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10 digital marketing trends to watch in 2016 and beyond

The customer experience will be a big focus for marketers and advertisers in the new year

If there is one thing we learned from 2015, it’s that marketers in 2016 and beyond will need to focus on improving the customer experience and marketing in a digital-first world.

Last year, we saw emerging channels like mobile, video, and social media gain traction among brands and advertisers. Meanwhile, issues surrounding ad viewability and ad blocking became even more apparent. Going into next year, the marketing and advertising community will need to find solutions that satisfy all parties: publishers, marketers and especially consumers.

In 2016, the most important move that marketers may make is meeting consumers where they are, instead of on marketers’ terms.

Here are the top 10 digital marketing trends shaping the future of marketing in 2016.

1. Digital has become a top priority for marketers while traditional channels lag

As digital ad spending soars and spending on traditional media stagnates, digital media will be an even greater focus for marketers in 2016.

"Pervasive changing customer behaviors” have made it so that there has to be “a digital consideration to all marketing,” Gartner Research VP Jake Sorofman told Marketing Dive. Being able to tie specific revenue outcomes to digital marketing initiatives is helping “close the loop” for marketers, and has driven marketers to shift where they spend their budgets.

In September, eMarketer reported that digital ad spending worldwide would increase 18% in 2015 and make up nearly 30% of the overall ad market. The growth is having a negative impact on traditional channels such as print and TV.

 

"Advertising investments in traditional media like TV, newspapers and magazines have been negatively affected by increased spending in digital formats, such as online editions for magazines and newspapers, and digital video replacing traditional TV," Shelleen Shum, an eMarketer analyst, said.

In fact, TV and print advertising may soon be surpassed by their digital counterparts. An outlook by ZenithOptimedia anticipates digital media to beat TV in ad spend in just the next two years. Meanwhile, the global print ad market is expected to decline through 2019, according to PricewaterhouseCoopers, with magazines stagnating and newspapers falling fast.

The growth in digital and the stagnation (or even decline) in traditional media underscores an overarching trend that has dominated the last few years: Consumers and marketers are favoring new media.

2016 will be little different. As consumers migrate even further onto online and mobile channels, marketing budgets are expected to do the same.

Digital marketing is essentially “mainstream,” according to Gartner’s Sorofman, and the mindset going into 2016 should be "less about 'digital marketing'" – and more "about marketing in the digital world where digital is the default."

2. Marketers will have to think mobile-first

Today, mobile is already one of the fastest-growing media channels in history – and in 2016, marketers will need to prioritize it if they want to reach consumers on their own terms.

In the past five years alone, mobile has gone from an emerging trend to the new normal. Nearly two-thirds of Americans own smartphones, according to a 2015 Pew Research Center study, and that number seems likely to only rise in the next year.

In fact, mobile was the fastest-growing digital channel in the Interactive Advertising Bureau’s (IAB) mid-year report for 2015, and the medium is expected to continue its upward trajectory in the coming years. ZenithOptimedia projects that mobile advertising spend will even surpass desktop by 2018.

Mobile’s surge has redrawn marketing budgets and strategies, ushered in new ad products and platforms, and caused a fundamental change in the relationship between brands and consumers.

“When something is top of mind you start noticing it,” Margo Georgiadis, Google president for the Americas, said at Ad Week. “Our job as marketers is to be there when brands are most relevant to consumers in those micro-moments when they have a want or a need, [we need] to be the spotlight in the tent.”

In the last 18-24 months in particular, marketers have taken a "much more purposeful approach to mobile," according to Gartner’s Sorofman, and are increasingly looking at how it affects the user experience and adds value to their business.

“We’ve entered a new era of advertising, where mobile is a critical component to successful campaigns,” Sean Galligan, vice president and industry lead for entertainment at Yahoo, told Marketing Dive in October.

