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The year ahead? 2016, only more so

The last 12 months has been a year of profound change: self drive cars and virtual reality all made leaps forward. So did artificial intelligence. Early in the year Google’s AlphaGo program beat Lee Sedol, the grandmaster of the Chinese board game Go. Machines, it seems, are smarter than humans. But human endurance prevailed at the Rio Olympics, with Usain Bolt, the world’s fastest man, running away with three gold medals.

Of course, it wasn’t all good news. Thailand lost King Bhumibol Adulyadej, the world lost David Bowie, UK decided to lose its place in Europe, and Samsung lost market share as their Note Sevens were running hot, but not in a good way.

In the media industry ad blocking was the topic de jour and Asia, slow on the uptake, is now leading the charge. A report by PageFair reckons more than a third of smartphone users in the region are automatically blocking ads. That’s a sobering thought to end the year with.

The point is this. Change happens. Every year, every month, every day. And it’s often seismic. So, what will change in 2017? Well, it seems simplistic to say it’ll be more of the same, but that’s the case. Many of the trends reinforced in 2016 will continue, and gather pace, over the next year.

More mobile
According to the GSMA, mobile broadband subscriptions grew more than 10 percent this year in Thailand, Malaysia, by more than a quarter in Indonesia and by almost a third in China . Those figures will grow in 2017 and, even those markets that have reached saturation point, existing users will download more. Cisco forecast that mobile data in China, India and Indonesia will grow each year by 64 per cent; across the region smartphone mobile traffic will grow by 55 per cent each year from now to 2020.

The ‘phone’ element of smartphones is becoming less important; these devices are now an entertainment screen, an image sensor, and a wallet – to name a few. Looking at these unique capabilities of mobile, some of the more exciting areas of opportunity we see come from the emergence of new ad formats – in particular 360, virtual (VR) and augmented reality (AR) and live video, which will all become ubiquitous as we enter an era of 5G. All these developments will enable marketers to reach mobile users in more diversified, sophisticated and holistic ways.

More video
Growth in video, and mobile video especially, has been exponential over the past two years. According to Cisco’s Visual Networking Index (VNI) 2016, having already surpassed 50 percent last year, three-fourths of the world’s mobile data traffic will be video by 2020. Next year that growth is expected to grow by an 11-fold increase once again. This growth is being helped by faster speeds – the wider availability of 4G and soon, even faster speeds with 5G connectivity. Cisco predicts average mobile connection speeds in Asia Pacific will rise from 4.6 Mbps in 2016, to 5.7 Mbps next year, and up to 7Mbps a year later,

Sight, sound and motion remain one of the most engaging ways to reach consumers across any device. Hand in hand, video and mobile are going to dominate media in 2017 and for many years to come. Along with the aforementioned 360, VR, AR and live video, I hotly anticipate new video technologies to be adopted by consumers and shake up the way we marketers think about trying to engage them in 2017.

Publisher power
In the past, most technology platforms in the ad ecosystem have been developed as advertiser-first. However, in 2016, we saw stronger tools emerge for publishers, giving them more flexible platform technologies, more consumer-centric formats and advanced targeting capabilities. This has helped them move from being largely direct response-focused. Now, they can deliver on the KPIs that advertisers want.

Header bidding and automated price floor optimisation (PFO) are a couple of the better examples. Both have become more prevalent in the last 12-18 months, helping publishers boost their own yield. And they’re doing it through programmatic. Before, there was sometimes a hesitance to push inventory through those tools. But now they can do that because they can secure a premium or the best price for each impression in real time. As traffic continues to be consumed off platform, technology platforms will become ever more important in solving the monetisation piece for publishers continue to improve how publishers actually get paid fairer prices for their own content in the coming year.

Data matures
In 2016, we saw brands and publishers step up to improve consumer touch points by creating quality ads and content that audiences find valuable, personal and relevant. This is in part because consumers are increasingly mobile, and marketers need to reach them where they are through improved premium ad experiences while giving them control if they are to successfully engage.

This is a trend that will continue as creatives will move more quickly to fully embrace data as a foundation and guiding force, using it to develop concepts that directly align with the value audiences seek in their content, and understand how technology can be utilised to create personalised experiences, in order to keep up with the industry. New technologies will reshape video, mobile advancements will unlock personal touch points, and an emphasis on the consumer will drive the industry forward.

Accountability & trust
The C-suite is demanding as much accountability from their marketing investments as they are for all other types of investments, and CMOs are under pressure to deliver measurable ROI. The growth of technology into advertising has simultaneously created new threats to media accountability as well as opportunities for advertisers to show more actionable information.

In order for CMOs to answer these demands, they need to trust that investments are not wasted on fraud and can be effectively evaluated across channels. As such, media and tech providers need to enable brands and agencies to use preferred measurement vendors of choice, and not lock them into a ‘walled garden’. Expect to see an increasingly vocal industry push for more open transparent working relationships that are accountable and ensure trust.

Alex Khan

Alex Khan is the Managing Director APAC at Smaato.
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