Advertising Guest Columns
4 mins read

(Don’t) throw caution to the wind! The challenges facing advertisers in 2022

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Advertisers had little reason to smile at the outset of the pandemic. Budgets were slashed to the bone, consumers became more cautious, and figuring out the ‘right’ message to push out was a multilayered challenge.

But it appears that, for advertisers at least, the worst of the economic impact of the pandemic is over. In fact, things seem to be looking up.

The recent release of the AA/WARC Expenditure Report confirmed a significant change in fortunes. Market value — following record growth of 26.4% — hit approximately £30bn in 2021, with the report suggesting 2021 was the ‘strongest ever year for the UK’s ad market’.

With all that said, new hurdles do lie ahead. Google’s decision to eliminate third-party cookies in 2023 has ruffled feathers across the industry, while news that the International Advertising Bureau (IAB) recently infringed GDPR indicates that navigating the evolving privacy landscape is far from simple.

The cookie conundrum

The advertising sector has demonstrated its versatility (and ability to survive) over the last two years. With forecasts predicting the UK’s ad spend will rise 8.5% in 2022, hitting around £32.2bn, it would appear that there’s just cause for optimism.

However, with cookies set to be a thing of the past within the next 12 months or so, advertisers need to ensure they’re fully prepared to deal with the consequences – and that means filling a cookie-shaped void.

Google’s recent flip-flopping regarding its cookie replacement – pivoting from the proposed ‘Federated Learning of Cohorts’ (FLoC), in favour of the new Topics API – illustrates the complexity of the problem, and the need to balance the needs of advertisers while respecting consumers’ right to privacy.

It’s expected that a third of businesses will increase their overall marketing spend during the next financial year, so while there’s clearly an appetite for fuelling growth and customer acquisition, it’s also clear that a different approach is needed – in particular, a shift away from heavy reliance on third-party ‘rented’ data and paid media channels.

Against this backdrop, it seems likely that marketers will increasingly prioritise the capture of first-party data to better understand customer behaviour and shopping habits, and to answer some of the questions raised by the end of third-party cookies.

Winds of change are blowing

Every challenge is, if viewed through an optimist’s lens, an opportunity, and the demise of cookies is no exception. Now’s the time for brands to reassess how they communicate with consumers, understand what messaging and channels work best, and give their customers experiences that will keep them coming back for more.

To that end, personalisation is key. 76% of consumers admit a lack of personalised interactions during the online purchase journey causes frustration, while 72% say they only engage with brand messaging if it’s tailored to them.

But to deliver personalised experiences – both on-site and in inboxes – retailers and brands need to start by recognising consumers effectively when they visit, and remembering their browsing interests and intent, across devices.

With the right technology in place, brands can then send personalised, triggered emails and text messages that relate to the customer’s specific browsing and purchasing history. This empowers brands to send content that’s not only relevant (a much better customer experience), but is much more likely to result in a conversion than traditional, generic marketing fired out en masse.

Speaking last year, Marcus Oughton, Head of Ecommerce for UK, RoI and EMEA at Clarks, detailed the footwear brand’s approach to Econsultancy:

“It’s a big thing for consumers to A, give up their data, and then B, allow us to use that to tailor their communications. When GDPR came into effect, there was a sense within the digital commerce community that this would negatively impact the revenue being delivered by email; however, I like many had an alternative view – ‘Let’s do the responsible thing, clean up the database, obtain further consent and drive higher engagement rates (and revenue) by communicating to those who want to be contacted.’

“Customer data is so valuable – both to the customer and to us. And that is, for me, one of the reasons why this channel needs to have maximum focus.”

The new normal

Advertisers have taken advantage of cookies for the best part of three decades. They’ve been an integral part of the digital advertising landscape, but nothing lasts forever – progress and evolution are inevitable, and can often present a valuable growth opportunity, beyond the initial operational headache.

Shoppers have become used to personalised marketing and advertising; it’s what they demand and expect. The gauntlet has now been thrown down to brands to deliver individualised, one-to-one communications to customers, but without the crutch of third-party cookie data to rely on. Building robust first-party databases – built on informed consent and truly engaged audiences – is central to achieving that.

Jon Halley
RVP Sales EMEA, Wunderkind

Wunderkind is a performance marketing channel that delivers one-to-one messages across email and text at an unmatched scale.