The migration to mobile has left marketers pondering how to adapt their campaigns to different ad formats even within mobile, such as in-app ads. According to eMarketer, these ads accounted for 10% of mobile ad dollars last year, representing an 80% year-over-year increase.

 

“Mobile app install ads have become the key to getting in front of the right audiences at the right time, and building an audience,” Galligan said.

In the year ahead, eMarketer says consumer usage and better ad formats will continue to drive ad dollars toward mobile. Mobile will provide marketers a unique environment to gather multi-dimensional consumer data that can be used to better personalize messages.

As the buying process and the marketing funnel continue to evolve, brands that leverage this data to improve their mobile marketing efforts should reap the rewards.

3. Social media is becoming a mainstream marketing channel

In 2016, social media companies from Facebook to Snapchat are looking to bulk up their innovative ad offerings and continue growing into major players for ad dollars.

According to the Pew Research Center, 65% of adults used social media in 2015, nearly ten times the number in 2005. Facebook and Instagram alone make up 1 billion and 400 million users, respectively, while the micro-blogging network Twitter has 320 million and Snapchat boasted about 100 million daily active users mid-way through 2015.

Now that the big social companies have built engaged audiences, many are turning their attention towards monetizing them and helping marketers reach their target audiences.

Of all the social networks, Facebook is the most popular for marketers, according to Socially Aware data. The world’s largest social network has worked in recent years to become mobile-first and build out a top-notch ad system. Facebook’s data and targeting tools allow marketers to personalize their social campaigns at scale.

Instagram, which shares parent Facebook’s data and targeting system, has become a favorite among fashion and beauty brands with its visual format. With offerings such as “carousel ads,” the photo-sharing app wants to give brand marketers the space and tools to attract consumers.

Despite coming off of a rocky year in which the company changed CEOs, Twitter is looking to find ways to help marketers leverage the social audience it has built. A handful of updates, including its Moments feature, events targeting, and conversion metrics, positions it as a powerful channel for real-time engagement.

Meanwhile, Snapchat, the go-to messaging app for many younger users, has started to offer marketers ad spots and targeting abilities. The app has set itself apart with its highly-coveted – and highly-engaged – millennial and Gen Z user base.

Marketers are taking note: In the last year, marketing perceptions about social media have changed, with social now seen as a place where marketers can find highly-targeted audiences and track their campaigns with granular metrics.

As social platforms build out their ad offerings – with a particular focus on mobile and video – marketers are shifting their budgets towards social. September data from eMarketer projected that social media ad spend would reach $25.14 billion by the end of 2015, a 40.8% jump from the $17.85 billion spent in 2014. That figure is only expected to climb higher in the coming years, with $41 billion projected by 2017.

An ongoing challenge for marketers persists in the new year: linking social media campaigns to sales. Socially Aware reports that nearly half of all marketing executives have thus far been unable to measure social media spending’s impact on their business. As social companies continue to improve their ad and measurement offerings, expect brands to leverage these audiences in fresh ways.

4. Online video will see its star shine bright

Online video is quickly becoming a vital channel for many marketers.

“It’s simply easier to consume and audiences tend to prefer it for its efficiency,” Gartner’s Sorofman said. “It’s also, generally speaking, more effective as a storytelling medium, creating the inspiration that drives action.”

A recent study by Cisco Systems shows consumer video will account for 80% of all internet traffic by 2019. Consumer viewing habits are moving away from TV and toward streaming video. According to Magna Global, that’s now happening faster-than-expected and is helping stall growth in TV ad spending.

With its projected growth as a channel for viewers, online video advertising should be top of mind for marketers in 2016.

New tech innovations are expected to drive the momentum in that medium. Social companies like Facebook, Twitter and Snapchat are finding ways to integrate powerful video offerings into their ad systems. A few budding areas include auto-play videos, native in-app video ads and live streaming.

“Until this point, we’ve seen video through a relatively one-dimensional lens – something that’s created, recorded, produced,” PM Digital CEO Chris Paradysz told Marketing Dive. In the next year, “we will see the live video, or the streaming experience, become more powerful. People have a much greater desire for community, in the moment, shared experiences.”

