Report: The Future of Digital Marketing

From global megatrends to practical effects

About the Future of Digital Marketing report

When predicting what’s to come, the hardest part isn’t saying what will happen but when. It can be compared to the stock markets, where we know that an economic downturn will happen but don’t know when.

In this report, we move from megatrends to long-term developments in the field of digital marketing. We look mainly at the European market while maintaining a global lens.

We won’t predict what will exactly happen this year as that depends on a company’s market, industry, and other variables. That’s the work we do individually with our clients.

I wish to emphasize that we’re not looking into a crystal ball and hoping for the best or what we would prefer to happen. We’re looking into the horizon and attempting to zoom in with our binoculars to find out what’s to come and when we, as marketers and business leaders, will reach these points.

You can read this at any point of the year as we update the material (see below for the log); thus, the information is always timely and accurate.

Have a great future!

Digital marketing megatrends

Digital marketing megatrends are wider and longer-term than simply a new technological solution in a given year. Developments such as the popularity of ChatGPT are part of a more expansive wave of the development and intertwining of certain megatrends. They also consist of more than what you would think at first glance. The idea is to find those that affect the field rather than simply those that are strictly within the definition of the field.

Here are the megatrends that we are able to see through the years before and to come.

Private Internet

Private internet is the best way to describe the direction the internet is heading in the eyes of its stakeholders (consumers, advocacy groups, advertisers, tech platforms, etc.) when it comes to digital marketing.

Consumers’ worry about data collection and abuse of that data is at an all-time high. Regulation such as GDPR was just a kick-off on the regulation side, and now the enforcement of such regulations is getting ever stricter. Privacy advocacy groups are putting pressure on legislators. Under these regulatory and consumer demands, different platforms in the ecosystem (browsers, operating systems, ad tech, etc.) have started moving towards a more privacy-focused direction.

This has created a situation where all of the vital parts of the internet ecosystem have taken the privacy standpoint as their next goal to achieve, whether they actually benefit from it or are just bending under pressure.

The next level of e-commerce

E-commerce has been a megatrend for years now. During the past years, it has become clear that it has been at an infancy level. The COVID-19 pandemic has been one of the greatest accelerators in the e-commerce sector.

In addition to moving sales online, the megatrend is now moving toward the next level of e-commerce. It’s bringing e-commerce everywhere and anywhere. This means taking the experience out of simple webshops to massive social media platforms, sales platforms, search engines, and other forms of media enabling consumers and organizations to purchase wherever they are on the internet.

Financial downturn

After the never-before-seen highs during COVID-19 and soon after, the long-awaited financial downturn is on its way to full effect. As a normal function of a working economy, a downturn isn’t a surprise, nor is the approximate timeframe when it happens. The surprise is its depth and length.

For digital marketing, a financial downturn affects all facets: consumers spend less on new things, advertisers shrink their budgets, platforms fire significant portions of their staff, and a general unease comes down on the market.

Machine learning and narrow AI

During the last decade, computing power has reached the level of enabling platforms and marketers to let machine learning solutions take over and support human operations in optimizing, targeting, and content creation. The results of any infant technology growing to maturity are somewhat unstable and unpredictable when left alone.

Machine learning has and will become a more significant and more daily part of marketers’ work while not replacing them. The future will be even more about professionals working with machine learning solutions rather than one or the other.

Vertical integration

The combination of readily available cash in the market, the saturation of occupied markets, and the promise of higher yields by owning more of the value chain have increased the amount of vertical integration, mainly through acquisitions.

This will continue in the future even with the economic downturn and the increased scrutiny by regulators on matter, such as antitrust investigations, on both new and old acquisitions. This will keep making the role of a single company’s or platform’s footprint more significant in the marketer’s eyes.

Web3

Tailing such initiatives as cryptocurrencies and NFTs, Web3 is starting to see practical applications continuously. Crashes and unregulated companies running wild in this space may be grabbing the headlines, but as happened with the internet boom and bust back in the late 90s, functional solutions are moving forward.

Decentralization, scarce virtual assets, and new technologies are the building block of a building of which the final form is still unknown. Web3 has the potential to become “the new internet” but also beholds chances to miss this goal.

From megatrends to near-future effects in digital marketing
Below, you can find the before-mentioned megatrends and how they go together to create the future of the digital marketing ecosystem for stakeholders in the next three years.

From megatrends to near-future effects in digital marketing

Below, you can find the before-mentioned megatrends and how they go together to create the future of the digital marketing ecosystem for stakeholders in the next three years.

