The recent announcement of Apple joining the advertisement race and building its own demand-side platform (DSP) was quite surprising to many. Indeed, Apple is publicly known for being rather skeptical and critical of online advertisement, especially when it comes to user privacy matters. So why the change of heart?
Since the beginning of the year, the job ads and number of hires in the advertising platforms division skyrocketed.
In the May report, the company stated that the Apple Services group now has an executive director, Todd Teresi, who handles advertising-related initiatives.
Most notably, Digiday highlighted job listings that say Apple is building “the most advanced and sophisticated privacy platform possible.” This sounds like their own DSP.
Once again, what is DSP?
To explain what DSP is, we need to step back and return to the concept of the programmatic advertisement.
The programmatic advertisement offers an automated process of buying and selling online advertising. This makes transactions more efficient by optimizing the process and consolidating digital advertising efforts in one technology platform. Unlike traditional advertising, which includes requests for proposals, quotes, tenders, and negotiations, programmatic buying uses algorithmic software to buy and sell online display space.
The programmatic ecosystem comprises the different technology platforms, available advertising deal types, and methods of buying programmatic media and spans across various ad formats.
All components communicate and interact with each other and create
an ecosystem that allows making the process of automated media transactions more facile.
As a rule, each programmatic platform is owned and operated by either a publisher, an advertiser, or an intermediary.
DSPs allow advertisers to set up an automation that scales campaigns based on performance metrics using machine learning. As long as the platform is well designed, advertisers are happy and spend more.
DSPs also perform other functions, such as helping advertisers to accurately match the demographics of their intended audience, testing multiple ad campaign options with dynamic A/B testing, and ultimately optimizing and increasing spending on the most effective campaigns.
What to expect
This is not the first time for Apple to enter the advertising game. In 2010 the company acquired mobile advertising company “Quattro Wireless”. You may also remember iAd - Apple’s failed attempt at programmatic advertising. iAd was supposed to offer inventory available programmatically through open exchanges. Apple even announced in 2014 entering a partnership with Rubicon, MediaMath, Accordant Media, The Trade Desk, Adelphic, AdRoll, and others. Back then, it seemed like a promising and prospective beginning of the next ad giant! Suddenly, Apple rolled up the iAd project in 2016 due to data limitations and a lack of demand.
iAd case and the latest news about Apple’s DSP make asking the question: Will this time Apple’s attempt to get into the programmatic market be successful after such a dramatic fail? Looking ahead, yes, and there are many reasons why it will. Estimates are that Apple should make about $4B in advertising this year.
Apple has a huge advantage over the competition of being the owner of the popular iOS operating system. All those years, Apple has been building a complex system of connected products and services. These products and services are interconnected, which creates smooth consumer experiences. That is why Apple’s future DSP looks like a well-thought rational next step in this evolution. The company was building and expanding its advertising business behind the scenes, and now they finally revealed it.
Yet, Apple is giving very generous promises in their job posts regarding their future DSP platform:
“Our platform runs and delivers advertising auctions to match supply (customers) with demand (advertisers), focusing on technical components including Campaign Management, Bidding, Incrementality, Dynamic Creative Optimization, Matching, Auctions, and Experimentation, while empowering Customer Privacy throughout,”
Another interesting aspect of all of this is user data. Apple promises confidentiality in its actions and many times has already reported that privacy is a priority.
When Intelligent Tracking Prevention was introduced, it effectively disabled the usage of third-party cookies in the Safari web browser. Later, it ceased the mobile advertising identifier (MAIDs, or IDFA). Once App Tracking Transparency appeared, which allowed the user to control any ad experience by opting in or out of any track. The introduction of App Tracking Transparency was a clear win for consumers, but ad networks like Facebook and Snap have struggled to keep their ad platforms efficient. As a result, it is estimated to cost the industry tens of billions of dollars.
On top of that, Apple’s definition of “tracking” as a transfer of data to third parties means that its own personalized ads are not subject to the App Tracking Transparency, as this is
considered a transfer of data by the first party. So, users still will receive ads, but advertisers would have to pay “iPrice” for that.
That is how Apple first cut off Google and Facebook, which make up about 65% of all global advertising, by limiting their tracking and attribution systems while using privacy protection as an excuse.
It’s interesting to see whether Apple will get slammed by its users for monetizing their personal data for a premium price. Or whether US Federal Trade Commission will launch an antitrust investigation for monopolized advertising services.
Although, seeing how devoted Apple users are to the brand, there’s a good chance that Apple will get away with it.
