Digital Advertising Industry News


Behavior and Lifestyle Changes Drive Advertisers To Prioritize First-Party Data And Diversity

January 15, 2021 Sarah Cavill

As 2020 drew to a close, IAB released their 2021 Marketplace Outlook, an impact study that examined the plans, concerns and focus of media buyers heading into the new year. The study found that trends from 2020 are impacting how buyers plan for the new year, including reliance on first-party data, the growth of streaming and ecommerce and the need to prioritize diversity. 

Digital Ad Budgets Are Expected To Be Robust, But Flexible, In 2021

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After a year of being judicious, ad budgets are predicted to be higher in 2021, with digital media expected to represent 71% of total budgets. Overall, ad budgets are up 6%, with digital spend up 14%. Buyers are still cautious and staying flexible, with 39% saying their 2021 budgets are just “ballpark estimates.” Additionally, IAB notes that “nearly two-thirds of media buyers are evaluating plans more frequently than they have in years past,” which means more media planning checkpoints and optimizations throughout the year. 

Capturing First-Party Data Is A Major Priority For Buyers Looking Ahead

According to the IAB 2021 Marketplace Outlook, “41% of media buyers do not know if their stakeholders have a clear understanding of the implications they will face once cookies and identifiers are terminated/blocked.” The need for quality first-party data will be the story for advertisers this year. As certain kinds of third-party identifiers are sunsetted, and consumers demand more accountability with their data and more personalized connections, advertisers need to be prepared. The IAB found that buyers are mixed in their understanding of how the loss of cookies might impact them, and many advertisers are partnering with external and internal partners in order to deal with privacy and data changes. 

The good news is that prioritizing first-party data gives digital advertisers better opportunities to accurately segment and target audiences, avoid privacy issues and give consumers more of what they want. Leveraging first-party data to target and engage users effectively is the best way brands can prepare for an increasingly cookieless future.

The Behavior And Lifestyle Shifts From 2020 Mean More Performance Advertising In 2021

As advertisers set goals and strategies for 2021, the unique experiences of 2020 are going to be reflected in where their ad buys and marketing strategies lie. For example, 50% of respondents in the IAB 2021 Marketplace Outlook said they would be “Increasing ad tactics to better promote ecommerce shopping options [and] drive ecom sales in 2021 as a result of continuing societal, health and market challenges.” Ecommerce exploded in 2020, and many industries pivoted to create ecommerce hubs and seamless direct-to-consumer (DTC) shopping experiences for consumers. It’s likely that ecommerce will continue to boom in 2021, with optimized advertising strategies that drive users to buy online.

Additionally, the pandemic shifted many buyers from mission- and caused-based marketing in early 2020 to performance-based marketing at the end of 2020. 64% of those surveyed said performance marketing will be a focus in 2021. The reliability and accountability of performance marketing makes it a thoughtful choice, especially for marketers that must prove the efficacy of their marketing initiatives.

Buyers Are Shifting Budgets To Connected TV From Linear Options

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Streaming was another slam dunk industry in 2020, with many people hunkering down with various streaming services. The popularity of over-the-top (OTT) and CTV channels is clearly reflected in ad buying plans for 2021. According to the IAB 2021 Marketplace Outlook, “60% of digital buyers plan to shift linear TV dollars to CTV in 2021 [and] 21% of their 2021 linear TV budgets are expected to be reallocated to CTV.” 

Streaming offers advertisers the chance to effectively target niche audiences, and the first-party data gleaned from enrollments and viewing habits offers unmatched insights into audiences — a priority for brands this year.

Minority-Owned Companies Are More Important Than Ever For Buyers

During and after the racial justice protests in the spring, many brands and businesses committed to supporting more diversity and inclusion in their industries. The IAB 2021 Marketplace Outlook found a similar outlook, with 50% of “buyers looking to place more advertising with minority-owned media in 2021,” leading to an average increase of 26% more ad placements in minority-owned media. In terms of selecting the right media outlets, 51% of media buyers are unsure of how they will “select minority-owned” media to place ads within, and the other 49% are relying primarily on aggregated lists and sell-side platforms to identify minority-owned media placement opportunities.

It’s a new year, which presents renewed opportunities for advertisers to grow their audiences, test new campaigns and lean into fresh ideas. However, the impact of 2020 cannot be overstated, and ad buys are likely to reflect the new behaviors and realities of that watershed year. By staying agile to changing tides and following consumer behaviors, advertisers should be able to reach engaged and ready to act consumers.

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About the Author

Sarah Cavill

With more than 20 years of writing, editing and reporting experience, Sarah Cavill brings to Digital Media Solutions (DMS) a fine-tuned and diverse set of skills. Her work has been featured in notable publications including The Daily Muse, CBS Local, Techlicious and Glamour magazine. Sarah has a passion for current events and the deep-dive research that goes into the content development and brand identity of DMS Insights. In her role as Senior Marketing Communications Writer, Sarah contributes to the pitching, researching and writing of multiple stories published each week surrounding digital and performance marketing innovations in pop culture, news, social media, branding and advertising.

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