Digital ad ecosystem disruptions

The deprecation of 3rd party cookies, limiting mobile ID tracking, increased legislation, and consumers’ rising concerns will generate and create openings for disruptions in the digital ad ecosystem. When the cross-trackability online is deprecated, the power of platforms and the data and targeting solutions they provide will increase. This leads to a more fragmented internet instead of an open one when looked at from the marketer’s point of view.

 

At the same time, this oxidizes the digital ad ecosystem as the giants such as Google might not have the best solutions for the new era. Available capital and the whitespace generated by these megatrends have enabled new ad tech startups to begin their rise, challenging the behemoths in the niche corners of the ecosystem.

At the same time, marketers will be more reliant on new alternative data sets by publishers, platforms, and their own 1st party data. In part, we will also see a return to the old way of buying media placements from individual publishers or groups, though with a more programmatic system, as some create their own platforms and others do this as joint ventures.

Intensified scrutiny by regulators

Digital marketing and technology companies’ entanglement with geopolitics and legislation will keep increasing as the industry’s massive size and footprint have become apparent.

New laws to govern the field will be created in the EU and the US with echoes to other markets. The existing laws will be enforced with more vigor. In the EU, this will be seen as the national DPAs (Data Protection Authorities) cracking down on large tech companies for infringements of GDPR.

 

This increased scrutiny is also driven by activists and groups challenging the lax interpretation of the regulation. Through this, both cross-continental data transfers and behavior-based targeting are in danger in the eyes of GDPR.

Regulators will do more scrutinizing of tech giants on the basis of their abuse of monopoly power and other anti-competitive actions. These will especially happen concerning app stores and acquisitions.

In short, it could be said that regulators have woken up, grown a spine, and acted accordingly.

Algorithmic black boxes become a day-to-day challenge and opportunity

The platforms, especially those with search, social media, and ad technology platforms, will continue increasing the amount of machine learning algorithms they use in their tools. This will create better results for marketers’ campaigns but will, at the same time, keep giving less information to the marketer about why something works and what the audience looks like.

 

In addition to the development of targeting towards ‘set it and forget it,’ the data will also be generated increasingly as a combination of actually gathered data combined with machine-learning-based estimations of performance, as with the more private internet, all of the users can’t be tracked.

AI-assisted creative and content creation is going towards more AI-generated, which brings useful applications but poses challenges around copyright infringement, the correctness of the information, and other matters derived from the fact that the algorithms are only as good as the training data.

In short, you will get better results, and your life will be easier, but you will most likely live with more uncertainty about why, how, and who made things work.

Social commerce will mold itself to fit the times that it’s in

After the start of social commerce beginning to collapse the buyer’s journey to a single platform and being fueled by the COVID-19-assisted acceleration in e-commerce development, the trend will continue and adjust to the environment, as it is still in its infancy.

 

Social commerce efforts by tech companies have been made more reasonable by killing some of their ventures in markets that don’t work. This is a sign of optimization rather than the development reversing. Though social commerce can mainly be seen as something for the business-to-consumer setup, the recent changes in the financial circumstances of many pose the social commerce efforts going more towards consumer-to-consumer transactions with second-hand sales and aftermarket trading of goods.

Moving away from ad-based revenue models

Platforms will continue moving away from ad-based revenue models as we are already seeing them collapse. Vertical integration and the creation of walled gardens enable them to create more value and revenue from advertisers, even if the ad ecosystem as a whole suffers.

 


The tools for the alternative revenue sources are, for example, leveraging the creator economy by working as a middleman, offering subscriptions (such as Twitter Blue), taking a cut from marketplaces, and enabling other monetization models from which to take a cut.

Walled gardens in super-apps

In terms of data, functionality, and ownership of the customer relationship, the megatrends unintentionally drive the platforms towards becoming more like super-apps and walled gardens, which keeps the marketer stuck with said channel or platform. This, on the other hand, I exactly what tech platforms are aiming for.

 

Platforms that have not yet been active in offering ad solutions, but hold valuable data, will increase their role in providing solutions to serve their customers with your offer in a similar vein as Apple Ads and Uber Ads have done. Thus, any platform could become an ad platform if it has users.

Cross-platform measurability will deteriorate, but engagement with concentrated segments and shortening of the buyer’s journey will improve. Later, this will lead to antitrust scrutiny within the EU, US, and China, with other markets to follow.

Exponential ecosystem volatility increase

This is one of the most volatile and exciting times in the history of the digital marketing industry. At the same time, as consumer opinion and regulators are pushing the industry in a more fragmented direction, the development of machine learning solutions aims to support what is lost in terms of data, targeting, and getting a signal from the noise as well as creating exciting opportunities for content creation.

 

The above, combined with the changes in working life fueled by COVID-19 and the later layoffs, have made the development work of even tech giants harder in the fast-paced environment, as seen in the search algorithm volatility, platforms missing deadlines, and leaning too much (or too little) on AI, for example, in moderation of content.

