Trends for Programmatic Advertising in 2021

The world changed pretty dramatically in 2020, and the pace of change isn’t slowing down – even as we stroll tentatively into 2021. With media consumption on the rise, what will programmatic advertising look like this year? How will the change in our behaviour impact engagement with digital ads, ad formats, and other aspects of programmatic? How will social fare as a channel? And with massive growth ahead for CTV & OTT, and what will the impact be for advertising? Our experts answer these burning questions and more as they predict the trends in year two of our “new normal.”

New Targeting Tools

As the cookie fades into digital advertising history, advertisers will have to find new ways to target their audiences and keep messages relevant. There are a lot of theories about what the winning targeting method will be, but let’s face it: no one really knows. Many advertisers (including you!) will try many things. 

The focus of many veterans is first-party data, that is, your own customer database. Brands will lean on the customers they know to come back and buy more. But they’ll also look to partner with publishers and ad networks that have first-party data of their own in large numbers so they can keep hitting their targets at scale. 

Other experts are citing mobile identifiers and hashed emails as possible replacements for the cookie, but one wonders: in a world of new privacy regulations and enlightened consumers, how much permission will we have in the years ahead? For this reason, still others are predicting the return of contextual targeting.

Only time will tell, but one thing is for certain: there will be a lot of change in the way we target our messages in 2021, so read on for programmatic advertising trends.

Pro tip: If you want to build up your own first-party database, use your calls to action wisely! Focus on collecting email and other information from your ads and landing pages.

Formats and Placements that Match Pandemic Trends

With more users streaming and gaming than ever before, it follows that video, in-app, and in-game advertising will be trends this year. In-game ads saw tremendous growth this past year, and that’s expected to continue with in-app video and interstitials leading the way. In-game ads may sound like a bad idea (who wants ads in their mobile games?), but if advertisers follow best practices, there’s no negative impact whatsoever. In fact, 93 percent of players “felt no negative impact of in-play ads”, and more than a third of actually “loved having them in the game.” So, done well, they can be not only effective, but positive. (More on these ad formats later!)

Similarly, Free Ad-Supported Streaming TV (FAST) offers a tremendous opportunity for programmatic advertisers. Services like Roku, Peacock TV, and other OTT services deliver advertising opportunities that paid services like Netflix and Apple TV do not. Marketers can purchase addressable digital inventory and place video ads in a broadcast-like environment. 

With streaming on the rise since the beginning of the coronavirus pandemic, OTT presents a bigger opportunity than most marketers realize. In fact, there are more people who subscribe to at least one streaming video service (68 percent) than traditional paid TV services (65 percent) today. Perhaps that’s why marketers who buy digital video are planning to shift 21 percent of their linear TV buys to CTV. The advantage isn’t only in the targeting, it’s in the medium itself. Video, especially on a larger screen, is immersive and engaging. When you combine that with spot-on targeting, the result can be incredibly effective and impactful.

AI Will Play a Bigger Role

If you’ve run a Google dynamic search campaign lately, you know how amazing AI can be. For targeting and optimizing, it can save a lot of time and often do the job better than a human can. We’ve been relying on it for a while to optimize bid strategies, as well. In 2021, The Drum predicts we’ll see more artificial intelligence automating ad purchases. This will not only help marketers manage campaigns across multiple channels, but it will also support advertising on new channels, including voice agents like Alexa and Siri. 

With the aforementioned demise of the cookie and new privacy regulations coming into play, AI may be an indispensable tool when it comes to targeting ads. Says expert Sherry Bachstein, “Tapping into AI's ability to offer predictive analysis on consumer behavior, while simultaneously leveraging data responsibly, we feel it's the right solution going forward.”

This is a trend that the Beeswax team is definitely ahead of the curve on: last year, Beeswax acquired MediaGamma to expand our AI capabilities and help marketers more effectively meet their goals. 

New Ad Formats Take the Stage

Along with new consumption habits and new targeting tools to consider, we also have new formats gaining popularity this year. A few of them are reminiscent of older formats like interstitials, but many of these new formats are a little more user-centric (and less annoying). 

• Outstream video ads are what some of us old timers used to call “native” video ads, but with the added, user-friendly bonus of being sound-free. (Anyone who’s worked in an office will appreciate that benefit.)  Here’s how Google defines them today: 

A video ad served outside of a video player, often between paragraphs of text, typically without sound. Interstitials, Native, and In-Feed are types of outstream video. The autoplay silent video on Facebook is a good example of outstream.

• Rewarded video ads are also gaining popularity as game and app usage spikes. If you’ve ever played a game online you’ve seen these: they’re the short, full-screen video ads you watch to gain extra spins, or jewel, or lives in whatever game you’re playing on your phone or tablet. The average gamer will definitely engage with an ad in exchange for more play time.
• Bumper ads are also making gains this year. These unskippable pre-rolls may not be new and exciting, but they offer a great opportunity to present a short message to an audience that is quite literally captive. Again, with the huge number of streaming video viewers over the last year, this presents a great opportunity to reach a growing audience at scale with addressable media. 2021 might be a good year to give this format a try. 

Look for other, new high-impact formats to make debuts (and reappearances) over the next year. As more money pours into digital during the pandemic, brands will be looking for new ways to rise to the top. 

Beeswax is here to support your campaigns (and experiments) throughout the year, so don’t hesitate to reach out and learn more about how we can help you conquer the programmatic advertising trends of 2021.

For more on the terms referenced in this article and other programmatic advertising terms, bookmark our programmatic advertising glossary here!