The year ahead for Digital Agencies by Fadi Khater

TL;DR: The digital industry will undergo a massive cleanup in 2018 and less garbage will be tolerated, so agencies will need to step up their game and provide a solid offering or get washed away.

No, I will not be predicting that AI, machine learning, AR, VR, video and mobile will be more prominent in 2018. I will not be telling you what products Facebook will launch, nor will I tell you who will copy Snapchat. And I will definitely not be telling you that Amazon will become an advertising/datasuper power.
Despite its significant growth, the digital marketing industry has been witnessing some significant problems ranging from the lack of transparency in ad rates and placement to issues in measurement, content quality, data fragmentation, conversion attribution, fake news and talent identification.

My prediction for 2018 is that the industry will undergo an overall cleanup, resolving a lot of the issues highlighted above. I am by no means a clairvoyant and I do not have all the answers to tech evolution (otherwise I would be ruling the world from my own Greek island). However, below are a few of the key issues the digital landscape has suffered from in 2017, along with my predictions of how these issues will be resolved.
Firstly, let’s discuss digital ads. As opposed to offline ads, online ads are easier to measure and obtain data from, but at the same time much more difficult to analyse. Every platform can give you a million different data points about your ad. However unlike an outdoor ad, you cannot actually see if your ad was placed where you want it to be, or what’s next to it. Publishers are working on several solutions to show advertisers where their ads are likely to appear and allowing them to block content types and specific publications. More publishers will be launching these solutions in 2018 and the accuracy of content and placement types will significantly improve.
Moving on to programmatic, those buying platforms offered the elixir of targeting, information and performance, yet created an iron curtain behind which agencies placed ads in inappropriate places and added exorbitant mark-ups. The platforms then provided custom-made reports showcasing the data that makes the agencies look great. 2018 will start poking holes into these curtains, allowing clients more and more access to, and in some cases ownership of, programmatic platforms. Many clients are starting to invest in their own data management systems and ad-buying platforms to get more control over the process. Clients are likely to own more of the media-buying and management process in 2018. Some of our clients have already moved the entire digital media buying process in-house, thus limiting the media agencies’ roles to consulting.
As for measurement, publishers and social platforms all measure performance in different ways with different calculation methods. Let’s take video views as an example. Some platforms consider a video playing for 3 seconds as a view; others consider 2 seconds with at least half the video on the screen as a view; and others consider entire video completion as a view. This creates issues when comparing performance across platforms – on top of the measurement errors that were announced by different platforms throughout last year. I believe that stricter digital measurement standards will be imposed on publishers in 2018. This will be very similar to the universal micro-USB charger that all mobiles adopted. (However, there will still be a few outliers like Apple’s Lightning cable.) Agencies will have better quality data and be able to create more accurate cross-platform comparisons.
When it comes to social media and content, as the number of agencies offering such services increased, prices, timelines, and quality significantly dropped. This made marketing managers trigger-happy, knowing that they can publish anything anytime. They ended up polluting customer newsfeeds with highly insignificant posts along the lines of “like this post if you are in love this Valentine’s Day” and the occasional click-bait. I believe that due to this increased competition a lot of the smaller players will either get snapped up by bigger agencies, merge with other small agencies or, in some cases, close down. This is likely to generate better quality output and standardise the average price point of social media services.

Fake news is one of the most prominent issues facing content-sharing platforms. Very low barriers to publishing information have resulted in a significant amount of fake news. Whatsapp and Facebook have become a very reliable “source” of information for many (including my parents). Facebook, along with several other players is working on several ways to combat the proliferation of fake news, and this will be a prominent development in 2018.

Verified news, flagged news and alternativesource suggestions will be more prevalent on social channels. This is likely to add some restrictions to the content created by agencies and add some verification procedures. Digital talent is scarce, and there is a desperate need for it – to the extent that when one of our team members added the word “digital” to his title on LinkedIn, he received three job interview requests within two days. This particular person is highly skilled, but when youlook around in the industry and see the people hired for digital roles you’ll notice that either  talent is very scarce or the people recruiting digital talent are simply not qualified to do so.
As people get more on-the-job digital experience, as more students graduate with digital-relevant degrees, and as the number of digital trainings and courses increases, talent will definitely improve in 2018. Platforms such as Facebook, Google and Twitter have noticed the shortage in talent and are making their platforms more and more idiot-proof, by simplifying and automating the creation and management of communities, ads and content.

Digital transformation was among the top corporate buzzwords in 2017. The number of public mentions for “digital transformation” has increased tenfold since 2015 in KSA and the UAE. The need to digitally transform exceeded the understanding of the term and resulted in a manic attempt to overpay for anything digital whether it’s required or not. This is likely to blur the boundaries further between digital agencies and management consultancies. Each entity will start offering more services that currently fall in the scope of the other, and we expect to start seeing some more collaboration and M&As across the two industries in MENA.
Attribution modelling has been among the most difficult measurements to calculate. Here’s an example of an attribution issue: let’s say I saw an ad for X on Twitter, I clicked on the ad and went to the X website but did not complete a purchase. Two days later I decided to buy X so I searched for X on Google, clicked on the ad in the search results and completed the purchase – do you attribute the sale to Google Search or Twitter? I expect more clients to work with agencies on a cost-per-acquisition model and remunerate them based on performance. That means, however, that clients will need to significantly improve their website analytics and tagging; so I expect a surge in Google Analytics Premium (360) implementation across MENA, in addition to enhanced attribution measurement by the likes of Facebook, Twitter, and Google AdWords.
On a final note, it’s amazing how brands are getting away with using gifs from movies, memes, logos, and copyrighted content in their social posts – and very little is being done about it. Just think of Giphy, for example. Digital rights owners are likely to start wanting to cash in on their content through publisher partnerships similar to how YouTube does with the entertainment industry – monitoring videos for copyrighted content and either taking them down or sharing ad revenue with content owners. Agencies will need to start looking at digital copyright more seriously.
In conclusion, if your agency has been bottom feeding and taking advantage of the dirty scraps of digital marketing you’re likely to suffer in 2018 as the industry evolves and cleans itself up.

Link Original Article in Campaign ME