Crisis? What crisis? TikTok and AI spend soars again

Marketers have shrugged off well-documented fears of AI taking over the world and TikTok’s data governance to plough even more spend into emerging channels as they continue to their unrelenting pursuit of top spending consumers.

So says the Mediaocean 2023 Mid-Year Advertising Outlook Report, designed to flag up the most actionable trends and pressing concerns facing the marketing community going into the second half of the year.

The analysis spans trends related to ad spend, creative testing, and audience targeting, as respondents continue to convey confidence in new solutions and emerging channels.

Aggregating insights from more than 700 industry leaders, including brands, media providers, advertising agencies, and tech companies – the report reflects a year marked by the rapid evolution of AI, which emerged as the single important consumer trend to watch for marketers.

The dominance of AI stands in stark contrast to the findings from Mediaocean’s December 2022 Market Research and 2023 Outlook Report, in which respondents cited practical matters such as, “measurement improvements” and “improvements in integrated media planning and execution”, as likely to be the most consequential tech innovations for advertising in 2023.

Additionally, despite the scrutiny facing companies like Meta, Twitter, and TikTok, more than half of marketers said they plan to increase spending on social platforms this year.

TikTok, which has been banned from government devices in the UK, the European Commission, US Congress, Canada, Belgium and a number of US states, continues to grow and be a mainstay for advertisers.

It has also been slapped with a £12.7m fine by the UK Information Commissioner’s Office for a host of breaches of data protection law, including failing to use children’s personal data lawfully.

But nearly three-fifths (57%) of marketers quizzed by Mediaocean chose TikTok and social video when asked about significant consumer trends – a sign of continued momentum.

Connected TV (CTV) was also highlighted as a critical channel with more than 50% of respondents planning to increase ad budgets but the added investment brings challenges, as evidenced by a 40% lift in concern over managing reach and frequency in CTV and digital channels.

However, as this year progresses, marketing leaders project a practical focus on improving workflow efficiency and campaign effectiveness to combat the uncertainty of the past year, and as such, the findings also show the ad industry is stabilising and finding new ways to adapt, the report maintains.

In fact, the survey revealed marketers’ top three areas of investment – performance-driven paid media, measurement and attribution capabilities, and brand advertising – remain unchanged from last year.

Meanwhile, creative testing and analysis showed the biggest year-over-year jump with a 27% increase. Additionally, the survey showed a 16% decrease in concern over talent retention and access to expertise – a sign that the industry is finding ways to manage resources in a post-pandemic environment.

R3 executive vice-president of Innovation and independent research analyst Joanna O’Connell said: “The report provides compelling insight on consumer and marketing trends that are top of mind as we move into the second half of the year.

“Of note, the rapid rise of ChatGPT makes it clear that, if ever there was a time to invest in understanding the role of AI in our industry, it is now.

“Survey responses also revealed the massive importance of newer media like social video (most notably TikTok) and CTV. These are exactly the kinds of emotive, rich environments marketers crave to influence thinking and drive purchase among the millions of consumers that continue to flock to them.

“Additionally, the uptick in interest for creative testing and automation is long overdue. With the convergence of several powerful forces – AI, macroeconomic pressures and data deprecation – the creative process may finally get a much-needed overhaul.”

Mediaocean chief marketing officer Aaron Goldman added: “As is the case with generative AI, we’ve seen some new technologies burst on the scene and disrupt how we think about marketing.

“But we’ve also seen a continuation of trends that have persisted for years such as the opportunities afforded by creative testing and advertising on social and streaming platforms.

“Of particular note, this latest report shows an overall stabilisation of the ad industry which I think will be welcome news for all stakeholders.”