The COVID-19 pandemic changed the digital advertising landscape in 2020. It gave marketers the possibility of reaching out to people in their houses. This increases the use of marketing channels like mobile, video content, and voice search.
As the year 2021 unfolds, digital advertising is becoming the most important channel for marketers. Because of this, marketers plan to shift more of their budgets from traditional marketing to digital advertising. Not that digital advertising is easy, but marketers are optimistic that 2021 will be a different year with the latest advertising trends.
In this article, you will learn about online advertising spending trends and the latest advertising trends in 2021.
Online advertising spending trends
Statista revealed that digital advertising spending throughout the world is 325 billion US dollars in 2019. In 2020, the amount was 332.84 billion US dollars, and it is projected to reach 389.29 billion US dollars in 2021 as shown in the chart below.
The biggest market segment is going to be search advertising with a projected market volume of US$171,641m in 2021.
Digital advertising on the desktop will take a dive in 2021, but the mobile will increase to 57% as against 55% in 2020.
Also, according to eMarketer’s Global Digital Ad Spending Update in Q2 2020, the worldwide digital ad spending will bounce back with a growth of 17% in 2021.
Because of the statistics above, marketers are making use of the opportunity to increase their advertising budget in 2021.
A survey of marketers by the Postclick 2021 digital advertising report revealed that marketers are optimistic about the growth of digital advertising. Because of this, 2 in 3 marketers surveyed said that they expect their advertising budget to increase next year.
Below are the latest ad trends for 2021 according to different categories.
1. Display advertising trends
Display advertising is visual advertising that includes banners, images, flash, video, audio, and texts on websites, video channels, apps, and social media. In times past, display advertising is not really effective and most brands struggle to succeed in it. However, in recent times, with different innovations in display advertising, it has become a useful channel for marketers. In the last few years, there have been worthwhile trends that have revolutionized the channel. The first is the fact that dynamic, personalized, and mobile display ads and in-banner video ads will trend more in 2021.
Second, marketers can now target keywords used by consumers in search and also identify the interests of users and use them to target them in ad campaigns.
Remarketing is also an advertising trend that will go a long way in 2021. It is the act of targeting users who have been to your website but did not take specific actions such as click, sign up, or make purchases. With the aid of the cookies (consent driven), you can collect their information such as demographic data, interests, product preferences, and other browsing histories. You can use these data to retarget them with display ads that will entice them to buy. Learn more about remarketing by reading this blog post–Everything you should know about remarketing to make more sales.
In-banner video is another ad trends for 2021. Bannerflow revealed that display ads that have a video embedded in them get an 18.4% higher CTR. This means that customers are now engaging with display ads more than before.
One fundamental Google ads trend in 2021 is that video ads will increase. Already, Google ads have five types of video ads for marketers – they are – Skippable in-stream, bumper, Non-skippable in-stream, Outstream, and Ad sequence. It is expected that marketers will use these video formats more in 2021.
2. Personalized advertising trends
Personalization advertising is creating ad content personalized to each of your target audiences. Do you know that 80% of shoppers buy just to experience the personalized experience?. Also, 44% of consumers become repeat buyers if provided with a great shopping experience. These are the reasons you need to pay attention to personalization in 2021. Consumers are 40% more likely to view personalized items based on information they have shared with a brand.
91% of consumers say they are more likely to shop with brands that provide offers and recommendations that are relevant to them.
An excellent case study of a company that leveraged personalization is Netflix. They are great with viewing recommendations using their algorithm.
They analyze users’ click, watch, search, play, and pause to personalize the content they see on their homepage as they browse the product catalog. Based on the viewer’s past actions, it entices them to the right content they will like.
You can personalize your content, products, emails, and many other things to suit your users. In 2021, you need to create personalized experiences based on your user’s preferences and interests. One way you can do this is by using machine learning to better understand your audience.
3. Programmatic advertising trends
Programmatic advertising is the use of Artificial Intelligence to automatically purchase ads to target the right audience. Below is a chart showing how programmatic advertising works.
As seen above, an advertiser buys an ad space through an ad exchange such as Google Ad Exchange and AdSense. They enter the bid against competitors either through real-time bidding or demand-side provider, then the winning ad is shown to the end-user. The advertiser with the winning ad pays each time the ad is shown.
A good example of programmatic ads is real-time bidding. It is swiftly changing digital advertising platforms. According to Statista, programmatic sold advertising was worth 106 billion U.S dollars in 2019, it was projected to reach 127 billion dollars in 2020 and to grow to 147 billion dollars by the end of 2021.
Besides that, eMarketer also predicts that programmatic advertising will increase by $3.93 billion in mobile spending, a $2.83 billion increase in video spending, and a $4 billion increase in direct transactions.
The advertising trends in programmatic advertising in 2021 show that there will be an increase in over-the-top (OTT) services such as Netflix and Hulu. The connected TV (CTV) will also increase. Therefore eMarketer predicted that CTV ad spending will surpass $10 billion in 2021.