From smartphones and tablets to desktop computers, video views are up across devices, making it ever more important for marketers to construct multi-platform video ad strategies.

A November 2015 study by Yahoo found desktop video views grew 34% over the last year, while tablet and mobile video views grew even faster – 48% and 55%, respectively. “Building an ad experience that connects with consumers across devices is key," Andrew Snyder, VP of content strategy and solutions at Yahoo, told Marketing Dive.

 

Decidedly, short ads are winning. Yahoo’s research shows 61% of consumers prefer ads that are 30 seconds or less, and that brevity makes for a quality video ad experience. "It's more effective to front load ads with key messages so they stick with the consumer,” Yahoo said in a statement regarding the findings.

Gartner’s Sorofman said another reason video is attractive is that platforms like YouTube have rolled out shoppable video components that allow marketers to "enable commerce experiences by combining video with shoppable moments to capitalize on moments of inspiration as they occur."

While video is a booming area of online advertising, viewability remains a concern for marketers going into 2016. As video platforms test out ways to solve the challenge -- such as through “sticky” or “floating” videos – the challenge will be to improve viewability rates while serving consumers video ads that speak to their interests.


 
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5. The bleeding edge in digital marketing begins with augmented reality

There has been a lot of chatter around augmented reality (AR) and virtual reality (VR) technologies lately.

Developers are rolling out new technologies, and the talk is turning to how brands and marketers might be able to use them for advertising purposes. While AR and VR – AR’s pricier and more complex older sibling – may not be mainstream marketing channels just yet, they shouldn’t be overlooked.

A Gartner report estimates that by 2018, some 25 million virtual and augmented reality headsets will be sold to consumers. According to Digi-Capital, AR/VR could capture $150 billion in revenue by 2020, with AR accounting for $120 billion of that pie. Digi-Capital attributes a strong swath of AR’s revenues to mobile apps and advertising. Still, according to Gartner's 2015 Hype Cycle for emerging tech, widespread use of AR and VR tech is still a couple years out.

 

But if the lure of VR tech is palpable, the potential scale of AR tech is clear.

Facebook CEO Mark Zuckerberg has said he sees VR tech spreading in a similar way to smartphones, first among the most tech-savvy consumers but eventually becoming ubiquitous. The social network sees the marketing potential of its Oculus Rift goggles, which are set to launch to the public in early 2016, and has begun pitching advertisers on the idea of using the tech.

Union Metrics Editor-in-Chief Jenn Deering Davis also sees the potential, but is more bearish on how soon VR will take off. “[It’s] going to take a little longer and will likely happen in 2017 when the hardware is more affordable and prevalent and more brands can participate,” she said. “But in 2016, we'll start the transition to more VR-ish content.”

In the future, AR technologies could help drum up attention around product launches and experiential events in a more tangible, complete manner. For example, Facebook already has several brands, including Disney and AT&T, advertising with its 360-degree video campaigns, which can be described as a VR “lite” experience for users. These immersive ads help marketers tell richer stories and give consumers new reasons to interact with the ads.

“These [360-degree] videos are easily consumed on regular smartphones and don't require a special VR headset or device, but start to mimic some of the functionality we see in virtual reality spaces,” Deering Davis said. “We'll see more of this kind of transitional VR content in 2016.”

Virtual reality technology could also give B2B marketers a way to showcase large equipment to potential buyers at a lower cost. Think for example a Caterpillar tractor or GE jet engine – telling the “story” of a complex sale is a challenge when the buyer is unable to physically see or test the product. VR offers marketers a way to create a compelling visual story around big ticket items in a 3D environment, and can help create a virtual “try before you buy” experience.

Digital industrial giant GE has already used VR to transport clients on a tour of its oil and gas exploration and to events like the Offshore Technology Conference in Houston.

