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DEVELOPMENT, 6 MIN READ

AdTech: Digital Trends
of 2020 and Beyond


ADTECH: DIGITAL TRENDS
OF 2020 AND BEYOND
DEVELOPMENT, 6 MIN READ
ALEX SLOBOZHAN

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It's been over 25 years since digital advertising was created. Web cookie and the first-ever online banner saw light in 1994, and three years later, the equally loved and hated pop-up first appeared. In over two decades of online surfing, users have become so accustomed to the ever-present advertising, they perceive it as nothing but white noise. Still, marketers and sales managers across the globe devise new ways of attracting customers and enticing them into parting with their hard-earned money. As a result, Adtech software development and ongoing evolution have become the primary drivers of digital marketing success.

Whether you want to adopt advertising technology (AdTech) to boost your profits or create a startup servicing existing businesses, you will need all the help you can get. I'm here to explain the current state of affairs and highlight the AdTech 2020 trends you can't afford to miss.

Programmatic Advertising Market at a Glance

Programmatic advertising has dominated digital marketing for years seeing significant growth year-to-year. However, the unexpected healthcare and economic crisis of 2020 disrupted expectations and analysts' predictions. For instance, in a recent report, eMarketer had to adjust the expected digital ad spending of 2020 in the US from 17% to a mere 1.7% ($22 billion to $2.2 billion). While the triopoly of Google-Facebook-Amazon will continue to rule the market, the search giant is expected to lose revenue, while the other two companies are supposed to increase their market shares.

The growth of digital ad expenses is not reliant on search ads, but display advertising instead, as the video remains the most sought-after media among advertisers. Traditional media channels, such as radio, print, and TV, will see a slump, losing profits in the double-digits.

Compared to March eMarketer forecasts, June predictions are less optimistic. Still, the analysts predict the expenses on the digital ads will continue to grow throughout 2024, even if the ascending trajectory won't be as steep. US expenses of 2020 are expected to exceed $134 billion and should reach $225 billion in 2024.
Digital Advirtisment Ad Tech 2020 statistics
The forecasts for digital advertising expenses across other economies, including the UK, France, Germany, China, and others, showcase similar trends. Although the predictions had to be adjusted to the current reality, the AdTech software development will remain a profitable niche, considering the ever-increasing expenses in the coming years.

4 AdTech Software Development Trends to Watch in 2020

2020 ruined many calculations and predictions, but AdTech is among the few industries that benefited from the crisis and continued a steady ascent. I believe these four trends are spurring the growth momentum.
Machine Learning

From its inception, artificial intelligence (AI) in programmatic AdTech was focused on identifying the best bid opportunities for ad buying. Smart algorithms helped marketers create efficient campaigns with increased reach without going over the budget. The adoption of omnichannel marketing across devices and platforms further increased the use of artificial intelligence in advertising.

However, recent developments in big data analytics caused more companies to use AI as a way to sort through the user data and develop actionable strategies based on the insights. Better ad campaigns mean better customer experience, increased return on investment (ROI), brand loyalty, and a multitude of other benefits.

While humans can perform these tasks with more creativity, they are usually unable to handle the volume of data. After all, in 2017, the combined data output of the world exceeded 2.5 quintillion bytes per day. By 2020 there will be 40 times more data bytes than stars in the observable universe. Big data is growing and not slowing down, and Ad Tech companies need to embrace the power of machine learning (ML) for data analysis before marketers get overwhelmed by information overflow.
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Source: web-assets.domo.com
Customer Data Handling

While smart algorithms can solve the data processing issue, their results are only as good as the data input. Businesses and AdTech software development companies have to focus on customer data acquisition and handling to prevent errors, inconsistencies, and the database errors they cause. 'Dirty' data can make the whole set unusable and even harmful to marketing efforts. The transition from third-party to first-party data acquisition is one possible solution to this problem, though it comes with compliance concerns as both GDPR and CCPA have come into effect.

While many businesses steer clear of handling sensitive customer data or ignore regulations altogether, GDPR-compliant customer data handling is at the heart of most top AdTech companies already present or just entering the market.

When considered as a differentiating factor and potential advantage, compliance can bring surprising benefits.

According to Capgemini research, few companies are fully GDPR compliant, but those that are have seen significant improvements compared to their competition. Among the critical dimensions impacted by GDPR compliance were:

  • Improved customer satisfaction and resultant increased rating;
  • Better brand image and reputation leading to deeper customer trust;
  • Improvements to targeted marketing leads causing revenue growth.
GDPR AdTech infographic 2020
Metrics Standardization

The AdTech includes a variety of stakeholders with publishers and advertisers at the two opposing ends of the supply and demand spectrum. Both sides are equally interested in setting basic rules of measuring advertising campaign efficiency. Publishers can get more value out of their portfolio, while advertisers can enjoy the improved lead quality and higher ROI.

On that note, impressions are falling from grace, as ads might be loaded but never viewed by the end-user. Instead, viewability is becoming more widely adopted. It indicates the ad being within the user's view. Google's adoption of the Open Measurement standard for mobile advertising campaigns is another step in the right direction, as the code libraries provide easier access to ad efficiency measurement data invaluable for advertisers.

Any ongoing and future AdTech software development should account for the changing metric landscape of the advertising market and incorporate the newly-adopted industry standards. The data can then be used by the ML algorithms to select optimal bids or design targeted ad campaigns for individual customer segments.

Endless Potential of 5G Ads

The long-awaited widespread adoption of 5G starts in 2020, and it will be a game-changer for many industries, AdTech included.

Lightning-fast mobile Internet means lower latency and broader opportunities for advertisers to use both conventional media and new technologies, such as virtual reality advertising and responsive video stories that change and adapt to users' responses.
digital video app slending in UK statictic 2019 2020 2021 2022 2023 2024 AdTech

Moreover, faster mobile Internet will affect other connected devices, including IoT gadgets, smart appliances, and vehicles. Advertisers will get access to new promotion channels and an enhanced toolbox. Creating an extended or augmented reality ad that offers seamless immersion can finally be possible thanks to 5G adoption. Unlike the stale online pop-ups and banners, new advertisement types might produce significantly better results, getting new customers interested in the brand or product, building their reputation, and boosting the number of leads and conversions.

Just take a look at how excited Uber AR ad made the passengers at Zurich main station:

Precise geolocation and targeting, while less glamorous than the creative side of the equation, should not be discounted. Both are crucial for reaching the right audience and increasing campaign ROI.

The Takeaway

AdTech software development is a promising niche, whether you plan on using the solution internally or setting up a SaaS business. And partnering with FreshCode is an easy and reliable way to benefit from AdTech tools, as we stay on top of the latest trends and technologies. According to our research, the essentials you need to know in 2020 include:

  • Digital advertising, along with AdTech expenses, will continue to grow throughout 2024 at a slower rate caused by the global crisis.
  • Machine learning algorithms are replacing human marketers when it comes to data analysis and campaign optimization.
  • Quality first-party user data and GDPR-compliance are essential for efficient AdTech solutions.
  • Digital advertising metrics are undergoing standardization, and AdTech startups should stay on top of the changing industry standards to accelerate their adoption.
  • The widespread adoption of 5G across the US and other countries opens new promotion channels and enables AR, VR, and XR advertisements, as well as more precise targeting.

It's no wonder that companies implementing AdTech digital tools will experience great benefits.

Check out Freshcode development services to stay ahead of the future business challenges. Here you can book a free consultation.
Things we do next:
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  • We collect all the necessary requirements from you

  • The team of analysts and developers prepare estimation

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