Md Consulting

The e-Marketer Summit recently highlighted the key trends shaping the digital marketing landscape and opportunities for 2025.

The discussion included eMarketer analysts Sarah Marzano and Evelyn Mitchell-Wolf. StackAdapt’s CMO Ryan Nelson and CTO Yang Han also participated. They covered a range of topics from regulatory pressures to the evolving role of AI.

Here are the main takeaways:

1. Increased Regulation of Digital Platforms

• Antitrust: Big tech companies, including Google, Meta, Amazon, Apple, and Microsoft, are facing intense antitrust scrutiny globally. By 2025, these giants are projected to more than double their share of US digital advertising since 2008. Multiple active lawsuits from the US government and potential future actions related to AI dominance are anticipated. The upcoming US presidential election could also shift the regulatory landscape.
• Child Safety: Governments worldwide are increasing pressure on both large and small online platforms to protect children. The UK’s Online Safety Act is a regulation already in effect. The EU’s Digital Services Act is soon to be enforced. In the US, potential legislation like KOSA and COPPA 2.0 could significantly impact platforms like YouTube, Snapchat, and TikTok.

2. Shifting Search Landscape

• Product Research Beyond Search Engines: Consumers are increasingly using retail platforms like Amazon and Walmart for product research. They often turn to these platforms first, even before traditional search engines. Social media platforms also play a growing role, especially among younger demographics.
• Retail Media Search Growth: Retail media networks are experiencing rapid growth, primarily driven by search advertising. Retailers innovate search functionalities to serve high-intent shoppers. They also support upper-funnel discovery. This aims to balance monetization with user experience.
• Traditional Search Slowdown: While still significant, traditional search engine ad spending is slowing. Google, the dominant player, faces competition from generative AI-powered search and potential disruptions from antitrust lawsuits. Generative AI search engines like Perplexity and Search GPT could alter consumer search behavior. However, Google’s default engine status provides some protection.

3. The Long Tail of Retail Media Networks

• Crowded Market: The retail media network landscape is becoming increasingly crowded. Ad spend share beyond the top two players, Amazon and Walmart, remains relatively small. It is around 16%.
• Advertiser Challenges: Advertisers face challenges due to a lack of standardization across different retail media networks. This includes difficulties in executing buys, comparing campaign performance due to disparate metrics and transparency issues.
• Standardization Efforts: Industry bodies like the IAB and MRC are developing measurement guidelines to address standardization challenges. Adoption, particularly among smaller retail media networks, is expected to be crucial for proving value to advertisers.
• In-Store Retail Media Potential: Despite significant in-store sales, in-store retail media ad spend remains small. High capital expenditure for hardware, cross-media measurement complexities, and the potential shift of existing trade budgets are slowing momentum. However, formats like in-store audio, digital screens targeting non-endemic advertisers, and smart cart solutions are expected to see continued investment.

4. Streaming Platform Strategies

• Churn Concerns: Streaming platforms are facing potential churn as content production decreases due to factors like strikes and cost-cutting. Consumers are also showing a preference for fewer subscriptions and simpler billing.
• Ad-Supported Tiers: Platforms are increasingly adopting ad-supported tiers. They aim to boost revenue and offer lower-cost options to consumers. This strategy seeks to mitigate churn.
• Bundling: Bundling strategies are becoming more common, with companies like Amazon and Walmart offering bundled streaming services with memberships. However, consumer awareness and actual platform engagement remain considerations.
• Unscripted Content: Platforms are exploring unscripted content production. It serves as a cost-effective alternative to scripted shows. However, consumer appetite for this format compared to social media content is uncertain.

5. Social Video and Creator Economy

• Social Video Growth: Social network and YouTube users are projected to surpass linear TV viewers. Time spent on social platforms is increasing. Meanwhile, linear TV time declines. This shift is expected to drive ad spend towards social video.
• Creator Influence: Creators are key drivers of content consumption on social platforms. They are increasingly producing episodic content. This encourages binge-watching and increased engagement.
• Commerce Opportunities: Creators are powerful purchase influencers, outperforming brands and retailers in driving social commerce. Advertisers are urged to diversify video strategies. They should partner with creators. Leveraging creator partnerships for commerce is important, especially within retail media networks.

6. The Role of AI

• Efficiency and Automation: AI, particularly generative AI, is already improving efficiencies in digital marketing. It enhances creativity, enables AB testing, generates insights, and automates manual tasks.
• Predictive and Generative AI Integration: The next major breakthrough is expected to be the integration of predictive and generative AI. This could lead to AI-powered tools that automate ad targeting. They could also optimize campaigns end-to-end and learn with human guidance. This bridges the gap between predictive AI’s analytical power and generative AI’s contextual understanding.

In Conclusion:

2025 is poised to be a transformative year for digital marketing. Marketers must navigate regulatory changes. They should also adapt to evolving search behaviors. Additionally, capitalizing on retail media and social video trends is important. Marketers need to leverage the power of AI to succeed in this dynamic landscape. The industry must focus on standardization, consumer experience, and innovative strategies to unlock the full potential of these emerging trends.

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