"Virtual reality is another part of the puzzle for us in terms of opening up the world of GE and doing it through visual storytelling," Katrina Craigwell, director-global content and programming at GE, told Ad Age. "The more we can show rather than tell, the better we do."

Going into 2016, marketers will be smart to keep an eye on AR and VR technologies and see if there are ways to test out their viability for their brands.

6. Brands and publishers are homing in on content marketing

With all the focus on the consumer experience, many brands today are looking to boost their content marketing strategies to build stronger relationships with their potential customers. As a result, content marketing will home in further on providing value to the consumer, as opposed to focusing primarily on the brand’s message.

“Content marketing is how you rise above the noise and it, in my mind, is inherently consumer-centered,” Gartner’s Sorofman said,

It will be crucial for brands to make sure their messages are as native and personalized as possible.

In the year ahead, “we’ll be seeing more and more brands acting like publishers or networks, curating omni-channel content and creating experiences that are meaningful and memorable for the customers they value most,” Deloitte Digital CMO Alicia Hatch told Marketing Dive.

One emerging area for brands looking to create content marketing is through user-generated content (UGC). Through UGC campaigns – in which consumers provide the content – brands can build loyalty among their target audiences while simultaneously figuring out what sort of messaging really resonates with them. By bolstering their campaigns with UGC, brands can tell original stories based in the consumer experience.

"Gone are the days of million-dollar ad investments and one-directional marketing messages," Kim Celestre, senior director of product marketing at Jive Software, told Marketing Dive. "In 2016, user generated content will become more than just a buzzword, with organizations from large enterprises to ‘mom and pop’ small businesses seeking more effective and efficient ways to activate 'brand advocates.'"

Beyond UGC, some see digital video and social media as the biggest game-changers in content marketing.

“If you have good content within your business, social media will allow you to amplify that,” Neil O’Keefe, SVP of CRM and member engagement at the Direct Marketing Association, told Marketing Dive.

What sets social media apart is that it allows you to have a back and forth conversation with your customer, O’Keefe explains, rather than brands just talking at consumers. “If you're doing it [content marketing on social] the right way, you're inviting your consumers to post their own pictures and finished products from what they did with their purchase,” he said.

On the other side of the content marketing coin, publishers are increasingly taking branded content in-house and building out their own custom publishing units. Publishers see an opportunity to directly provide marketers with custom content, as they know their audiences best. The list of publishers taking control of branded content has grown significantly over the last year, and now includes major players such as Vox Media, Quartz, Conde Nast, Fox Sport, The New York Times and Bloomberg Media. These publishers all see the importance of creating an inviting user experience – especially given the prevalence of ad blocking software.

Going into 2016, Gartner’s Sorofman sees marketers becoming more disciplined in their approach towards content marketing, with a particular focus on measurement. He said marketers should also look to leverage paid channels to help boost their content marketing strategies.

“Because earned channels lack the scale and predictability required to move the needle, content marketers will absolutely need to lean on paid techniques, including native, to amplify their efforts,” Sorofman explained.

Looking ahead, O’Keefe said that we are already seeing people hiring content marketing strategists and putting together departments dedicated to this task, which points to how the strategy is booming. What will be key, Sorofman said, is building out a content supply chain and learning to engage audiences on the basis of what interests them.

“Learning how to blend in- and out-house resources, becoming an intelligent broker of marketing resources … and becoming more of a brand storyteller,” according to Sorofman, is what will give brands an edge in their content marketing efforts in the year ahead.

7. Data is essential to marketing

Data today has become essential to marketing, but marketers haven’t quite connected the dots between tracking data and then applying it.

“While marketing has excelled at acquiring data, it has struggled to translate data into actionable results,” Deloitte Digital’s Hatch said.

