E-commerce, addressability, performance marketing, and data will be the key focus areas for GroupM in 2022, says GroupM India President – Data, Performance and Digital Products Atique Kazi. In an interview with exchange4media, Kazi spoke at length about the evolving trends in the digital advertising ecosystem besides the work being done by the agency to help its clients in areas like connected TV, e-commerce, and creator economy.
Exceprts:
As President of Data, Performance and Digital Products, what will be your key agenda for GroupM in 2022?
The areas that I would be focussing on would be e-commerce, addressability, performance marketing and data. When it comes to e-commerce, what I am trying to do is to reimagine our e-commerce practice that enables our clients to be on top of their game in media commerce, brand dot com, and marketplace activities. On the addressability side, I am sowing the seeds of addressability for the future and launching India’s first addressable TV solution. My third focus area is performance marketing. The idea is to craft our performance marketing offering into a full-funnel marketing ecosystem that would deliver hard outcomes to our clients. Lastly, it’s about collaborating with my colleagues at GroupM to create a robust data spine that feeds into every single Operating Company (OpCo) and specialist functions within GroupM to give them that data edge.
India has emerged as a testing laboratory for tech companies. Do you see agencies following suit wherein advertising and marketing solutions and innovations will come out of India and then travel to global markets?
Absolutely! There have been a lot of innovations that are India-first. If you look at the GroupM ecosystem, there have been certain data applications where we have ingested first-party data and looked at other sources to create cohorts, and on that basis, given outcomes to clients. From an innovation lens, there is a lot of work happening in the areas of addressable TV, automated content recognition, etc. The role of an agency is to really go ahead and use these levers, try it out in India, scale them up and then possibly take it across the world. In India, we have seen data through a different lens. We have seen a lot of innovation and application of data sets that have come out of India.
According to you, what are the key trends to watch out for in 2022?
There are five or six important trends to watch out for. 1) Brands will focus on communication led by purpose, diversity, and inclusion that resonates with their audiences. This will not be limited to millennials or GenZs but it will apply to all sets of audiences. 2) Marketing and advertising teams will see massive restructuring both at the advertiser and the agency level. There are lots of opportunities and challenges in the digital era. 3) Creator economy will create content around the customer and that will play a very pivotal role across all funnels of advertising. 4) Advertisers can’t shy away from Metaverse, NFT, blockchain, and cryptocurrency-based applications. I think this will go beyond the fad and you will start seeing a lot of use cases in this space with our advertisers. 5) Big debate on privacy, user consent, zero party data, federated learning, and data clean rooms will be a part of all advertising events without a miss.
How is the Indian advertising ecosystem responding to technological innovations like Metaverse, NFT, and blockchain?
It’s early days, but a lot of brands are already experimenting and trying to see where they can possibly have a massive play on metaverse and where it makes sense at this point in time. Obviously, we know that there are lots of use cases in the gaming sector. Brands are trying to get into the games and play their metaverse version out there. I feel that a lot of other industries will start adapting metaverse applications in India, and they will be somewhere focused on areas of infrastructure, retail, and social media. So, clients on this side would adopt metaverse first in these areas in 2022.
What opportunity does CTV provide to advertisers?
This is one area that agencies and advertisers cannot ignore because of the rapid growth of users in the CTV space is phenomenal. To begin with, advertisers should start looking at CTV advertising through the lens of household targeting and not online video advertising. That’s the key differentiation, to begin with. CTV brings starting point of addressable TV into the market. Very soon we will see linear TV that will also start becoming addressable TV in some manner. We have seen that in the US, UK, and Australia. With CTV, advertisers can actually start building a unified approach on TV advertising on both people connected via the linear feed and the CTV feed. We have a very omnichannel view that comes through this. This will help us in three broad scenarios. Advertisers can look at CTV to build incremental reach curves. They can also build efficiency on the overall TV plan on cost per impression views. In some cases, they can also do razor-sharp targeting to a household in a specific geo key like a postcode that has a high concentration of their target users in that geography.
Advertising on e-commerce marketplaces is gaining a lot of traction. What is driving the advertising growth for e-commerce platforms?
Earlier, media planners used to evaluate publishers on the basis of eyeballs for media buying. Now, planners are evaluating marketplaces on category transactions. This is a change of mindset that one has seen in marketplace advertising. Today, a lot of e-commerce marketplaces feature on the Top 30 publisher list in terms of share of ad spends. That is something new that we are seeing in 2021 and 2022. I predict that we would have at least four players among the Top 20 publishers in terms of ad spend share that would be e-commerce led. Amazon and Flipkart are dominant players in the e-commerce advertising ecosystem but there are so many other marketplaces that are growing tremendously and there are millions of shopping nano moments that are being created on e-commerce which provide a huge opportunity to have an always-on e-commerce advertising approach for brands.
The whole video advertising opportunity around making shopping intent data addressable on quality inventory and optimising it on hard return on advertising spends or transactions is where we will see a massive increase coming. The creator economy also helps to scale the video commerce aspect of it through social commerce, live sale events, drops, seasonal edits, and ad-funded short-form videos.
As far as social commerce is concerned, where do you see a large chunk of ad dollars going because short video platforms have pivoted to social commerce while e-commerce platforms are also doing influencer-led commerce?
