As marketers put the finishing touches on 2012 budgets and plans, it’s important to make sure they have been developed with an adequate point of view of the future.
While it’s impossible to predict exactly what will happen over the next twelve months, running through a few what-if scenarios will help to prepare for inevitable changes as they happen.
In this post, I wanted to highlight what I see as being some of the biggest trends and possibilities for 2012.
So here are five things marketers should look out for over the coming year...
Marketers need to get to grips with attribution
Throughout 2011, brands and marketers struggled to get their heads round cross-channel attribution and understanding what each channel brings to their overall marketing efforts.
This issue is showing no signs of disappearing over the next twelve months, especially as the number of available channels is continuing to grow.
As more channels make the attribution process even more complex, brands and marketers will need to start considering solutions that can help them keep track of where spend is being allocated, in line with the actual channel that a conversion can be attributed to.
Otherwise they are blindly designating budgets based on rough estimates, which is by no means effective. Expect the reality of a cross-channel attribution dashboard to come to fruition for CMO’s, so that they get a top-down view on how to allocate budgets.
Google will bring about even more new incentives and options for advertisers
While this may get an ‘obviously’ reaction, it’s still a crucial one to note.
After all, as costs-per-click continue to rise for Google’s ad networks, Google is at risk of driving incremental spend elsewhere.
For a long time, Google has been the main force to be reckoned with, but Facebook and the search alliance are both providing viable alternatives for advertisers when allocating their spend.
If it wants to continue capturing the lion’s share of new ad spend, Google has to continue innovating with its advertising products.
These innovations will include improvements to matching algorithms, which make more efficient use of ad inventory. Remember, quality score is an incentive mechanism, and one that Google can easily dial-up to drive behaviour.
Deeper discounts for advertisers that do a better job of managing quality scores will result in a heightened focus on optimising match types and negatives.
New ad formats and options will also play a role in increasing ad inventory for Google. There will be a vast amount of innovations in retail product listings, travel search, and local offers, creating high return opportunities for those first to take advantage.
Advertisers find themselves needing to make friends
Google “+1s” and Facebook “Talking about this” scores are just the beginning. In their quest to capture money from brands and improve ad relevance, Google and Facebook will begin to incorporate social likeability and sentiment measurements into ad rankings.
In response, advertisers will begin to invest heavily in promoting “+1’s” and “likes” to consumers via pay-per-click (PPC) ads.
Consumers will benefit as ads for more popular products and brands are presented more often. Suppliers of television or print media, on the other hand, will find themselves getting the short end of the stick as brand budgets are increasingly moved online.
Search outpaces apps for dominance in Mobile Marketing
While paid search already claims the largest share of mobile advertising spend, advertisers should expect this share to grow even more in 2012.
When it comes to mobile, tracking and analytics widely remains the largest issue for many advertisers.
Advertisers lose visibility as soon as a visitor clicks into an app marketplace or into an app, so tracking a click out from a mobile app using traditional analytics tools is difficult at best.
Rather than continuing to double-up on apps, advertisers will look to simplify their existing web experience for the mobile browser. HTML5 will play a role in this trend, making the power of application design available on mobile devices through a standard web browser.
As the mobile experience becomes more integrated into the website, advertisers will have improved visibility, allowing them to invest more in performance advertising and paid search.
Exchanges increase transparency, resulting in increased investment
Yahoo!’s recent requirement that advertisers have to have a seat on the exchange gave them better visibility into their customers’ media plans.
Expect more exchanges to follow suit this year. If requiring that individual advertisers have accounts proves too restrictive, exchanges may simply roll out separate pricing structures for advertisers vs. intermediaries through the use of API fees or pricing floors.
Customers will benefit from the improved visibility, receiving better insight in how much biddable media is costing them. DSPs and Trading Desks will be forced to respond with more transparent and standardised pricing.
Expect the percentage of media spend pricing models to emerge, increased investment, and a drive toward self-service platforms as advertisers become increasingly involved in the buying process.
As we get further into the New Year, we’ll see which of these trends and predictions play out.
If you have predictions that we missed, do leave them in the comments section below. Have a great 2012!