The amount of volatility that has created unsuspected surprises for marketers has increased significantly during the last few years. In the following years, it will grow exponentially.

Recommendations for marketers

As mentioned in the beginning of this report, you will find no yearly predictions here. If you need to better understand your field’s future in comparison to this material, feel free to get in touch.

The recommendations here are based on the analysis above and can be generally applied to every commercial leader’s work concerning digital marketing.

If you’re the kind of person from an organization that wants to be in the right place when the future happens without needing to play catchup, these will be useful for you.

Embrace the Private internet

It may seem like not much concrete is happening regarding the Private internet megatrend, but the necessary pieces are falling in place, and the first movers are already afoot. Embrace the regulatory and technological changes to gain a competitive advantage. Being defensive and trying to delay the inevitable will only cause your organization to fall behind.

Adapt to Social commerce

Though the B2C sector might suffer due to the economic climate, the C2C (consumer-to-consumer) aftermarket will see growth. Your company can be a part of this play, and Web3 applications will be a part of this puzzle as you and your company can benefit from the aftermarket with digital assets combined with your products. Social commerce can be a nice addition or a game-changer. The first-mover advantage is no longer up for grabs, but the first all-in-players are still needed.

Communicate internally about the new age of digital

Communicate about the ‘new age of digital marketing’ with your internal stakeholders. You know that things are about to change, but your colleagues may not. The whole C-suite needs to be aware of the changing landscape, if not for any other reason than to not be surprised when you require more investments and present results differently.

Expect increased volatility and the need to react fast

Prepare to be surprised and to react fast. The ecosystem volatility will keep increasing, and you will need to adapt. How surprising it will be, depends on your preparedness. Be prepared for none of it to work and work from there. The consoling fact is that everyone else is in the same situation. The only thing separating the winners and losers is the ability to prepare and react accordingly – future-proofing.

Slim your marketing tech stack

Slim down your technology stack and aim to centralize based on your future needs. This will minimize future data splintering, which will inevitably happen – you don’t want to be causing parts of it yourself. At the same time, make sure to collect the 1st party data you will need in the cookieless future. Also, you can show measurable cost decreases for your company.

Become data responsible

Become data responsible and let your users or clients know it. Transparency is the key in tomorrow’s data environment. People give their data more easily when they’re informed of its usage, gathering, and its added value to them. Take the role of communicating about this openly, not just in your privacy policy. This, and many other sustainability and CSR efforts, increase a company’s brand value. It is due to a market curiosity that people today are willing to pay more simply for the fact that you’re showing responsibility. Use it.

Invest in, and budget for alternative ad solutions

Start creating your plans for media mixes in the new age of digital marketing. Find out which ad-less solutions from the future will enable success. Decrease investments in 3rd party cookie-reliant solutions and increase testing resources towards future potential technologies. Be among the first, or at least not among the last, to reap the rewards.

Learn and dabble with Web3 applications

Stay in tune with what’s happening with Web3 development. Whether it becomes mainstream or not, you should be aware and make some practical applications with the technologies and practices that are under this umbrella. Think of this as small-scale R&D with no immediate expectations of revenue. Benchmark and then create new novel ideas. Don’t believe the hype one way or another. Test it yourself.

Background of the report and our work

This ever-evolving report doesn’t obey the traditional ways of analysis and reporting, and that’s something that we have consciously done. We want the material to support you in your work rather than being in the exact way in which research should be done and reviewed.

Sources and methods

Our strong record of predicting future development is based on three pillars: multiple data sources, multidisciplinary experience, and the ability to conceptualize the future.

The source count goes up to hundreds, but here’s the short of it:

  • public data and analysis sources such as IAB, Ipsos, Deloitte, Google, etc.
  • proprietary data gathered by Aboad and its partners
  • analysis based on years of industry development tracking
  • weekly scan and analysis of the global ecosystem news
  • utilizing the cross-industry view seen by working with cross-European clients in strategic and operative cooperation

This data is then gathered, analyzed, and produced into what you’ve seen here and more.

Our work helps the marketers and businesses of the future

We work with European growth companies and enterprises to lift their marketing and sales development to the future.

  • Analyzing digital marketing development and its influences
  • Identifying threats and opportunities with Future Radar
  • Constantly observing and scanning technologies, regulations, and geopolitics
  • Offering individual mentoring and advisory for commercial leaders
  • Sparring teams and specialists to guide and drive the development forward

In addition to working alongside our clients with the modern Marketing-as-a-Service model, we’re also offering subscription-based future-proofing services.

Securing the future of our clients’ success has always been one of the cornerstones of our work.

Want to know if we’d be a good match? Get in touch.