With recession on the horizon and multi-device creativity at a premium, Pete Wallace, GumGum general manager EMEA, gives his predictions for 2023: walled gardens on a regulatory knife-edge, uncharted new digital environments and plenty of challenges for advertisers and publishers.

Walls come tumbling down?

It feels like the excessive power of walled gardens can’t help but be a big theme for this year - particularly given the growth of some and contraction of others. Certainly, the way these walled gardens continue to operate in arguably monopolistic ways - such as developing their own cookieless targeting solutions which are clearly self-serving - seems to put the user experience on a secondary footing.

One thing I would like to see, as a counterweight to all that, is a continued move towards open, equitable digital ecosystems that are user-first and sustainable, and within which it is possible to unlock appropriate targeting strategies. For an online world founded on the principles of freedom, anything else feels wrong.

In terms of predictions, when you look at the investigations in the US and Europe into the monopoly power of Google, for instance, it’s not beyond the realms of possibility that we will, at some stage, see Google broken up. Is this the year that really gets rolling? What does it mean for the industry if that happens? Either way, it really feels like this year needs to be one in which we all work hard to strengthen the cause of the open web.

Multi-device creativity to assume the same importance as data

In a world where we've been very, very data-driven for a long time, and where the nature of the available data is changing, brands are once again thinking a lot more carefully about their creative strategies. I would like creative in 2023 to establish itself on the same sort of level as data, the two working hand in hand with one another.

The M&A activity we see around us is always a pretty good guide to these things, and businesses that specialize in real-time delivery of creative design, as well as proliferation of creative for multiple devices, are clearly much in demand with a number of significant acquisitions in ‘22 - which hasn’t necessarily been the case for the last few years, when all the excitement has typically been around more purely data-driven businesses.

Advertisers learn to step back

More digital environments are being created all the time: there are plenty of gaming environments; CTV is another; the metaverse is of course another one - and an interesting question for 2023 is how you create advertising platforms around digital media environments that traditionally haven't been ad-funded.

Apart from very casual games, gaming has never been ad-funded; CTV has always predominantly been on the subscription model. The metaverse is very much just about gaming at the moment and again, people want to create an ad-funded solution. So what does that look like? And how do advertisers work through this challenge of being user-centric and creating an ad-funded model without being massively disruptive?

Creative is going to be key. This needs to be led by a sympathetic approach to the user and an understanding that they don’t want to be pulled away from immersive environments for brands; creative that aligns with the environment, will establish a clear value exchange and give long-term benefit to the advertiser.

Fair dues for quality content

I would like to see a new contract that acknowledges the value of quality editorial, because it clearly is enormously valuable, even if no-one necessarily thinks it is their job to pay for it. Therefore, it needs to be supported and established in a way that has longevity; whereby you accept that there is a value exchange between publishers, advertisers and users; where everyone appreciates the need for that quality content. But I also think there is a big conversation to be had around that, hopefully in 2023, because it’s fairly clear we’re not there yet.

Guidance for publishers: prioritize user-centric advertising

This isn't really a prediction as such, more guidance, but we need to see a lot more user-centric advertising: Fewer, better ads; creative that is impactful, and drives attention, but not so many different, cluttered ads on the page. Publishers, for example, need to clean up and start utilizing more quality creative executions and rely less on the application of cookie-led data. But then there also needs to be an acceptance from advertisers that they need to pay a premium for those publishers that align and deliver better experiences.

Recession planning - brands need to be careful how they cut

One of the most bullet-proof predictions for 2023 is that there is going to be a recession, if we're not technically already in one. So how do advertisers operate during this difficult period?

We’re on a path to real improvement in digital and brands can't deviate back to old tactics - they must continue to embrace change. Historically, in challenging economic contexts, marketers have either tended to reduce spend or increase direct response efforts. Yet reducing investment is a mistake. Time and again, research has shown that investing in the long term has significant benefits and can see advertisers through an economic crisis.

Meanwhile, an overemphasis on direct response advertising tends to leave advertisers relying on measurement models such as last click and last impression - neither of which are anywhere near as robust and effective as metrics such as attention.

Sustainability vs cost-cutting

Sustainability only continues to increase in importance, and I think we will see massive growth in the way it is applied across the supply chain - especially at the top, among the brands. For many of them, sustainable messaging is going to be a fundamental condition for success from this point on - although it will be interesting to see what people do around sustainability during a recession.

During a downturn, when costs are rising for everybody, will brands continue to live and breathe that sustainability message, and will they continue to push to the forefront? Those brands that stall on their path to a sustainable future for cost-cutting measures will surely lose out in the long term. Sustainability is very evidently one of the most important subjects for this year and the coming years, not just in our industry.

Also Published in: The Drum