The respective marketing roles of Virtual Reality, beacons, and chatbots became clear in 2016. Here’s how the use of those tools are likely to evolve over the next 12 months.
1. Virtual Reality Became Real in 2016
VR finally became a marketing reality in 2016. As an example, Samsung’s Gear VR showcase with VICE at Cannes emphasized the incredible potential virtual reality provides, not only to consumers, but to advertisers, agencies and publishers seeking innovative new ways to connect with their audiences. AOL recognized this, too, acquiring RYOT in April. Unlike other marketing channels or platforms, VR enables fully immersive, interactive experiences that are essentially unmatched in terms of audience buy-in, enthusiasm and engagement. Still, very real challenges ultimately exist in scaling both the technology and the content. While it’s still early days for the category, 2016 showed us that the industry, at large, is now looking at VR seriously. VR investments will only grow to bring its potential into reality.
2. Improving Mobile Formats Remains a Focus
Over the past two years, mobile conversations have shifted towards a focus on improving ad formats. Last year, for instance, Facebook launched a new, interactive, full-screen mobile ad unit. We saw that trend continue this year, with Yahoo launching something similar. With mobile consumer adoption at an all-time high, even overtaking desktop, and more money being poured into mobile campaigns than ever before, advertisers, publishers and platforms are seeking ways to optimize campaigns by making formats more engaging, immersive and visually compelling. Data is also playing a key role in these changes. Many customers and partners are talking about the need for a more data-driven approach across mobile creative, to drive performance but also support attribution. In 2017, these developments could accelerate. With that said, we’ve also seen some advertisers go the other way. Some are focusing less on data, with a greater emphasis on the environment and context, getting straight back to creative. The goal is simply broader reach and branding, not necessarily performance.
3. Beacons for Customer Intelligence
Beacons offer a lot of value for retailers and marketers, with countless applications. Through geo-location data, beacons can enable real-time, personalized marketing in unique new ways. But the jury is still out on how impactful beacons have been in driving in-store sales or brand uplift at scale. Part of this is attributable to adoption – many marketers have been slow to embrace the technology. They’re still concerned about the backend infrastructure and how well that can be supported long-term. As investments have stalled, the value of beacons as an actionable tool has stalled in parallel. Still, despite these challenges, in the immediate-term, beacons have proven to be very useful as a customer intelligence tool. They help brands and marketers track and understand how consumers move in their neighborhoods, as well as through and around stores. While we’ve yet to reach the potential beacons provide in terms of delivering personalized ads in real-time, the audience intelligence we’re gleaning through them will only help us get there.
4. Chatbots a Big Opportunity for Brands
With Facebook leading the charge, chatbots finally mainstreamed in 2016. Among retailers and advertisers, mobile chatbots have been a hot topic. They’re increasingly perceived as an alternative to apps for brands as they’re not challenged by some of the discovery issues in app stores. They can also work across platforms and mobile devices by integration with popular messenger services. Chatbots signal a unique new form of “one-to-one” communications between brands and target audience. They reflect a more conversational and personal approach to commerce and engagement that consumers seem to crave more than ever. And as their capabilities grow in 2017, driven by companies like Facebook and Microsoft, we could be poised for a surge in end-user adoption.
5. Viewability & Fraud to Drive In-App Spend
Doom and gloom are common themes in advertising – but ad fraud and viewability are the real deal. The World Federation of Advertisers reported that marketers could waste more than $50 billion a year by 2025 due to endemic bot fraud. On the viewability side, even Google admits that nearly 60% of the ad impressions served across its network are never seen. The key distinction here, however – these numbers are largely focused on desktop display. Mobile is primed to benefit as marketers continue to be concerned about fraud and viewability issues on PCs. In-app advertising will especially see growth given its built-in advantages in safeguarding against bots and viewability. (Examples – app store vetting, user registration data collected at download, in-app ads can be seen without scrolling, etc.).
6. Retailers Still Challenged with Data Activation
Retail marketers have a love affair with data. They’re collecting, analyzing and optimizing customer data. But, the challenge isn’t necessarily in these areas. Now, retailers are faced with difficult task of activating against that data – implementing it to improve their business and grow revenue. Retailers want to have a “one customer view” through their datasets, isolating and predicting the buying behaviors of customers across channels, as well as the best media channels to reach those customers most efficiently. This is another way to streamline operating costs and develop more efficient go-to-market strategies. In 2016, the industry took steps forward in terms of technology – more self-service tools to eliminate learning curves – and education. But we’re still in the early days of activating data at the scale that most retailers need. The solution many are adopting and will likely continue to adopt in 2017 is bringing on more dedicated data scientists in-house to support marketing and operations.