Last week we released a comprehensive article that showcased important insights from 2016 that can help marketers and brands alike with planning and strategy development as we enter 2017. Notorious as the era of automation, 2016 stimulated advances in artificial intelligence — which will only transcend further into 2017. In 2016, the industry was also aroused by the saturation of chat bots, live video content and for the first time, YouTube ads earned better return on investment (ROI) than TV! Ad blocking, augmented reality (i.e. Pokémon Go) and the Internet of Things (Iot) were also appetizing technology talking points that deserve honorable mentions for their impact in 2016.
With our 2017 predictions and insights already disclosed, let’s analyze the trends and innovations that survived and croaked in 2016.
The Biggest Digital Marketing Changes in 2016:
Snapchat was busy innovating new technologies that benefited both the user and the advertiser. The original ephemeral platform extended an invitation to users to purchase customized geofilters, and also introduced sponsored geofilters for advertisers and brands – both which contributed to the $366.69 million in ad revenue. The app honed in on the intimate conversation it had with younger millennials and its range of ad units with improved targeting, and we can expect Snapchat’s ad revenue to double in 2017.
In addition, Snapchat rolled out Sponsored Stories that were woven in between users’ stories, capable of linking out to longer videos, other content or directly to an app installation. Snapchat’s last innovation of 2016, Spectacles, was the first wearable pair of ‘smart glasses’ that record the world from your perspective. Makeup brand, L’Oréal Paris, leveraged Spectacles at the January 2017 Golden Globes, streaming live backstage content through the perspective of Spectacles.
- Facebook video-roll
In 2015, Twitter released its live-streaming video app, Periscope. Facebook, which has 50 minutes of user’s time each day, introduced its own version of real-time video streaming, attracting 3x more attention to live video content than to pre-recorded video would. In 2016, Facebook served more than eight billion video views per day, doubling the video content consumption in 2015. A recent study conducted by Cisco concluded that this trend will dominate the internet, constituting 80% of all global internet traffic by 2019. Aligning with the quadrennial presidential election, Facebook leveraged opportunities to live stream both the Republican and Democratic national conventions in addition to the three presidential debates via a partnership with ABC.
By stealing share from YouTube, Facebook is asserting itself in an advantageous position with publishers who would inevitably bring in higher quality content and executions. Earlier this week, Facebook announced that it would be testing a ‘mid-roll’ ad on its video platform, with the objective to generate revenue for media companies and the social conglomerate.
- Instagram introduces ephemeral marketing
Although similar to Snapchat Stories (the first iteration was launched in 2013), Instagram introduced a simplified version in August 2016 that catered to Instagram’s older skewed audience. In tune with Instagram’s finesse, their version of ‘Stories’ provides the similar overlay text/graphical features that Snapchat offers, but the big difference is that Instagram Stories are discreetly configured at the top of Instagram newsfeed, out of the way from users who don’t want to watch them. Snapchat’s interface remains much more complex, capable of face-mapping technology, but Instagram was successful in tapping into the niche, opportune ephemeral market.
- Over-the-top (OTT) devices
Streaming video is predominately dominated by YouTube, Netflix, Amazon and Hulu, serving 188.1 million video users, with a projected growth of 3% to 193.8 million in 2017. In 2016, YouTube and their original content rental counterpart YouTube Red, accounted for 95.3% of OTT video viewers, Netflix brought in 60%, Amazon received 36% and finally Hulu aggregated 31.4% of video users.
Other competitors vying for the opportunity to penetrate the big four, such as Verizon’s Go90, have failed to muster even a dent among consumers. TV networks have even taken a page from direct video providers (such as Netflix) and found value in broadcasting direct to consumers through streaming services, like HBO Now or CBS All-Access.
- Emergence of buying ad inventory programmatically versus direct buy
The emergence of programmatic transactions has facilitated media buys with ease, versus the standard direct buy that requires a sales team to broker the deals between advertisers and publishers.