“In 2016, we’ll see more brands delving into the specific business objectives or problems they’re looking to fix,” Hatch predicts. “Instead of drowning in the sea of ‘Big Data’ – much of which will be irrelevant – brands will be looking to find the ‘Little Data’ that matters to their business objectives and problems, and develop a plan or solution based on those findings.”

The issue of how to filter for “Little Data” remains for many marketers. As such, data management and analysis is becoming a core part of a modern marketer's job.

Shopify CMO Craig Miller told Marketing Dive last summer that quantitative skills and inventive strategies make up the essence of the next generation of marketers. The importance of data has even led to the rise of new corporate roles, such as the Chief Marketing Technology Officer.

But despite the emphasis on data and growing support from the C-suite, the often-overwhelming amount of data coming in is causing marketers to enlist third parties to help with data management and analytics. Nearly three-fourths of marketers plan to seek outside help to deal with their data needs, according to research from the CMO Council and Ebiquity.

The challenge is to sift through the data for meaningful signals that marketers can use.

“While marketers have access to data like never before, much of the data is not available to them in a timely manner so it is very difficult for them to make data-driven decisions that truly have an impact on campaigns while they are being executed,” Opher Kahane, CEO of Origami Logic, told Marketing Dive in October.

Kahane said the solution lies in measurement. Standardizing measurement in a holistic and automated manner in the near term will make it possible for brands to make data-driven marketing decisions in real-time.

Real-time data management is the future of personalization, according to Cxense General Manager Tom Wilde. He told Marketing Dive the key to successful personalized campaigns is content delivery that feels seamless to the user. In order to achieve this, marketers need to leverage the most meaningful data specific to their audience. Filtering out meaningful signals may be a big task, but the end goal is clear: using the most pertinent data to better tailor marketing efforts to target audiences

While data is increasingly important, it’s important to remember it’s not a silver bullet. It will, however, give marketers more information to make better decisions.

“Data won't lead us solely to the promised land,” Starcom USA CEO Lisa Donahue said during Ad Week 2015. “It inspires creativity and creativity kicks up data.”

In 2016, marketers will focus on smarter measurement and obtaining meaningful insights that will inform how marketers can better engage their target audiences.

8. Marketers look to boost personalization

Given the focus on customer experience and the potential for leveraging data, marketers should place a greater focus on personalized communications in 2016.

With the help of data, marketers who put highly-personalized campaigns in motion will be able to drive better results. The benefits of personalization include higher response and conversion rates, brand loyalty and repeat customers, amplified reach and increased relevance with today’s shoppers. According to a CMO Council survey from last year, 43% of marketers said personalization led to more conversions.

Consumers that are given a reason to share their personal information are often willing to do so, but they expect to see tangible benefits, such as tailored promotions, in return. Marketers have to collect data in a way that sheds light on "what consumers are actually in the market for,” Persio CEO Marc Grabowski told Marketing Dive.

The challenge is that marketers’ perceptions of their personalization strategies don’t match the reality. Despite marketers’ best efforts to personalize their messaging, they often seem to fall short with consumers.

Research from Forrester and SAP Hybris found that 66% of marketers said their personalization efforts were "very good" or "excellent," and 48% said they were actively leveraging behavior-based data. However, a scant 16% said they were capturing data on customer intent and using it in real-time marketing efforts. Meanwhile, consumers don’t see the messages they receive as particularly relevant – 40% reported that most promotions they get don’t interest them.

What's missing is a more intimate understanding of the customer's current needs, which comes from smarter measurements of existing data. With this information, marketers can better personalize their messages to customers and provide them with a better experience. Through personalization, brands have the opportunity to build brand loyalty and boost engagement.

9. The struggle with ad blocking is real

The ad blocking debacle grew to new heights in 2015, with the ad industry looking to solve the problem before it gets out of hand in 2016.

"Consumers have turned to ad blocking as a way to voice their concern and return to their preferred user experience,” Ben Barokas, founder and CEO of publishing solutions company Sourcepoint, told Marketing Dive.

