OPINION13 January 2022

The evolution of online: the future of digital ads

Behavioural economics Opinion Trends

A shift has taken place in digital advertising and the way in which brands respond to it will determine the future of their relationship with consumers – and, with it, the very core of their business success. Elizabeth Lane outlines the strategies that brands need to keep in mind.

Digital UK

As our time spent online continues to increase – fuelled but not catalysed by the pandemic –consumers have grown ever-more digitally savvy, and more confident about the power they hold within the digital advertising sphere.

One of the most culturally significant findings to come out of IAB UK’s Real Living 2021 study, which sets out to explore the impact and effects of our changing digital lives, was the discovery that consumers are overwhelmingly clued up about how digital advertising works and the power they hold within that dynamic. The findings give us an insight into the acceptance of the mutually beneficial relationship that sits at the heart of digital advertising, allowing consumers to enjoy an abundance of high quality, free content online.

However, as advertising awareness has increased, so have people’s expectations. Our study found that 61% of respondents accept digital advertising in exchange for free content – knowing that watching or listening to an ad is a small price to pay for access to quality content – but they are clear on what they are willing to accept as part of that exchange. They want control over the ads that they see, they value contextual and personal relevance (to an extent) and they want to be rewarded for their attention.

Getting the balance right
Crucially, while relevance and interest-based ads are preferred, this should not give advertisers carte blanche to use and abuse the opportunities to target their audience online. One of the findings that supports a defining shift in the way marketers approach digital advertising is that 47% of regular connected television (CTV) watchers find it “unnerving” when ads on streaming services are too tailored to them

Advertisers’ ability to leverage data and personalise creative can be a hugely effective advertising technique, but take it too far and it will invariably have the opposite effect. There is a fine line between messaging that is clever and engaging and messaging that is simply creepy. Just because we can target people that closely, certainly does not mean we should.

If we are to successfully harness consumers’ openness to digital advertising, it’s crucial that we are attuned to how expectations are shifting. That’s not to say advertisers should just be more subtle in their approach – it’s a case of respecting the audience and the boundaries they demand.

So, as we enter a new era of digital advertising, one in which the online consumer is increasingly self-aware and confident of their role, it’s imperative that brands adhere to three key principles:

  1. Too much targeting won’t pay off: Relevant ads are preferred but targeting should feel natural and contextual to be effective. Using people’s names or showing you know where they live oversteps boundaries. Instead, ads should resonate with the environment they’re in, sensitively utilise interest-based data and be frequency capped – following people around is a sure-fire way of implying their information is being shared more than they might feel comfortable with. 
  2. Giving something back goes a long way: Actively rewarding people for watching or engaging with an ad is highly valued by consumers. Whether it’s giving boosts or credit for in-game ads or influencers sharing promo codes, people appreciate getting something back for their time – even if that’s just a moment of pleasure. Creativity in digital advertising should never be an afterthought. In a crowded environment it is what helps you stand out and get the audience’s attention. 
  3. Consumers want to have control: Above all, people want to be able to control the ads that they see. If an ad isn’t skippable after a certain amount of time, or it intrudes on the content they want to read, watch or listen to, people lose patience. Clever digital advertising can use short running times to their advantage – creatively engaging with audiences in the short window available ( 24 seconds in a browser and 109 seconds in-app, according to the passive tracking in our survey) without leaving audiences feeling frustrated or overwhelmed.

By building these principles into the creative process, digital advertising can and is delivering results for brands. The most effective online ads occur when brands strike the balance between making people feel special and making them feel singled out.

Don’t forget, the consumer is on to you: they are confident in what they think is acceptable and will not take kindly to anything that goes beyond that. Advertisers that resist the temptation to utilise all of the tracking and targeting capabilities at their disposal in favour of a balanced approach will be rewarded in both the long and short term.

Elizabeth Lane is head of research and measurement at IAB UK

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