.
Prior to CTV, local advertisers often had to buy across entire DMAs or Cable Zones, which was very inefficient for many local advertisers. With CTV advertising, local businesses now have the ability to target a few zip codes around their locations. This has led to a “democratization” of TV advertising, which will continue as more small, local advertisers take advantage of the improved targeting offered to them for CTV.
And in a programmatic advertising world, the cost to buy impressions in a single zip code is essentially the same as buying impressions nationwide. Because of this, national and regional advertisers, who advertised broadly in years past, can now eliminate waste by removing underperforming zip codes and shifting spend to highly-performing areas. This means that they can localize their campaigns to drive improved performance with greater insights.
HOW EMERGING MARKETS IN ADTECH CAN FACILITATE LONG-TERM GROWTH & EXPANSION IN THE INDUSTRY
Some of the hottest topics in the industry right now are focused on retail media and the use of artificial intelligence. In the world of retail media, these networks currently suffer from low match rates using the existing set of identifiers, making it difficult to execute campaigns on about half of their customers. In Frost’s predictions for 2023, he’s predicted that retailers will seek out more efficient identifiers to improve reach and measurement effectiveness.
He also predicted that the buzz around artificial intelligence will lead companies to implement AI-backed methods to improve their technology stack. More specifically, the emergence of ChatGPT, an Elon Musk-founded chatbot that recently crossed 1 million users one week after launch, will play a large role in this growth. ChatGPT, along with other GPT-3 models by OpenAI, will afford more companies the opportunity to use AI to improve and customize ad creative, contextual targeting, and landing pages.
Simpli.fi remains well-positioned to tackle these industry changes with excellence. Our award-winning programmatic DSP, inclusive of our superior targeting and attribution solutions, helps us lead the way. We hope to partner together to enhance your advertising success in 2023!
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