Spends will stay where the audiences are. A large part would be played by the creator economy because audiences are following these creators. As I said, the creators will create content around these customers. Anywhere the customer is you would start seeing that a large part of the focus will be towards these short-form videos. We have seen that in markets like Indonesia, China, and Thailand, and we will soon start seeing that trend getting adopted here as well. The baseline of where the shopper intent is and the data that is passed back through these ecosystems like the big marketplaces, we will see a fair share of advertising money going in that space.
Do you think performance marketing will continue to hold sway over other forms of digital advertising in 2022 since it delivers actual results?
I agree and disagree that it will hold sway because the nature of performance marketing itself is that it gives you the lower funnel acquisition and that is the reason it will hold sway over other forms of digital advertising. If you look at it from a holistic point of view the attribution towards the lower side of the funnel is not really fair because what we have seen is that without effective spends on the top and middle funnel of advertising, performance advertising at a larger spend dries out. I believe that having the right measurement and accountability at top and middle funnel media investments which really impact the lower funnel is definitely the way forward. Due to the death of last-mile attribution, the industry is moving towards a multi-touch attribution model where insights and analytics can play a massive role to figure out where the conversion is coming from and the right weightage can be given to those specific touchpoints. Performance marketing will hold sway but it will transform into a full-funnel marketing approach.
The share of programmatic advertising within the overall digital advertising pie is expected to go up significantly in 2022. Can you explain why programmatic advertising is being touted as a one-stop solution for advertisers?
When I started my programmatic journey back in 2010 with Yahoo-owned Blue Lithium followed by Xaxis, we started with the vision that one day all advertising will become digital, and digital advertising will become programmatic. Digital advertising provides targeting, precision, and measurement, but at the same time, it also brings a lot of variety and complexity. For example, online video advertising has been a big driver of growth for the industry but the decisions to be made are so many like do I go AVOD, do I go BVOD, do I look after brands, ad fraud, viewability, channel type, location, demo, time spent, quartile reports, creatives, ad fatigue, frequency, and the list goes on. Programmatic advertising offers a method to the madness and what’s happening is that new channels like radio and outdoor content are becoming more and more digital. It’s important to access these in a programmatic way for better delivery and better one view. It also enables the use of new-age technologies like AI, ML, first-party data, and federated learning where one can have a full view of advertising spends and then try to deliver a very omnichannel hyper-personalised approach to advertising spends. It definitely has some blockers where we have to deal with walled gardens which are here to stay.
Google will be phasing out third-party cookies and will be replacing them with an interest-based advertising solution called Topics. How is the Indian digital advertising industry preparing for the cookieless advertising era?
The role of cookies for advertisers initially was decision-making on whom to show the ad and when to show the ad. From an India market perspective, when you look at it from a targeting lens, I don’t see a massive impact because India is predominantly a mobile-first market. The effect of cookie deprecation will be in the area of measurement. We have already seen in Western markets that third-party measurement systems which were thriving have been severely affected and the effect is seen in the areas of consumer tracking, cross-platform analytics, basic measurement metrics in terms of viewability and target reach. The cookie deprecation will also push us one step back on universal frequency capping as well. The new framework tries to solve these impacted areas but I haven’t seen them doing really well. Even Federated Learning of Cohorts (FLoC) hasn’t been successful. As a result, I feel that contextuality will get its fair share back. In the new privacy era, marketers will have to move from precision marketing to predictive marketing frameworks. The predictive marketing framework will be on the basis of first-party data which they need to ace their game on. I also feel that the Supply Side Platforms (SSPs) will become more prominent than the Demand Side Platforms (DSPs) in the future because the publishers with the consent of the users will be creating some amazing data sets and now it will be putting that information to SSPs. Earlier, we saw that DSP had the data and they used to overlay that on the SSP supply but now SSPs will bring in a lot of data signals and audience information.
What kind of solutions is GroupM planning to launch for clients?
From a GroupM perspective, we are channelising the entire market through the lens of programmatic to be accessed via Private Marketplace (PMP) because a large part of the business in India on programmatic is done on a programmatic guaranteed (PG) basis. While it has its advantages, I think the supply needs to be on PMP set-up to take advantage of the full potential of programmatic. We are working with publishers to get them on to a PMP set-up where we can access inventory and do addressability at its best. We are running certain projects like an SPO (Supply Path Optimization) where we are providing a lot of education to the publishers, working with SSPs to enable that. In 2022, a lot of supplies that we used to access via PG will now move on to PMP. It’s very important for the publisher to go this route because if you look at large advertising ecosystems like YouTube, Google, or Facebook, they do offer this mechanism where one-to-one targeting is razor-sharp, it’s always accessible, and you can make decisions on every single impression on an ad call that comes through. Until and unless our ecosystem and publishers don’t move to the PMP set-up I see gaps that will continue to happen.
How are advertisers preparing for marketing in the age of data privacy?
Every organisation will have its own data play and it will be a privacy-first data approach that every single party needs to bring on to the table. Advertisers will need to invest in Data Management Platform (DMP) solutions where they are harnessing user information about the data where they can possibly have personal level data and then how they can connect it to the addressable level of data from thereon. Agencies like us would have their own DMPs. Publishers have already moved in that direction with the GDPR thing that we saw in the market where all publishers have now started to get consent from their users upfront. So, now data will start sitting in these three specific cohorts and the new space is where technology will play an important role and you will see new investments and applications coming through in the form of data clean rooms or data safe rooms where I can bring in my data without the risk of it being compromised and then take it to get more insights or better targeting or better addressability on that. We will see that part of the ecosystem gaining traction.
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