Privacy rules are a strong tool for them to shut down competition while monetizing Apple user data all on their own.
Only one month of 2022 has passed, but it already looks very promising. In fact, the end of the last year prepared several innovative surprises for the advertisers. What innovations will bring 2022 into the marketing and advertisement industry? Let’s glimpse the interplay of the hidden and see what to expect from the near future.
2022, the year of the Tiger, will make the marketing industry Roar again. The global economic growth and the stabilizing impact of the pandemic will provide a favorable environment for marketing. At the same time, the privacy aspects, such as stricter GDPR laws and other privacy regulations, can fundamentally change the digital marketing approach of many organizations. Nevertheless, marketing spending grows every year, making 2022 a pretty advantageous time for the mar-tech and ad-tech industries.
Let’s take a closer look at the marketing trends in 2022. It is important to mention that some of the marketing trends will remain from 2021 and 2020 and continue to grow and develop. Meanwhile, there are also entirely new trends, which have the full potential to become the next gamechanger in the upcoming years. Metaverse is one of them.
Metaverse
In 2021 the concept of interaction in virtual reality became a popular topic of discussion in many sectors, including in marketing. Others have already started launching their services related to the metaverse and investing millions in this market. Will the metaverse create a revolution in the digital world, or is it just another overhyped trend – this year will show.
The metaverse concept existed long before Mark Zukerberg announced that Meta (former Facebook) would develop its own metaverse. Metaverse will broaden the opportunities for advertisement. It can create a new stage that will go beyond traditional advertising. Metaverse allows creating absolutely new experiences, which will be more engaging and interacting. At the same time, the ad in the metaverse will be less invasive than we usually experience with digital advertising.
The Metaverse market size is forecasted to reach about $800 billion by 2024 (comparison to 2020 with $46 billion).
Mobile marketing and M-commerce growth
Today, the average person spends about 7-8 hours looking at their mobile screen. Indeed, Mobile phones have become an undivided part of our life. And this fact broads the horizons of traditional advertisement.
It’s no secret that buyers more and more are using their mobile devices for online shopping. M-commerce acquired 72.9% of the total-commerce share in 2021. Moreover, this number will grow in 2022. In fact, M-commerce is more convenient for the users, at least that’s what statistics say. 85% of buyers prefer mobile apps to mobile websites.
Mobile-friendly design for shopping is becoming a priority with the growth of M-commerce. Already now, shopping apps developers create their UX first for the mobile version and only later adapt it to the desktop version.
Influencer marketing
Influencer marketing is continuing to develop and surprise marketers with a high ROI. One of the reasons for the high popularity of this marketing method is the study, which has shown that people trust influencers more than the information provided by brands. Moreover, another survey showed that half of Gen Z and millennials take the opinion of the influencers in social media before making a purchase.
The services and platforms which will identify influencers and measure their performance are gaining popularity. Even though influencer marketing cannot be fully automated yet, the platforms which provide the AI for facilitating influencer marketing can save time and, more important, money. Now the users would have to pay only for the conversions and sales.
Continues rise of the CTV
The amount of viewing on CTV has increased from pre-pandemic time. That can be explained that more people started to spend their time at home. Another explanation of the CTV rise is the accessibility to the new emerging entertainment and streaming services. For instance, when Disney+ was launched, it gained 54 million subscribers worldwide in less than 6 months. For comparison, Netflix needed more time to achieve the same numbers in the last years. The speed of streaming services conversion rate is expected to grow. The number of paid TV subscriptions in the US dropped by 2.7 million as people switched to streaming in the last few years.
Speaking about CTV advertising, it provides more opportunities than traditional TV advertising. Thus, CTV ad is more effective: viewers are 42% more likely to buy products advertised via CTV.
Programmatic product placement
We already wrote about product placement and its benefits. The biggest advantage of the product placement strategy is that this kind of ad can’t be skipped or muted. It is inseparable from the content and can stay in the show forever. Now product placement is becoming more automated and data-driven by moving into the programmatic world.
How will “In-Show” programmatic advertising work? The last year the companies TripleLift and Amagi declared about their partnership agreement to scale "In-Show" programmatic advertising. The companies with programmatic product placement services would provide SaaS platform access to the content owners, TV networks, and news/sport content providers. The SaaS platform will be integrated into the CTV ecosystem. Cloud-based services connect to dozens of consumer media platforms. The product integration will be available across hundreds of streaming TV channels in near real-time very soon, including Discovery Networks, Fox Networks, Fremantle, NBCUniversal, USA Today, Vice Media, Warner Media, and others.
