2022 Digital Marketing Year in Review
2022 Digital Marketing Year in Review
The year 2022 will go down in the books experiencing a seismic shift across technology and social media platforms. Nobody expected crypto and NFTs to crash. Meta’s metaverse has been a flop and Elon Musk’s purchase of Twitter and subsequent decisions had a surprising impact on brand reputations, stock prices and ad budgets. Regardless, as the recently combined entity, Deksia/Anvil weathered these and other surprises from Google, TikTok and a host of market players to survive another year of mostly-on-target predictions for digital marketing. We’ve self-graded our “edgy” predictions made a year ago, for your enjoyment and discussion. Enjoy!
The Metaverse will evolve from distraction to (virtual) reality for brands
While many believe Facebook’s rebrand as Meta and focus on the metaverse is a strategic distraction from bad press fueled by the Facebook Papers, we believe at Deksia/Anvil that its horsepower, deep investment in the metaverse, along with additional investment by other major players like Microsoft, will inspire many brands to dabble in the virtual world in 2022. While consumers may be a few years from caring about the metaverse, early adopters will embrace the novelty and utility. We’re hoping that the 2022 iteration of the metaverse is more than just a glorified Second Life.
[Grade: A-. As is often the case, we get excited about emerging technologies and tend to be a bit optimistic about their adoption. Fortunately, in this case, we were correct about the volume and depth of brand activations by larger brands like Gucci, adidas and Nike. In fact, Nike has generated more than $200 million in revenue via 21+ million visitors to its Nikeland metaverse community on Roblox. Despite Meta cutting jobs and investments in their metaverse presence, look for more brands to jump into the fray in 2023.]
Web 3.0 will become ubiquitous
Consumers’ concern over data security and creating a safer online environment to share personal data will be driving forces that fuel the growth of Web 3.0 technology in 2022. The evolution of blockchain technology in particular will provide a safer user experience (UX) for consumers, where they will feel safe sharing first-party data and know exactly how third-party platforms are using personal data. Combined with improved AI functionality, semantic metadata and 3D graphics – Web 3.0 will deliver an improved and better UX for all users. As full data transparency is on the horizon, this will accelerate the transition and put control of data back to where it belongs – the user.
[Grade: C+. Unfortunately, brands and consumers have not embraced Web 3 in the same fashion as elements like NFTs and the metaverse. Both the metaverse and NFTs are still plagued by issues around security, privacy and other complexities that are slowing broader adoption. We may have been a year or two early on this prediction.]
Video marketing will become a vital part of any online marketing strategy
Consumers rely increasingly on the video to make decisions about the products they are buying. Video platforms like YouTube, Facebook, and TikTok feature live streams, unboxing, and testimonial product videos, which are going to gain popularity in 2022. As a result, video optimization and advertising on TikTok and YouTube will be increasingly necessary. Google has also rolled out structured markup features like clip markup which help users find important individual parts of videos, increasing the need and value of optimization for commerce. Using new and emerging markups on a brand’s most popular videos will help to improve user experience and Google’s ability to digest and index the video content.
[Grade: A. While this was a relatively safe prediction, we underestimated the explosive popularity of TikTok as a discovery and learning tool, further fueling the growth of online video use for marketers. Short form video grew significantly across platforms, including YouTube and Instagram as well, paving the way for greater use of vertical and short form video in 2023 and beyond.]
MUM will strengthen Google’s ability to understand more complex searches
Google is always working to get users quicker, more seamless access to information. MUM, or Multitask Unified Model, uses AI to formulate an understanding of the context behind searches and will have a greater influence on search results in 2022 and beyond. Google recently demonstrated how MUM works, showing that search results would attempt to fully answer a search query with text, imagery, maps, and more. With MUM, content strategies will need to provide unprecedented depth, in order to provide searchers with all the information in a single result. The days of providing only topical information on a given webs page in order to gain organic visibility in target searches are numbered.
[Grade: B+. While we didn’t nail this 100 percent, AI apps have been introduced as digital companions and now collect data to offer personalized results for most queries, pulling assets from all of Google’s inventory for a unique and customized user experience. Look for further progress on this front in 2023.]
OTT will gain traction as ad targeting options decrease
Security and privacy demands are creating problematic limitations with third-party cookies and data tracking. Facebook, Apple, and Google Chrome are limiting data collection capabilities. Social media and search engine platforms will become much more generalized, with decreased targeting capabilities. Ad platforms will eliminate audience targeting, limiting advertisers to first-party data collection. These changes will encourage more brands to explore connected TV, podcasts, and platforms like Spotify that have their own internal marketing platform where the user controls what content they want to see. Products like Google’s smart TV and the new Roku TV are allowing viewers to stream content and enjoy gaming, utilizing click-to-buy on-screen ad placements. Smart TVs will be getting smarter with shopping from your own home with enhanced OTT streaming advertising options.
