Spending on global advertising is set to rise by an overall 5% this year, with digital fueling the growth, according to new data.
ADVERTISEMENTThe latest analysis, from the global advertising holding company Dentsu, pinpoints digital ad spend rising at 7.2%.
“That means we’re going to see an increased amount of shift towards digital, which means digital is now 60% of the total advertising spend globally,” Will Swayne, Dentsu’s Global Practice President (Media), told Euronews Business, at the Cannes Lions Festival of Creativity.
“Within digital, there are real-fast currents: connected TV, social continues to grow and retail media is really growing fast across Europe and still within the US marketplace.”
Building back advertising volume
The rosy outlook for digital comes in the wake of inflation pressures hitting the pockets of consumers, along with advertisers reflecting on where they can drive growth.
“A number of consumers have taken on a lot of the cost of inflation and the increased pricing of those products,” said Swayne.
“What we’re seeing now is that there’s been some volume drop. Now it’s all about, right, how do the advertisers ensure that their brands are building up market share and volume again?”
The rise of personalised ads
But with digital increasingly in the sights of advertisers, where is the balance between engaging consumers and overkill?
Swayne thinks the answer lies in “relevancy,” highlighting: “That’s the exciting thing about advertising becoming increasingly digital. It’s becoming increasingly accountable, which means that we can really make sure we’re being relevant to the consumer and ensuring they’re getting the right message, at the right time, at the right place.”
Relevancy comes down to personalisation and hyper-personalisation in the targeting of adverts, with sectors such as travel and tourism already jumping on these trends. Throw artificial intelligence (AI) into the mix, and Swayne believes you have a successful formula.
“AI plays a massive role in the future of advertising, particularly as we see that digitalisation happening. There are a number of the platforms, the Microsofts, the Googles, the Metas, who are already building really strong AI components within their businesses,” he said.
“That is really enabling us to be much more efficient and effective in the way that we’re targeting, to be able to really drive that personalisation.”
Balancing AI and human talent
But the advertising industry is aware of consumer concerns around their use of data. Questions continue to abound in the creative industry too about the role of AI and what it means for the future of human roles.
“There is always going to be a balance between AI and automation and people,” said Swayne.
“But we’ve just got to lean into AI to make sure that we’re understanding the right use cases for the particular brand, for the particular audience you’re trying to reach, in how we build out campaigns, but also other campaigns we’re delivering to make sure they are as immersive as possible from an experience standpoint.”
Watch the video above to see more from the interview with Dentsu.
You can see more content from Cannes Lions here.
