Marketers Find Alternatives In Light Of Digital Advertising’s Weaknesses

Digital and display advertising, as we know it, is on the ropes, reports research and advisory firm Forrester. In 2016, of $7.4 billion in spent on ads in the medium, only 40 percent was seen by an actual human and increasingly, consumers are finding ways to avoid it.

Ad-blocking software is increasingly popular, Forrester reports, with 39 percent of U.S. adults online having installed it. Furthermore, 50 percent of online adults actively avoid it on websites and 75 percent do the same for mobile in-app ads. Consumers' attitudes are reflected in display ads’ average click-through rate of 0.35 percent.

Forrester found that most consumers—56 percent—want deeper relationships with brands. This is a central tenet of promotional products’ appeal to advertisers—it brings their brand and message to consumers’ attention and through the items’ utility and perceived value, into their lives. The research firm Forrester expects advertisers to also turn to branded intelligent agents to help fill display advertising’s place. Technology like Amazon Alexa, Apple’s Siri, Google Assistant, Microsoft’s Cortana, intelligent agents, are smart go-betweens that stand between consumers and marketers, and provide the intelligent, conversational interactions and customized experience consumers are looking for. Most “advanced consumers” are expected to have adopted the technology by 2025, and brands are joining the existing platforms to collect customer data and insight.

This shift may hurt digital advertising heavyweights Google and Facebook most acutely, Forrester predicts. It notes that if the top 10 U.S. advertisers shift 10 percent of their advertising budgets to branded relationships, the current display ad model will lose $2.9 billion in business.

filed under industry-news | june-2017
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