Ogury: How the adtech industry could change post-pandemic

Ellen Daniel 26 June 2020 (Last Updated June 26th, 2020 11:17)

As many businesses face financial difficulty, marketing and advertising spending has been scaled down – especially in the context of cancelled events and remote working. Ellen Daniel explores the impact on the adtech industry.

Ogury: How the adtech industry could change post-pandemic

As many businesses face financial difficulty, marketing and advertising spending has been scaled down – especially in the context of cancelled events and remote working.

In their recent quarterly results Facebook reported a “significant reduction” in demand for advertising on the platform with Google's parent company Alphabet also reporting a “significant and sudden slowdown in ad revenue”.

However, now that many places are opening their doors again following lockdown restrictions, capturing consumers' attention is more vital than ever. In this context, there may be an opportunity for businesses to rethink their marketing strategies.

A difficult time for marketing

According to Marketing Toolbox, Adtech refers to the tools used to "strategise, set up, and manage digital advertising activities". It is increasingly seen by brands as a key way of running an effective ad campaign and capturing an audience's attention.

A study by AppsFlyer revealed that in-app purchases in the US increased 22% in April, with lockdown measures leading to a spike in internet usage in many regions. However, eMarketer estimates global ad spending will decrease by $21bn this year, and Campaign reported this week that ad spend is expected to decrease by 50% in April, meaning that brands hoping to capitalise on this must do so with a smaller budget. According to research by Marketing Week, just 7% of UK marketers surveyed are ‘seizing the opportunity’ and investing more in marketing.

As well as the economic hurdles presented by the current climate, the industry is also facing increased scrutiny for its data practices. According to research by MIT, UCL and Aarhus University, nearly two years on from GDPR’s introduction, only 11.8% of the consent and preference management platforms used by the 10,000 most popular UK websites meet the minimal requirements of GDPR.

In January, the Information Comissioners Office, the UK's data regulator, said it would crack down on the processing of user data real-time bidding, the process by which ad impressions are bought and sold through real-time auctions, which is not compliant with GDPR.

Ogury: "Users know their data has value"

Adtech firm Ogury, the creator of the "first advertising engine driven by user choice" is on a mission to rethink online advertising. It recently launched its new Video Chooser format, which allows users to pick their preferred video ad from a selection of three options, with brands only paying for an impression if a user sees their video. Mastercard, Bayer and ConAgra are all early adopters of the technology.

Ogury general manager Evan Rutchik believes that the adtech industry is changing.

"Previously, consumers believed the internet and its content were free while they were unknowingly paying for its use with their personal, sensitive information. Consumer behaviours are constantly tracked, with their data used, exchanged and even stolen without their explicit consent in order to bombard them with ads they didn’t choose to see. With little alternative options, advertisers and publishers were trapped fuelling an opaque, unethical digital ecosystem which forces user consent to obtain toxic user data," he said.

"Following the Cambridge Analytica scandal, users know their data has value, especially in aggregate. Thanks to data regulations such as GDPR and CCPA, a new trusted digital economy is emerging which empowers consumers with choice and control over their data. Users now expect transparency over how, when and why their data is collected and the ability to withdraw their consent to protect their privacy."

"These vital privacy protections are constantly evolving for the benefit of consumers. For instance, in August the advertising industry will see support for Version 1 of the IAB's Transparency and Consent Framework cut off. Version 2 will take its place which will provide consumers with greater power and granularity of choice, such as the right to object to their data being processed on the basis of legitimate interest. The adtech industry is moving quickly to an era of digital integrity and businesses need to keep up if they’re to avoid financial and reputational risk."

Maintaining "relevant and authentic relationships"

Consumer behaviour has unsurprisingly changed as a result of the pandemic, with streaming services, gaming and video conferencing gaining new prominence. A renewed focus on collective social responsibilities may also see brands adapt their advertising strategies.

According to the World Economic Forum, IAB data shows that 53% of advertisers are now increasing marketing that emphasises the mission of their company, with research from Kantar showing that 75% of consumers surveyed want brands to use marketing to communicate what they are doing during the pandemic.

Rutchik believes that advertisers and brands must adapt in order to maintain a "relevant and authentic" relationship with consumers:

"As the world adjusts to a new normal, consumers’ habits have changed and in many cases, radically. We recently completed some research with MediaCom to discover how consumer habits were changing to help brands adapt their advertising strategies post-pandemic."

"Over the past couple of months, we found eSports and social gaming apps, such as Discord and Twitch experience a much higher number of active users. Similarly, Grocery apps such as ASDA, Tescos and Morrisons saw a significant increase in user base as the lockdown caused many to avoid shopping in-store. Some of these changes in habits will over time revert back as lockdowns start to ease, many consumer mannerisms developed in this time will stick. Brands will need to adjust their advertising strategies accordingly to maintain relevant and authentic relationships with their consumers and emerge stronger from the current situation."

Rutchik said that brands should take this opportunity to re-think their adtech strategies, especially "outdated data sharing practices":

"During this time, brands should be taking the time to look at the way they engage their users. They should dismantle outdated data sharing practices and replace them with processes which prioritise user choice.

Brands should focus on data transparency to foster user trust which will drive better ad engagement without compromising brand safety. By interacting with users who’ve provided their genuine consent to sharing their information, brands will see revenue increase, boost long term user retention and maintain brand and data safety."


Read more: Brits more positive about technology following Covid-19 pandemic.