Consumers have moved to digital, are brands following?
By Zion Rufus
Backed by technological acceleration, the seismic shift in today’s marketing environment has caused a major disruption in the ways which brands interact with their consumers. Where some brands have fully embraced digital distribution channels, some industries are still lagging.
The use of smartphones has grown rapidly, and the way consumers interact with various brands or sellers have transformed, owing to the accessibility of high-speed internet on smartphones. As well, the steady growth of internet users globally has become an important factor fueling the growth of the online digital advertising market. Over the past decade, Internet proliferation has exploded. With a current worldwide estimated population of 7.8 billion, Broadband Search revealed that approximately 4.93 billion people have access to and use the internet frequently, and looking ahead, there will be about 6 billion Internet users this year (75 percent of the projected world population of 8 billion) according to statistics from Cybersecurity Ventures.
“Much of the marketing budget is already on digital; traditional brands are becoming digital-first. Basically, 50% of media consumption is online, and as a result, 50% of the budget have shifted online. Consumers have moved to digital; brands have been forced to follow,” said Vytautas Paukstys, Co-founder and CEO, Eskimi during the MARKETING EDGE Stakeholders Quarterly virtual summit which held on 31st March, 2022.
With marketers leveraging internet advertising to achieve their marketing goals, the rise of social media bloggers, growing trend of influencer marketing, growing demand for e-commerce and social commerce accelerated by the pandemic, and the continuous increase in penetration of internet across the globe has presented a great opportunity for digital advertising.
Paukstys continued: “Although industries such as e-commerce have shifted their budget to digital, some other brands like FMCGs, banking and so on are not yet fully there. If we look at the global trends and what has happened over the last couple of years, some brands have moved to digital, and the speed has increased a lot. The biggest channels for growth of course are social media, e-commerce, online video, gaming, e-sports etc. 2020, there was a bit of a fall in digital media growth, but in 2021, we saw that the growth reaccelerated, and up to 50% of the global media spend shifted to digital. Going forward, we now expect that in the next couple of years, the digital spend will surpass the other 50%.”
Favorably, 2022 ushered in positive expectations for the ad world as advertising across all digital channels have been projected to exceed 60% of global ad spend for the first time this year, reaching 61.5% of total expenditure according to market reports from Publicis Groupe media agency, Zenith. WPP’s GroupM also predicted an additional 13.5% growth in 2022 as digital now makes up the lion’s share of advertising spending and is expected to account for 64.4% of total advertising this year, up from 60.5% in 2020.
“Another big trend which has been there but emerged in the last couple of years is that gaming audience has started to grow at a much more technographic pace and this is because users have also begun to use their devices outside of working hours; a lot of them are playing games multiple times a day on their mobile devices,” Paukstys shared.
Over the years, advertisers began to incorporate in-game advertising into their media buying strategy to capitalize on the reach that gaming offers. In-game advertising is the practice of using games particularly Web-based games, to promote an organization’s brand, product, or even the launch of a new one.
As a result, marketers are increasingly buying into the in-game medium as the monetization continue to grow rapidly across mobile gaming clients, wider reach of diverse and engaged audience, the growth of e-sports at a phenomenal rate, and the implementation of sophisticated technology solutions, due to changes in online data privacy, the advent of 5G, increased time spent playing games, and the ever-expanding types of audiences that play games globally.
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