[Grade: C+. Social and search engine platforms definitely took away some targeting options and limited others. However, there wasn’t as much of that as anticipated. OTT certainly stepped up its game and gained some traction, especially on platforms that offer live TV like YouTube and Hulu. More of the OTT platforms are also starting to offer self service models as well as in-platform creation options, making it easier to access and prompting wider usage, while also having more targeting options. ]
More businesses will move to DTC eCommerce
Due to the pandemic, businesses ranging from psychiatrists to car dealerships have begun marketing and selling products and services direct-to-consumers (DTC) on their websites. Companies are tired of losing profit by selling wholesale to distributors and evolving technologies have made eCommerce approachable to even the smallest business. Even larger retail chains are starting to focus more on DTC eCommerce, limiting physical store locations, retail footprints, and headcount. Brands like Nike are limiting distribution of its footwear and apparel so they can sell more direct and other brands will follow suit in 2022. The additional margins gained by DTC eCommerce sales can be reinvested in digital marketing to further increase profitable revenue. We predict brands will sell on select marketplaces (like Amazon, Walmart.com, and Target.com) to augment reach and revenues, but will still rely primarily on DTC.
[Grade: B+. According to Insider Intelligence, DTC Sales will account for one in seven ecommerce dollars in 2022. This number is significant in validating our prediction. However, brick and mortar retail sales are also expected to grow 5-8 percent in 2022 as well, demonstrating consumers still see value in the physical retail experience. Furthermore, many brands have stayed with ecommerce retail channels like Amazon and Target to maintain visibility and sales volume. While DTC ecommerce will never completely replace traditional retail, it is a critical channel for many brands and will only increase in importance in the coming years.]
More companies will offer retail media networks leveraging first-party data
With the impending loss of third-party tracking cookies in 2023, companies and marketers alike will be exploring new opportunities to reach prospective customers. Companies such as Target, Walmart. Recently, Lowe’s launched its own media network, allowing advertisers to utilize its company’s first-party data and reach customers as they shop online. As the pandemic accelerated the adoption of online shopping, we expect retailers will offer additional advertising opportunities on digital storefronts in the coming year.
[Grade: B-. The global eCommerce market is expected to reach $5.5 trillion in 2022, $1.575 billion being based in the US alone. Amazon alone generates 5.69 billion visitors monthly, dwarfing Walmart at 514 million. That translates into a very large marketplace and advertising channel for brands looking for an alternative to 3rd party cookies. The primary reason we predicted significant growth of marketplace advertising was Google’s planned retirement of 3rd party cookies in Google Chrome. For better or worse, that sunset was postponed until the second half of 2024, giving brand advertisers a much longer runway.]
Third-party cookie data will begin to sunset itself
With the anticipation of platforms eliminating third-party cookie data, marketers are forced to produce workarounds. Even though Google has pushed out its third-party data sunset date to the end of 2023, users and businesses have been preparing for the loss of critical targeting data with various workarounds, including the increasing use of first-party data. With Google failing to find a viable solution that meets everyone’s needs thus far, we predict there will be some sort of industry compromise by mid-2022, resulting in third-party data naturally sunsetting by year’s end on most popular platforms.
[Grade: C-. While cookies have started the process of self-sunsetting, the progress was far less than we expected. This is primarily due to the fact Google pushed out their Chrome deprecation another 2 years.
Regardless, first party data is being used more frequently and more usage options are becoming available, no meaningful alternative has been announced or decided upon as of yet. A viable solution isn’t likely until the second half of 2023 at the earliest.]
Influencer marketing will fuel SCommerce
Influencer marketing has gained notoriety within the digital marketing ecosystem as an essential strategy in the past few years. At Anvil, we believe the next evolution for influencers is to become the foundation for successful social media eCommerce (aka sCommerce) in 2022. In addition to important metrics such as engagement rates, influencers will be commonly compensated based on a commission structure related to conversion rates (leads or sales). With a greater focus on performance metrics, influencers will achieve a higher level of credibility with brands. Micro-influencers will rise significantly in popularity due to their accessibility to small businesses and the appeal of being able to target nuanced audiences. Retail eCommerce brands invest in direct shopping formats on popular social platforms, including TikTok.
[Grade: B-. The influencer marketing industry grew 18.8 percent in 2022, and is now valued at $16.4 billion. By next year, influencer marketing expenditure is projected to reach $4.6 billion in the US alone. In 2022, spending is expected to grow to $4.14 billion, compared to 2021's $3.69 billion. Unfortunately, none of this supports our more tactical prediction about how brands are engaging and measuring the impact of their work with influencers. We don’t believe the industry evolved as much as we’d hoped, but there has been progress in terms of making influencer marketing a more integrated and strategic component of the digital marketing mix.]
Multicultural representation in marketing will continue to increase in importance
The digital age, accelerated by COVID-19, has created a world that is more interconnected than ever before. The term “global village” carries increased weight as even extremely remote areas see mobile device use continuing to reach saturation point. The success of international content breaking into the US mainstream has also led to an acceleration in engagement and demand for global representation. South Korea’s Squid Game on Netflix is the latest example, following the Spanish global hit Casa de Papel (Money Heist). With content publishers leading the way, brand advertisers will follow suit, developing new strategies to maximize the relevance of multicultural inclusion within marketing messaging, including messaging from the US’s own backyard.
[Grade: B. While awareness of the need to represent cultures, genders and socioeconomic backgrounds has increased significantly in the past year, investment and behavior has fallen well below our expectations. This will be a slow moving train, partially derailed by political changes in the US and abroad, including the distraction of the midterm elections. Look for more significant progress in the next year or two, as more progressive voices take the helm at brands.]
Check out our 2023 marketing predictions on the SEMpdx blog, and feel free to leave comments below regarding the above predictions, our grades or how your own predictions fared.