The State of Digital Marketing Strategy in 2021

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Frustrated with privacy breaches and ever-more-intrusive digital advertising, consumers are taking control over their ad experience like never before, changing their privacy settings, using ad blockers, and welcoming changes like iPhone’s iOS 14 rollout that will require apps to get permission before tracking users’ searches and other data. What does this shift in both mindset and technology mean for businesses that rely on an effective digital advertising strategy to reach their customers?

How Many Consumers Are Opting Out of Digital Advertising?

How many iPhone users will opt-in to data collection?

There are an estimated 110.3 million iPhone users in the United States in 2021. Of these, how many will offer up their information when the iOS 14 update requires apps to obtain permission before collecting data?

While it’s possible that some users will agree to share information some of the time, it seems that most people will simply say no once it’s easy to decline. Facebook expects a more than 50% decline in Audience Network revenue, and the company has expressed concerns about its own revenue when advertising becomes less effective.

“We know this may severely impact publishers’ ability to monetize through Audience Network on iOS 14, and … may render Audience Network so ineffective on iOS 14 that it may not make sense to offer it on iOS14 in the future.”

Facebook blog post

How Many Users are Employing Ad Blockers?

In 2019, almost 30% of internet users enabled ad blocking software at least some of the time. They cited reasons that include:

Ad blocker adoption is expected to continue a slow but steady rise.

Are Users Abandoning Social Platforms Like Facebook?

Facebook lost 2 million daily active users in the 3rd quarter of 2020, and its role in ongoing political and privacy controversies has since caused further erosion. Alternative platforms like MeWe.com (which promises no ads, no spyware, and no newsfeed manipulation) and Gab.com (which is user-funded) have seen tremendous growth in 2021. 2.5 million users flocked to MeWe in just one week in January and Gab has been offline occasionally as it works to accommodate a continuous influx of traffic.

How Are Search Preferences Changing?

Although Google continues to dominate the search market, alternatives have grown in popularity as the tech giant has moved away from its “don’t be evil” code of contact and into far more revenue-driven territory. However, like Facebook, Google will need to make adjustments to its privacy practices in order to comply with Apple’s next update, and those changes are likely to impact advertisers in a negative way.

How Can Advertisers Counteract Ad Blocking?

Where do users of ad-blocking software find out about brands?

With less-targeted advertising poised to decline in effectiveness, marketers can turn to the above options to reach their target audience. While some options are costly and others will require a bigger time investment to succeed, they offer more organic ways to connect with users – without annoying them the way many digital ads do.

What About Paying Users for their Data?

Specific information freely provided by users is highly valuable to advertisers. Have we reached a tipping point at which platforms will begin to compensate users for their data? Former presidential candidate Andrew Yang and lawmakers like Sen. John Kennedy (R-LA) support granting people property rights to their data and requiring companies to pay for access. The Data Dividend Project, primarily based in California, is one such effort to pay people when companies use or sell their information.

In 2012, data buyers were purchasing in bulk at less than $0.01 per profile, but the Internet Advertising Bureau said the advertising ecosystem supported $300 billion in economic activity, making user data worth $1,200 per profile.

Similarly, Brave offers a browser that blocks ads while claiming to speed up load times and use less battery, going one step further and allowing users to earn rewards by viewing occasional ads that have been deemed safe by the site. The privacy aspects are similar to many other privacy-minded browsers, but when the rewards system is rolled out in full, it will be a unique difference.

Are you struggling to keep up with changing trends in data, privacy, and advertising? We can help you find an effective strategy to reach your audience – without making enemies along the way! Contact us today.

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Digital Advertising Duopoly

The Digital Advertising Duopoly & You

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If you’ve ever run a digital marketing campaign, chances are you used Google Ads or Facebook to promote your business. Collectively, Google Ads and Facebook made up 60% of the U.S. digital ads market in 2019 and in spite of reports of advertisers abandoning Facebook both platforms will likely maintain their continued dominance for the foreseeable future.

Where once digital advertisers were overrun with choices for allocating their ad budgets, in 2021 the duopoly’s lack of choice can feel stifling. What does its dominance mean for digital marketers? Can we avoid two of the industry’s key players, or will we spend more years looking for ways to make these commanding platforms work for us?

Why Do Google and Facebook Dominate Digital Advertising?

The short answer is reach.

By some estimates, 90% of internet sessions begin with Google.

Facebook, in spite of recent reports of user loss, still logs 2.74 billion monthly active users on its platform. By comparison, Twitter, another tech company name brand, only counts 353 million monthly visitors.

In addition, users are far more likely to make a purchase from Facebook (and Instagram, which is owned by Facebook) than any other social media site.

Is Google and Facebook’s Dominance Bad for Marketers?

Like anything, it’s a double-edged sword. Google’s search dominance makes it the ideal platform to introduce your brand to people who don’t know what they’re looking for. But that same dominance means that advertising costs will increase at Google’s mercy, and though cost-per-click appears to have rebounded since the start of the pandemic, we predict it will rise as the economy recovers. What’s more, as Google seeks to grow revenues the search quality is declining, meaning that those brands that can afford to reach the top of the ad heap are pushing down organic results and smaller advertisers.

Facebook is another story. There’s mounting evidence that Facebook’s targeting is much poorer than it has led advertisers to believe, and a recent lawsuit claims that Facebook has used false reach metrics to overcharge advertisers for years.

Beyond Google Ads & Facebook: The Online Marketing Landscape in 2021

Google and Facebook may be the top two by a landslide, but other advertising platforms are gaining some ground. Amazon, advancing as a minor threat to the duopoly, recorded $11.33 billion in advertising for 2019 and grew again in 2020 with 51% year-over-year growth in the “other revenue” bucket that includes advertising earnings. Other players also had strong showings in 2020, including:

  • Pinterest
  • Twitter
  • SnapChat
  • LinkedIn
  • Tik Tok

S&P revealed some interesting growth into 2019 with marketing platforms outside of the duopoly gaining more revenue.

Despite the global pandemic upsetting some digital platforms in 2020, there was a general sense of recovery and even improvement for many platforms by the end of last year. Pinterest, for instance, reported record engagement in early 2020 as people sought out ways to stay busy and productive at home.

Advertising on Google & Facebook: Do We HAVE To?

Though Google and Facebook are clear industry leaders in advertising revenue, marketers don’t have to advertise through their platforms. However, the current state of the market is such that avoiding the two key players means working harder to identify your audience and zero in on the right places to connect. Marketers who don’t want to play in the duopoly will need to carefully consider the following when planning their campaigns:

Where else is your audience? B2B companies are likely to find key decision-makers on LinkedIn, while retail products can expect some success with Amazon. Products aimed at younger generations can explore Tik Tok or SnapChat for a relevant reach.

What do you need to make your advertising work? Google Ads offers the opportunity to use straight-forward text to get your message across. Other platforms may necessitate developing video, beautiful imagery, and even quirky messaging that will catch the eye of a Generation Z audience.

Can you afford to step away? Google and Facebook have the audiences. They have easy-to-use marketing platforms that reach the majority of the U.S. population. You can expect a certain level of performance for your ads while other platforms are less predictable.

Lack of choice is frustrating for marketers, but we do see some light at the end of the tunnel. Check back next week for the second part of this series, where we explore digital privacy concerns and how they have the potential to upset the digital advertising duopoly for good.

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