Marketers should use the “reckoning for Big Tech” that this year will bring to “reset their relationships” with advertising powerhouses such as Alphabet’s Google and Facebook owner Meta, an event hosted by the Marketing Society of Ireland will hear on Thursday.
Aditya Kishore, insight director at marketing research centre Warc, will tell an audience of industry professionals in Dublin that marketers should seek greater transparency and negotiate more favourable deals from online advertising giants, as well as considering alternatives when deciding how to invest their marketing budgets.
“Suddenly it seems that these Big Tech companies that have literally defied gravity, going from success to success, are for the first time facing some real challenges,” Mr Kishore said. “Marketers can reset their relationships with these companies, because they’re not in the same powerful position they used to be.”
Globally, the online advertising “duopoly” has been under pressure, with Amazon steadily growing market share and ByteDance’s TikTok capturing the interest of brands.
A Warc survey of more than 1,700 marketers around the world found that three-quarters plan to increase their investment in TikTok advertising in 2023.
However, for the first time in six years, there is negative investment sentiment towards Facebook, with 30 per cent of respondents planning to decrease their investment and only 23 per cent intending to increase it.
Economic woes are also having an impact on major advertising platforms. In 2022, Amazon posted two loss-making quarters in the first half, while Meta recorded two consecutive quarters of revenue decline later in the year, with the Facebook owner’s profits also sliding as it “bet the house” on the metaverse.
Mr Kishore said he was wary of the word “metaverse”, as the precise applications of it remain unclear, though he added that the gaming industry has come the closest so far to offering advertisers opportunities in this space.
In the meantime, Alphabet, Meta and Amazon have announced thousands of lay-offs in recent months, amid over-expansion across the tech sector. This “reckoning” is one of the main anticipated themes of 2023 identified by London-based Warc in its Global Trends report, which explores how macroeconomic trends will affect marketers.
“Bubble up” culture, another of the trends highlighted for 2023, means marketers may have to work harder to reach often disparate audiences in an increasingly decentralised media ecosystem, Mr Kishore said.
The phrase “bubble up” refers to the shaping of culture by communities, “tribes” and fandoms away from the traditional notion of a top-down “mainstream”. The phenomenon means marketers must be aware that “the same message doesn’t land the same way with different groups” and take care when crafting it.
“I think most marketers are concerned about this – they see it as a challenge. Relatively few would say they’ve nailed it, that they’ve cracked the code.”