By Stephen Yusko on October 18th, 2013 | 46826Comment on this postLive+at+%234AsData%3A+8+ad+industry+predictions+from+Goldman+Sachs2013-10-18+14%3A08%3A47Stephen+Yuskohttp%3A%2F%2Fsmartblogs.com%2F%3Fp%3D46826
Debra Schwartz, vice president of equity research on the Internet team at Goldman Sachs, gave a presentation Wednesday at the 4A’s Data Summit in which she outlined eight predictions for the online-ad industry:
1. Ad dollars will continue to shift to online platforms
Schwartz said that online represented 20% of total ad spending in 2012, and she expects that to increase to 30% by 2017.
2. Programmatic buying will take up 70% of online inventory
Schwartz admitted this was an aggressive prediction that was predicated on a loose definition of “programmtic.” But with premium inventory moving into the programmatic realm, auction speed increasing, more brands buying in and an influx of video and mobile inventory into the space, Schwartz said Goldman is confident that programmatic buys will account for a majority of online inventory within a few years.
3. Buying ads across digital and traditional platforms will become frictionless
Ad technology firms such as Mediaocean are allow radio buyers to buy across terrestrial and streaming radio stations and television-ad buyers to purchase traditional TV and YouTube inventory. “The better the tech becomes, the more buyers will embrace it,” Schwartz said.
4. Consolidation will continue
Deals that resemble Facebook’s purchase of Instagram and AOL’s Adap.tv buy will be the norm as companies look to expand their ad capabilities with acquisitions of mobile, data and video companies. The goal will be to create 360-degree marketing solutions.
5. The “technology tax” will shrink
Schwartz predicts a drop in margins for those in the middle between advertisers and publishers, as barriers drop and technology becomes more widely available and easier to use.
6. The visualization of the Web will continue
Image- and video-based communication is becoming easier and more diverse — and also extremely popular. Advertisers will follow consumers onto visual platforms.
7. Companies will continue to leverage first-party data
As the era of the cookie fades, companies such as Google, Facebook, Amazon and LinkedIn will increase their focus on proprietary user-ID solutions that will allow marketers to target and retarget their users across the Web.
8. Ad targeting will become device agnostic
Schwartz said that this trend is still in it’s beginning stages, but that rapid advancements are likely in the next few years. Following a user across their many devices and delivering ads that are tailored to how they use each platform will prove extremely successful.
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