News about Rocket Fuel, a programmatic marketing platform that offers both a DMP and DSP, has saturated the programmatic space, illuminating their inability to adapt with the ever-evolving space. Earlier in 2016 Rocket Fuel asserted that the company wanted to become more transparent with pricing and performance, but stock prices dropped 40% from $3.36 at the beginning of the fiscal year to $2.03 at the end of 2016.
- Demise of native advertising’s performance, but rise of mobile native ads
Four years ago, native ads offered a new opportunity for digital and mobile marketers to capitalize from, but is there such a thing as too native? At the bottom of major publishers’ articles are links to other content pieces that appear to be harmless and reliable. In reality, these are just low quality ads that are significantly contributing to the demise of native advertising’s performance and credibility.
Despite native advertising’s poor performance on desktop, Business Insider claims that native ads are poised to dominate the mobile space. Mobile native ads initiate better engagement levels than mobile display ads, and metrics for mobile native ads (such as clicks or shares) convey that they perform 20-60% better than mobile display. Programmatic networks and exchanges automate the buying and selling of native ads, increasing scale and offering a customized native ad to each relevant property.
- AdWords introduces new updates
In 2016, Google AdWords rolled out several important updates, including mobile and tablet bid adjustments, universal campaigns for app promotion, Google merchant applications, TrueView video call-to-actions (CTAs) and mobile price extensions just to name a few. Perhaps the biggest updates to hit the paid search market was the introduction of expanded text ads (ETA) and the forfeit of right rail ads.
- Expanded text ads (ETA)
- Google outlined the new parameters for text ads on their support blog, granting advertisers two headline fields up to 30 characters each, a description field up to 80 characters, a display URL that uses the final URL’s domain and lastly, two optional ‘path’ fields that can be used in the ad’s display URL with up to 15 characters each.
- AdWords said goodbye to right rail ads
- In January 2016, WordStream conducted a study that pulled data from 2000 WordStream customer accounts across all industries. Based on a sample pool that represented tens of millions of clicks within the United States, WordStream derived that the right rail of the SERPs only received 14.6% of clicks in comparison to the 85.4% of clicks from top-of-the-page ads. The SERPs now reflects four ads above organic searches, and three ads below organic searches.
Social platforms such as Facebook and Google released highly targeted audience features capable of connecting publishers and advertisers with niche audiences that have a higher propensity to engage or convert.
- Google began to use a website’s mobile-friendliness as a ranking factor in 2015, and in May 2016, enforced the need for website’s to be optimized for mobile.
…And the biggest and WORST Digital Marketing Changes in 2016:
- The demise of social video platform, Vine
Vine served as a conduit for aspiring adolescent and teen talent to be discovered by record labels and other talent agencies, uncovering now-celebrities including Shawn Mendes, Nash Grier and Logan Paul. In October 2012, Twitter acquired Vine, but has been existentially questioned for not investing enough resources to innovating the platform, which ultimately stagnated user signups and engagement.
- Facebook slammed with fake news
Upon Donald Trump’s startling election as the 45th president of the United States, Facebook was criticized for influencing the electorate by inundating Facebook newsfeeds with hyper-partisan sites and false articles. A vice president of Facebook’s newsfeed, Adam Mozzeri, fired back with concerted effort claiming that the misinformation represented on Facebook’s newsfeed only accounted for “one fraction of a percent of the content across the network.”
- Increased policing of influencer marketing
The Federal Trade Commission (FTC) cracked down on social media influencer marketing, tightening the reigns on social media celebrities who peddle their newsfeeds with brand messages. In order to combat deceptive celebrity endorsements, influencers are now required to denote a paid ad with a hashtag that explicitly identifies it as an #ad, #sp, or #sponsored.
As native advertising began rising in popularity in 2015, more brands were reaching out to influencers for branded messages, including Lord & Taylor. Much to Lord & Taylor’s chagrin, the department store was served with a violation for deception after hiring 50 online fashion influencers to promote their new clothing collection without requiring each celebrity to disclose their affiliation with the department store. The campaign resulted in 328,000 engagements with Lord & Taylor’s Instagram, influencing the FTC to enforce transparency between the relationship of celebrities and the brands that hire them.