Product placements on the video seem to be very promising. In 2021 it reached $23 billion.
Video and audio
Video content took off last year and brought fruitful results. 93% of consumers shared that video is helpful when they’re buying a product. This tendency will be kept for the next several years.
Instagram claimed that they are no longer a “photo-social media” and switched their focus to video content. In 2021 the reels gained their popularity. However, Instagram reels are different from TikTok by their identity and content. The main factor of such difference remains in the demographics: TikTok’s audience is younger than Reels’.
The preference for visual content will grow in 2022. According to HubSpot, 70% of businesses invested last year in content marketing, which, as a rule, includes visual efforts. By the way, more than 75% of video views are mobile 😉.
But what about audio? It may seem that audio advertisement has lost relevance with consumers fading interest in radio. However, the audio ad got a second life. Spotify launched its first-ever B2B audio campaign for Spotify Advertising (their new ad platform), and it proved to be more immersive and engaging than traditional radio and TV.
Moreover, audio advertisement is relevant when promoting audio services, for example, music and audio services.
The 2022 year looks very promising for the radio ad. People started to listen to podcasts more. According to the forecast, the number of US podcast listeners will increase 16.0% to 106.7 million in 2022. Moreover, this year, 16.5% of digital radio advertisements will be transacted programmatically. At the same time, the US podcast ad spending grew by 43,8% (from -17 to 26.8 billion dollars).
Zero-party data
The marketers will have to accept the fact that 3rd party cookies won’t be an option since the GDPR will come into force in 2023. Thus, the marketing agencies would have to find a relevant alternative that will be more ethical and at the same time effective.
The good news is that that solution already exists. As a rule, those are the framework produced by different tech companies. Another solution is so-called Zero-party (0P) data. Zero-party data are collected from people who voluntarily and proactively provide information about themselves to brands.
Zero-party data has a great advantage in that the information is transferred directly from the source (customer). No doubt, this method requires building a trust relationship with customers and thus requires more effort. Nevertheless, it can be a good alternative to the 3rd party data.
2022 looks very exciting full of new innovations and the comeback of technologies from the past. And this is only the beginning. Let’s be curious about tomorrow and look forward to what other innovations that will improve marketing will bring us in 2022.
This fall, new privacy features are coming from Apple with the iOS 15 update.
“Privacy has been central to our work at Apple from the very beginning. Every year, we push ourselves to develop new technology to help users take more control of their data and make informed decisions about whom they share it with. This year’s updates include innovative features that give users deeper insights and more granular control than ever before.”
Craig Federighi, Apple’s senior vice president of Software Engineering.
App Privacy Report
Most mobile applications require access to the microphone, location, camera, contacts, photos, and more. With the iOS 15 update, users will receive the App Privacy Report, which shows how often each app has used these permissions in the last seven days and indicates all third-party domains contacted by those apps to share their data.
Process Audio of Siri
The speech recognition of Siri will be processed by default directly on the iPad or iPhone. Some requests can even be processed without an internet connection.
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iCloud + Internet Privacy
This update includes iCloud Private Relay, Hide My Email, and expanded HomeKit Secure Video support. Private Relay makes sure to encrypt the traffic leaving a device. Hide My Email gives users more control over who is able to contact them. Finally, the HomeKit Secure Video ensures end-to-end encrypted storage for video footage.
Several updates will directly influence digital marketing.
Third-party cookies blocking
“Cookies for cross-site resources are now blocked by default across the board [in iOS 15]. This is a significant improvement for privacy since it removes any sense of exceptions.”
Apple’s WebKit privacy engineer, John Wilander.
The Intelligent Tracking Prevention “is getting even stronger by also hiding the user’s IP address from trackers. As stated in Apple’s press release, “this means they can’t utilize the user’s IP address as a unique identifier to connect their activity across websites and build a profile about them”. The IP address will also be hidden in the Mail app, thanks to Mail Privacy Protection. This way, when a user receives a marketing email, the sender cannot know anything about your location, what you do online, or if you opened the email or not.
The blocking of third-party cookies by Apple and Google started to re-shape the digital marketing industry over the last months. Unlike Adello, which used advertising ID instead of cookies from the very beginning, many AdTech and MarTech solution providers had to reinvent the way they run their technologies. They had to go cookieless by collecting information from the browser like the version, plugins, screen resolution, IP address, etc. Well, now we know that the collection of IP addresses will soon be impossible on Apple’s devices. Moreover, email marketing will have to work with less information about its iOS subscribers.
