Team MAG: 2023 Industry Predictions
The past couple of years have been unpredictable to say the least, but here at MAG, we are interested in how unpredictably shapes our industry and how we overcome challenges and utilise opportunities to push the best campaigns out into the world, despite everything. With that being said, I sat down with three of Team MAG, all with the very best expertise in their field to find out their predictions and projections for the advertising industry in 2023.
Beatriz Gonzalez, Head of Digital:
It’s not unusual that the digital space is constantly evolving, we saw that this year with the metaverse, but what changes would you say will continue into 2023?
In the digital space we’ve seen ample changes across the board. Some changes leading the way in 2023 will be the rise in social commerce, short-form video with TikTok at the forefront, automation trends across platforms, and a big shift of Connected TV consumption from mobile.
If you were to describe 2023 for digital advertising in one word, what would that be?
Self-discovery.
Ooh, interesting! Why self-discovery?
Well, it'll be a year of self-discovery because 2023 will be the year 3rd party cookies are finally phased out. Digital has been really dependent on 3rd party cookies to track customers and inform their targeting strategies, but next year we’re going to have to scrap what we know and learn and test out new and innovative ways of targeting customers moving forward.
Steve Arklie, Trading Director:
What do you predict is in store for the industry next year?
Going into 2023 feels similar to the last few years with uncertainty around a potential recession, however recent experience of covid and the effects on the advertising industry has taught us that this presents an opportunity for both short and more importantly long term growth for brands who dare to be brave enough to maintain or even increase marketing budgets.
From a brand perspective, what opportunities can an economic slowdown reap?
That’s true, but there are several reasons to advertise during an economic slowdown.
The “noise level” in a brand’s product category can drop when competitors cut back on their ad spend. It also allows for advertisers to reposition a brand or introduce a new product. A prime example of this is when Amazon sales grew by 28% in 2009 during the “great recession.” The tech company continued to innovate with new products during the slumping economy, most notably with new Kindle products which helped to grow market share. In a first, on Christmas Day 2009, Amazon customers bought more e-books than printed books. As a result, in the minds of consumers, Amazon became an innovative company by introducing a lower cost alternative to cash-strapped consumers.
Brands can project to consumers the image of corporate stability during challenging times.
The cost of advertising drops during recessions. The lower rates create a “buyer’s market” for brands. For example, studies have shown that direct mail advertising, which can provide greater short-term sales growth, increases during a recession.
We’ve spoken about brands, but what will consumers be looking to in times of economic hardship?
Value. Consumers are likely to seek out the best value brands can offer them.A strategy that could be used is changing the ad message and using short-term price incentives to match the economic climate with consumers who are seeking a good deal.
We’ll also see advertisers offering interest-free loans, coupons or special promotions to boost sales and market share. And when the economy bounces back, regular pricing can return. For some advertisers that don’t give cost incentives, they can change the ad message to emphasise that the price is worth it.
Perhaps the best quote about advertising in a recession came from Sam Walton, the founder of Wal-Mart. When asked, “What do you think about a recession?” he responded, “I thought about it and decided not to participate.”
Amy Roberts, Head of Planning
As for the TV landscape- you can find Amy’s thoughts over here, when she sat down to talk to Prolific North in an exclusive feature!