The problem has been in the spotlight in the last year especially, with executives at the Interactive Advertising Bureau and the World Federation of Advertisers warning advertisers to put the user experience first before the issue grows further out of their control.

"As technologists tasked with delivering content and services to users, we lost track of the user experience," Scott Cunningham, senior VP of technology and ad operations at the IAB, said in a statement. “We messed up. Looking back now, our scraping of dimes may have cost us dollars in consumer loyalty."

Ironically, the more press that ad blocking technology receives, the more users it amasses. One of the most popular ad blockers, AdBlock Plus, had its U.S. user base grow 44% between April and October this year, reaching more than 13 million users. In 2015, ad blocking also made its way into mobile devices thanks largely to Apple’s iOS 9 update that included ad blocking capabilities. Experts warn ad blocking is now making its way onto video. PageFair and Adobe project ad blocking technologies will cost the ad industry more than $41 billion in 2016 – meaning, marketers are far from off the hook.

 
 

To find the middle ground between serving ads and keeping consumers happy, advertisers need to pursue transparency and focus on truly improving the ad experience.

The solution to ad blocking will come from of “those that co-create content with suppliers or partners, or those who are much more wired into customer feedback at a granular level,” Robert Wollan, global managing director for Accenture Strategy, told Marketing Dive.

Sourcepoint’s Barokas said it will take a re-focusing on the quality of creatives and an open dialogue between media partners about how to engage users that have installed the technology.

With an eye on repairing the consumer-advertiser relationship, which needs to take priority in the year ahead, "a balance needs to be struck between sustainability and providing relevant and helpful advertising to the consumer," DMA's O'Keefe said. "The consumer may need to be willing to have ads appear in their feeds without ad blockers, but the onus is on publishers and marketers [to fix this].”

10. Smart marketers will focus on the consumer experience

The old adage goes, "the consumer is always right." And with the rise of ad blocking, it is clear that there is still a disconnect between marketers and their audiences. The wide availability of information and resources in 2016 makes it even harder for marketers to reach target audiences and easier for consumers to move onto the next best option.

“Customer experience is that last durable way to build loyalty and advocacy with consumers,” Gartner’s Sorofman said. The perspective should be exclusively “how you serve customer needs, but only as they translate value to the business,” meaning there needs to be a value-add on both ends of the transaction.

The marketing view should be from the “outside in,” rather than “inside out,” Sorofman explained, so that marketers are putting their customers’ needs first.

Marketers should think about what consumers need and what they want to hear. This will position brands to better connect with consumers in the moments that matter most, he added. The customer experience should be looked at as “an opportunity to add convenience and reduce friction, while innovating your business model.”

Taking the long-term view of the customer relationship could help marketers avert challenges like disengagement with ads.

"Instead of blasting out their marketing messages on increasingly noisy channels, [brands] need to be where their buyers are: in peer recommendations and on mobile,” Mark Organ, founder and CEO of Influitive, told Marketing Dive about consumer-oriented marketing. “Most marketers today would say they're ‘customer-centric,’ but they haven't even scratched the surface when it comes to tapping into these two channels."

According to Autopilot CMO Guy Marion, 2015 will go down as the year that consumers revolted against interruptive generic marketing. To adapt in 2016, he told Marketing Dive brands will need to do more “one-to-one” marketing. “Doing so requires taking ownership for the customer journey and automating the sum of the buyer's experiences and personal engagements,” he said.

In the year ahead, marketers will have to get creative to do so.

Anna McCarthy, vp of client development at ChoiceStream, said 2016 will need to be the year of “truly meaningful creative” if brands want to reach their consumers in a way that resonates. Campaigns will need to be designed with a specific target individual and device in mind, and ads will have to contain tailored messages. McCarthy predicts that as technology evolves, hyper-local targeting will also be necessary for activating specific audiences.

“It’s time to say goodbye to one-size-fits-all creative,” she said.


Top Image Credit: Pixabay

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