Challenges always open new opportunities for marketers to change the game and find new ways to effectively reach out to their customers. Use your creativity to shape the future of your advertising strategy, and do not hesitate to contact us for third-party cookies alternatives 😊
Just a decade ago, sci-fi movies showcasing self-programming computers were closer to a dream than reality. Nowadays, we are fighting a war against online data privacy while talking to Alexa and being astonished that an app or website displays advertisements of (related) products we just searched for. Artificial Intelligence (AI) has already been introduced into all segments of our lives, business, education, medicine, etc., and rapidly taken the leading position among the main driving technologies of our times.
“In our business, we talk about emerging technologies and how they impact society. We have never seen a technology move as fast as AI has to impact society and technology. This is by far the fastest-moving technology that we have ever tracked in terms of its impact, and we are just getting started.”
Paul Daugherty, Chief Technology and Innovation Officer at Accenture.
The digital advertising industry is undergoing a significant progressive transformation with AI, adapting this technology to its needs. In fact, AI transforms digital advertising in many ways, from personalization to customizing content to enhanced reporting. Thanks to automation, many manual and repetitive tasks can be substituted by AI, improving workflow and collaboration among teams.
Machine Learning (ML) – being the central theme of AI, offers a variety of benefits:
AI and Big Data in Mobile Advertising ROI
An experiment conducted by the Alibaba Group and the University College London proves that algorithms perform far better than humans. The data showed that where manual bidding achieved an ROI of 100% with 99.52% budget spent, 340% ROI was generated with 99.51% budget by algorithmic bidding. So, it is obvious who is winning in this highly competitive environment!
Algorithms not only analyze the broad demographic data but also incorporate real-time online browsing behavior to effectively group and cluster the audience. This way, they create a rich user profile to pursue a niche audience for your product much faster and more precisely than a person ever could, boosting your ad performance. For example, Adello AI’s multiple-award-winning Technology AdCTRL™ computes data combinations >100,000 times/second to understand what made potential customers convert.
Automated creative building and reporting
There are self-service platforms out there that enable marketers to build their mobile ads efficiently. On Adello.Direct, for example, marketers can use Ad Unit builder to create stunning creative formats such as award-winning Cube or interactive ads such as Booklet or Peel. All they need is only to do is upload the pictures on the platform, and the creative is ready to go. Adello’s patented AI enables you to go live with a mobile advertising campaign in just a couple of clicks.
Creative reporting provides unique insights into user interaction behavior with ad creatives. The heatmap below indicates the user's click pattern. The darker the color, the more clicks users made in this part of the ad unit. Our AI makes decisions on audience targeting improvements and inventory choices based on such heatmaps collected from different publishers.
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AI in mobile ad-fraud
The issue of mobile ad fraud, such as bot fraud, device farms, etc., has increased from 2019 to 2020 by nearly 200%. To monitor, analyze, and spot abnormalities in the real-time incoming data 24/7 manually is nearly impossible. With its capability of big data analysis in real-time, an AI-driven fraud prevention system can recognize invalid traffic, bots, and malicious applications with even a small sample size, thus saving campaign budget.
As Dr. Augustine Fou advised in an interview for AD.Insider, before choosing a fraud prevention partner, marketers should answer the following two questions:
1) Do they have different tags for in-ad versus on-site measurement?
2) Do they measure for humans, in addition to measuring for bots/IVT?
If both answers are negative, their job is not good enough, and you need to look further.
Advanced reporting and valuable insights
AI-driven technologies play a crucial role in organizing high-performance ad campaigns. They combine machine power, excellent cognitive skills, the ability to analyze large amounts of data, accurate calculations, predictions, and delivery of almost real-time reports in presentable and easy-to-interpret formats.
AI is mainly engaged in analyzing Big Data and making decisions and predictive analytics based on it. With every analyzed data byte, AI creates new algorithms and, by “learning” independently, improves its capabilities. As a result, AI has achieved tremendous progress and lasting results since its introduction to digital advertising.
And the disadvantages?
The dark side of the advertising industry does not sleep. While algorithms optimize campaigns, viewability, placement, and engagement, digital advertising is also vulnerable to fraudulent attacks. Approximately 25% of campaign spending is flushed on fake bots, device farm downloads, or other fraudulent activities. So, to avoid losses, make sure to do business with ad tech companies, which use AI and ML to detect, fight, and prevent fraudulent traffic. For example, Adello uses multiple-awarded AI with complementary integrated fraud prevention for its operations. This way, Adello’s clients identify and reach out to real people, save up their marketing budget, and grow their business.
Do not hesitate to contact us to learn more about mobile advertising for your business 😉