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Massive Growth in Digital Channels Means Digital Adtech Must Evolve

October 5, 2020

Over the past decade, there have been huge shifts in the digital advertising landscape, including the rise of social media advertising, video advertising, and mobile advertising.

According to the Interactive Advertising Bureau (IAB), digital advertising spend was $124.6 billion in 2019, which is about $54 billion more than advertising television spend (the number two medium), with 70% of digital ad spend being served on mobile. Even with the impacts of COVID-19 this year, eMarketer reports that worldwide ad spending is expected to grow compared to the previous year.

Adtech's response to digital ad trends

One of the digital advertising formats that is expected to increase in adoption in 2020 and 2021 is digital audio advertising, which includes digital radio advertising and podcast advertising. eMarketer reported that US digital radio ad spending will reach $3.72 billion in 2020 and US podcast ad spending will grow 10.4% to $782 million in 2020 (expected to surpass $1 billion in 2021). To reflect this change in the digital advertising space, G2 has added a new software category to our Advertiser Campaign Management taxonomy: Digital Audio Advertising Software.

Another category that was recently added to G2 to reflect the evolving advertising space is Digital Ad Intelligence Software. The ‘modern data dilemma’ isn’t new to digital marketers, wherein they have more data than they can analyze. However, it is more important than ever to ensure that ad campaigns are being tracked to eliminate wasted ad spend, optimize ad creatives, and unite marketing initiatives across channels. This information gives businesses insight into their own advertising activities, as well as the activities of competitors, which can provide a significant competitive advantage. Companies can leverage digital ad intelligence software to tame that data and measure the return on investment (ROI) of their digital advertising campaigns.

Digital audio is everywhere, ad spend is automated to keep up

As consumers shift from radio to music streaming environments, marketers will continue to look for ways to incorporate digital audio advertising into their marketing strategies. A major contributing factor driving the growth of digital audio advertising is the emergence and continued adoption of smart speakers and voice assistants. According to ’The Smart Audio Report,’ nearly a quarter of the US population own a smart speaker and 24% of them use this technology daily.

11.8% of consumers will use a smart speaker to make purchases this year, growing to 38 million by 2021.

Source: Smart speaker shopping gains traction (eMarketer)

At the end of 2019 in G2’s ‘Emerging Martech and Adtech Trends in 2020,’ it was predicted that at least 60% of all digital ad spend will be programmatic by the end of 2020 due to advancements in artificial intelligence (particularly machine learning), as well as the rollout of 5G. Programmatic advertising is the automatic process of buying and selling ad inventory in real time through an automated bidding system.

One big move towards programmatic took place in August 2020, when Google announced that it is building out its programmatic audio infrastructure and launched a beta of new offerings in Ad Manager and Google’s Demand Side Platform, Display & Video 360 (DV360), for programmatic audio buyers and sellers. This is the first time Google is providing programmatic sales capabilities for audio publishers in Ad Manager.

The new digital audio advertising category on G2 will include software that enables companies to automate the selling and insertion of ads using algorithmic buying technology into digital audio content, such as podcasts, digital radio, and music streaming services. Programmatic audio advertising content can be streamed over multiple devices, such as desktop, mobile devices, and smart speakers; advertisers and digital marketers can utilize the offerings of this software to reach multiple audio publishers via one buying platform.

Digital Audio Advertising Software ➜

Digital ad intelligence powers more effective marketing spend

Digital advertisers can utilize digital ad intelligence software to invest ad dollars effectively by leveraging market-level spend data across an abundance of media types to make informed ad placement decisions. Additionally, companies use digital ad intelligence software to evaluate the ad creatives their competitors are running, where competitors are advertising, and how much their competitors are spending on their ads. Competitive intelligence is a main component of this type of software, as it can help businesses identify which ad creatives are performing best for their competitors (i.e., types of messaging, CTAs, ad sizes and images, etc.).

Digital ad intelligence software can also track competitors’ key performance indicators, like cost per impression (CPI) and click-through rate (CTR). For advertisers, digital ad intelligence software can help inform strategy, ad execution, and reporting. For publishers, this type of software can assist with prospecting for advertisers and pitching for new business.

Digital advertising software and the adtech landscape continues to evolve due to many factors, including an increase in data privacy regulations like the CCPA and the continued growth of programmatic advertising and supply path optimization. G2’s taxonomy has the ability to remain flexible and reflect the evolving market changes in the adtech ecosystem.

Digital Ad Intelligence Software ➜

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