28th Nov 2023

What does more customer control on ads mean for marketers?

More platforms are giving people the choice to control the kind of ads they see, which when married with the rise in ad blockers and subscription-only services poses a new set of challenges for marketers. ADMA CEO Andrea Martens looks at how the industry can adapt to this new reality.

Upfronts season is always interesting, it often creates a real sense of optimism around the market with promises of new innovation from our media partners to help us spend our money more effectively.

One of the announcements of interest though was actually about how some marketers aren’t going to be able to spend their money, with SBS showcasing a new tool that allows users of its on demand service to block ads from wagering, alcohol and quick service restaurant businesses. There are obvious benefits for consumers, particularly those who are struggling with addictions and let’s be honest, responsible advertisers in these categories shouldn’t be targeting this cohort anyway.

In some ways the functionality itself isn’t new, in fact, most of the major platforms already give users access to controls to preference what kind of advertising they want to see – the bigger issue here may be that not all users are aware of these options and in some instances navigation to get to the controls is not always as simple as it perhaps should be.

What is perhaps more interesting is the introduction of this option by a traditional TV broadcaster, which historically did its research in the background and then served their advertising with less personalisation (and real time) than today’s technologies allow. Media convergence (the serving of advertisements across platforms, especially digitally) is changing the offering of broadcast advertising. Making it more personal and putting far more control into consumers’ hands.

This is a world where you sign up to a service and are asked to choose both the kind of content you’re most interested in and which advertising categories you don’t want to get adverts about.

When the choice relates to ‘being responsible’ in categories that should have guardrails around it – well that is already within the responsible marketers’ scope, especially in areas where there are heavy regulatory frameworks. However this level of choice also extends to advertising that relates to a customer's interests in general and this is what will make a marketer’s job more important (and harder).

Ad blockers are also relatively common, with different reports citing a quarter to a third of Aussies are using these tools to stop ads appearing during their internet journeys. And the rising popularity of advertising-free subscription services also points to the fact that some people are happy to pay to avoid advertising.

So what does this all mean?

There is an obvious challenge for marketers - people actively avoiding your (or all) advertising in digital spaces makes the job of selling your product or service that much harder. While we do have some level of control on what we say through our own brands - and in those instances can strive to elevate our marketing to make our campaigns engaging – we also are going to have some level of reliance on our category competitors to lift their game too or else all brands within a category face exclusion (by a customers choice).

This level of choice in the hands of a consumer may also make the customer's brand world a lot smaller as well, putting even more of a premium on being in that inner sanctum of awareness and consideration.

One big issue is that it may also make it tougher for disruptors and challengers to get a foothold in existing categories, creating an outsized advantage for incumbents. That is not ideal for consumers as monopolies rarely lead to the best customer outcomes.

But it may also be an opportunity as well. After all, a teetotaller opting out of getting alcohol ads means you’re not going to waste money advertising to someone who is never going to buy your product (for themselves). But it will also create a premium on advertising to those people who have not opted out at the same time.

So, what are marketers going to need to do to ensure they maintain relevance and create cut-through?

It all boils down to being more customer centric - you need to understand your customer better than your competitors, not just what they look like through data models, as important as those are.

In the FMCG world “getting to know your customer better” may have meant going into a consumer’s house and watching their family cook dinner with the product, then go out with them shopping and watching how they spent their $100-a-week budget and the decisions that came with that.

The visual of this may seem creepy, but think of it as the analogue way of understanding a basket selection. Don’t get me wrong, the data available on a customer today makes it easier to deduce why certain choices were made and analysis of this tracking data can be done at lightning speed (although it is arguably just as creepy).

However, there is something to be said for the in-person method of extracting this kind of information, the real connection with your customer. While it can’t be done at scale due to access, proximity and time, this level of connection with a sample size of your customer base does foster thinking that extends beyond that which we know to be true in our own environments. These experiences can be eye opening and I can attest have made me a better marketer

Similarly you need to ensure your agencies are undertaking the same kind of projects to get the same insights and understanding, otherwise they’ll struggle to really bring your brand to life. This is where the magic happens, where those Eureka moments come to life and all that hard work and investment in data can be made to really pay. It creates a competitive advantage.

It may also impact channel mix choices as well for some categories. We’ve seen a real surge in the out of home market in the last couple of years and I predict it will continue to be a winner in this evolving environment as it is one of the only mass mediums people can’t opt out of.

Of course to get cut through in OOH requires some clever creative to communicate a message in a short amount of time. And the best way to make resonant and relevant messaging is to really understand your customer base.

Similarly word of mouth continues to be an even more valuable channel, particularly for emerging and challenger brands looking to establish a reputation for themselves. I’ve seen first hand the power of this channel working in the beauty space - especially in Asia where people choose products because they've heard about them from their friends.

But that only happens if the product is amazing, and you can only build amazing products by delivering on what your customer truly needs.

As a sidebar it may also see social shopping finally arrive in Australia in force. It’s a phenomenon that’s been happening for a few years in Asia where people actively tune into live streams from their favourite creators to see them demo products. Think QVC for the connected generation.

More broadly there will be a second order effect on the media companies and platforms themselves, as by limiting advertising categories they are inevitably limiting revenue streams. However, this may be topped up by more subscriber dollars and these may also be categories that are eventually limited in their ad spend by regulators anyhow.

So maybe there is a customer-centricity to these platforms getting ahead of future regulation and winning hard-fought goodwill from their users.

It will be interesting to see data around the uptake of SBS’ initiative as wagering, alcohol and fast food are three of the most heavily regulated areas for advertising already. If there is a groundswell of people opting into this then it may show the codes we currently have in these

areas need updating to reflect the will of wider society not to be exposed to these products so much.

Another consideration for marketers will be the kind of data that they get access to which will eventually feed into their decision making and even the dissemination of their ads. With the current review of the Privacy Act still underway, but now within sight of reform being legislated, marketers are going to have to understand the broadening scope of personal information, sensitive information and de-identified information and provide the right notice and obtain the right consent to then use those insights.

As ever, technology will step in to fill the gaps regulators have been slow to act on.

Regardless of your industry vertical, being closer to your customers is never a bad thing. Digital can sometimes be a less personal channel, so finding ways to make your brand more relevant and resonant for the people who are in your market is a key to building affinity and ultimately increasing share.

Technology will continue to force change on us all, but there are some fundamentals of our craft as marketers which will remain timeless. Don’t lose sight of that.