The programmatic ad placement for voice-activated platforms such as podcasts will increase. Digital out-of-home (DOOH) advertising will also be on the rise. This includes billboard ads but 100% digital displayed on screens at airports and in Times Square.
Programmatic advertising thrives on the availability of user data. However, the introduction of GDPR laws in Europe and the California privacy law tends to make it difficult to get users’ data. For example, Google has limited the availability of search term data, that is readily available to advertisers. But not worry, the introduction of programmatic native ads that can’t be blocked by adblockers will help. It helps to drive click-through without violating the data privacy regulations.
4. Mobile-first advertising trends
COVID-19 pandemic has changed the mobile advertising platform. People are spending more time on their smartphones and mobile devices. It increased mobile shopping, video streaming, and gaming among other things. This has made advertisers explore ways to benefit from these changes. According to eMarketer, there is an increase in mobile spending. As of 2020, mobile spending stood at $96.07 but it is projected to reach $117.35 in 2021.
Also, Statista predicted the global advertising spend on mobile channels to be $224163 in 2021.
In 2021, mobile advertising will likely increase. For example, the video app trend will increase.
There will be an increase in mobile commerce (m-commerce). Mobile phones and tablets have created a huge opportunity for m-commerce. Mobile sales are expected to increase by 22.3% to $3.56 trillion in 2021. People want to shop from the comfort of their homes on their phones. For example, the grocery shopping apps alone saw a growth of about 200% from February to mid-march 2020.
Location targeting mobile ads will also be on the increase in 2021. It helps to serve location-focused ads to consumers on the go. Industry forecasts revealed that targeted mobile advertising spends in the United States will be over $32 billion by the end of 2023.
Another trend that will be popular in 2021, is the use of Augmented reality in mobile games. Augmented reality allows you to show virtual objects in a real-world environment with the aid of a smartphone or tablet camera. This technology shows prospects how the product will look like in their environment. For instance, it will show you how cosmetics or hairstyle will look on you when applied.
5. Video advertising trends
Video marketing is one of the most important marketing channels today and will still be in the near future. It is the platform of choice for customers to learn about a new product or service. As of 2020, 78% of people watch videos online each week and 55% say they watch them daily.
Statista revealed that ad spending in the video advertising segment is projected to reach US$37,418m in 2021.
According to a study – customers will spend 100 minutes a day to watch online videos in 2021. This is an increase of 19% daily viewing minutes in 2019, which was 84 minutes. Online video is growing at a faster rate than TV, because people can watch it at their convenience on the mobile, tablet, etc.
These stats make video advertising a viable platform in 2021. Below are the trends that will suffice.
The first video advertising trend is that social will increase video ad formats. This can be seen already on Facebook. On Facebook users watch an average of 8 billion videos daily and videos have a high engagement rate of 13.9%.
User-generated content will be on the rise. According to Econsultancy, users arriving on an e-commerce site via user-generated video content are 184% more likely to purchase.
Below is a chart showing more video trends for 2021 from Oberlo.
6. Social advertising trends
The COVID-19 pandemic has changed the social media platform for good. It has increased the number of users and time spent on various social media networks. This is because everyone wants to stay connected and entertained. In July 2020, the number of users on social media reached 4.57 billion, with 346 million users joining in the 12 months prior. A study released by Data reports revealed that nearly half of respondents have spent more time on social media because of COVID-19. This is why the Ad spending in the social media segment is projected to reach US$110,628, in 2021.
Social media ads are also like normal advertising. In 2021, social commerce will be on the increase. Social commerce is the art of selling items through the social media network. A good example of this is the Facebook shop. It allows businesses to list and sell their products directly on Facebook. There is also the Facebook marketplace where Facebook users can buy and sell used products. eMarketer predicted that there will be a 34.8% rise in retail, which is equal to $31.35 billion in sales.
Apart from Facebook, Instagram also offers shopping features. Pinterest, Tiktok, and Snapchat are also working on their shopping features too.
The use of augmented reality will also increase in 2021. Snapchat has been using it for a while now, but it is expected that other platforms will also use it. Facebook has plans in the offing to release augmented reality wearable glasses in 2021. Instagram and Pinterest have also released virtual try on products so that users will see how it looks on them online.
A good example is from Sephora. Find it below.
The use of videos will also increase. This is because users are 1200% more likely to share a video post than text and image posts.
Lastly, it is expected to see a rise in antitrust and content moderation legislation policies in 2021.
The ad trends for 2021 revealed the shape of digital advertising. As a marketer, you need to pay more attention to programmatic advertising, especially in mobile and video. Invest more in content, products, and email personalization, because customers are more likely to shop with brands that provide offers and recommendations that are relevant and specific to them. Display advertising with remarketing is another ad trends for 2021 that will be more prominent. It offers a great opportunity to retarget your customers and make more sales.
People are spending more time on mobile. It is time to invest more in mobile advertising if you have not been doing it. Video is also gaining more ground. The consumption of videos will increase and this means more opportunity for advertisers.
It is time to get involved in social commerce in 2021. Different social media platforms such as Facebook and Instagram now have shops where you can sell your products.