Dynamic Creative Optimization, AR Become Alternatives To Target Ads: Emodo Institute

Brands with in-house teams are 82% more likely to use augmented reality (AR) than external agencies, according to data from Emodo Institute, the research arm of Ericsson-owned Emodo. It’s one of the techniques being used as the industry moves away from device IDs and browser cookies to target ads.

Emodo Institute polled more than 400 marketers for its Voice of the Marketer Research Series Part 2 report to analyze ad-creative preferences and trends, as legislation continues to restrict the type of data brands can use to target ads.

Immersive creative formats like AR have become a priority. When choosing new ad-tech vendors, marketers who experience campaign challenges from the lack of ID technology are 84% more likely to prioritize immersive creative formats in their strategy.

Dynamic Creative Optimization (DCO) users are keeping an open mind, with nearly 85% of DCO users open to vendors offering new versions of the technology that are better suited as the privacy landscape continues to shift.

The study focuses on preferences and adoption of creative formats such as AR, DCO, and Native Advertising. It highlights marketers' views on the appeal and the effectiveness of specific creative formats, and provides insight on correlations between creative strategies and concerns around the loss of tracking data.

Immersive AR experiences have been used primarily by direct-to-consumer (D2C), retail and consumer product goods (CPG) companies. They have created what the study calls “compelling” AR experiences on their websites, in apps and other owned media channels, but only recently has this type of media has become scalable.

Brands can personalize and target AR ads with or without IDs. About 3.5 billion devices globally support AR experiences, and 74% of consumers agree that these ads are more likely to capture their interest or attention than other, more traditional ads.

Two-thirds of marketers participating in the survey who say they are concerned about privacy and identity have used AR in marketing, but most have yet to adopt AR in advertising campaigns. Some 73% of those AR marketers are experiencing ID-based scale issues in their advertising.

Of the marketers who have experienced campaign issues due to ID loss, brands with in-house agencies are more likely to prioritize immersive creative formats and capabilities when choosing new vendors vs. agencies.

DCO algorithms determine in real-time the elements to display in an ad for each user. The algorithms continually learn and improve, based on audience responses to specific variations. 

The technology has become more popular, but similar to other advertising techniques that rely on signals from tracking IDs, traditional DCO is becoming less effective as those signals disappear. And it may be why “the vast majority of DCO users consider DCO to be ‘emerging’ and are open to new, innovative versions of DCO,” according to the study.

While DCO has been around for a few years in an exploratory stage, 85% of marketers say the strategy has become to drive “substantially better results,” but 88% still consider the technology “emerging.” Interestingly, direct-to-consumer brands are 48% more likely to frequently use DCO.

Native advertising is appealing to consumers because they can be engaging without being disruptive or intrusive. Marketers concerned about privacy/identity are more likely to be regular users of native inventory. Of those concerned about privacy and identity, 88% are more likely to consider media partners who offer “emerging channels or environments” including native.

Overall, the findings from the Emodo Institute study on Creative and Identity reveal convergence of creative trends toward dynamic, immersive and native formats and perspectives of marketers seeking new paths to success in a post-ID world.

It also identifies that most marketers experiencing campaign issues as a result of ID loss now think about advertising differently and are willing to explore new or reimagined creative options, rather than simply trying to reestablish opt-out tracking models.

As marketers becomes increasingly focused on privacy, several familiar ad formats continue to evolve and become ID-independent.

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