Digital identity in the future looks very different to how we understand it right now. And that change will be driven not by privacy regulations, or the death of the cookie, but by the rise of the Internet of Things (IOT).
The idea of one or two personal devices giving us access to individual consumers will disappear, to be replaced with a range of potential devices – from mobile to voice-activated speakers to connected TV to fridges.
Across those devices a range of different digital identities will exist – some individual (like now), some family/household, some work/B2B, and some more generic.
It’s a paradigm shift – and it’s why the idea the cookie is crumbling as the web shuts down consumer tracking, isn’t actually that big a deal. The medium-to-long term view of how we deliver and measure marketing in an increasingly automated and digital world looks very different, whatever happens to cookie based targeting right now.
Binge-watching of online video is on the rise amongst Singaporeans, who spend on average two hours, 35 minutes watching videos in each sitting according to the State of Online Video 2019 report.
In addition to time spent, Singaporeans are also consuming more online video services. The report revealed that a majority 64 per cent of Singaporeans subscribe to at least one streaming service, and nearly three in four Singaporeans (72 per cent) now use dedicated streaming devices such as Google Chromecast, Amazon Fire TV, or Apple TV.
Globally, people who watch online video spend an average of six hours, 48 minutes per week watching various types of content. Average viewing time is has grown 59 percent since 2016.
Figure 1: How many total hours of video content do you watch online each week (by year)?
Viewers in the US watch the most online video each week at an average of eight hours, 33 minutes, followed closely by viewers in India. Singapore sees the third highest volume of online video viewing.
Figure 2: How many total hours of video content do you watch online each week (by country)?
Latency, or delays in streaming, remains a critical point of frustration for viewers. The report found that more than half of Singaporeans are more likely to watch live sports online if the stream was not delayed from the broadcast. This is because traditional streams are generally delayed by 30 seconds or more from the broadcast feed, and with the rise in social media usage, every second of delay can potentially ruin the game when online viewers learn about big plays from social media before seeing the action online.
Global ad tech company IPONWEB (the super smart guys who built most of the programmatic infrastructure the industry relies on today) has set up a TV Solutions division to capitalise on the opportunities in the rapidly-growing digital TV sector. PwC predicts that one-third of the more than $200 billion global TV market will be traded programmatically by 2021. OTT and CTV (among other acronyms) are a huge focus in the entertainment industry right now, and where the biggest VC bets are being made, from Netflix to Hotstar. Digital in Asia took time to chat to Moritz Wuttke – newly appointed to lead the IPONWEB TV solutions division in the region – about all things Video, OTT and TV in APAC.
Digital in Asia: First off, WTF is OTT?!
Moritz Wuttke: OTT joins the long list of seemingly ubiquitous three-letter acronyms prevalent in digital media. Coming under the ‘advanced TV’ umbrella, it refers to video content that is streamed over the internet without the need for a paid-for cable or satellite subscription – it is delivered ‘over the top’ (OTT) of the traditional closed TV structure.
Content is viewed on any device connected to the internet – smartphones, tablets and laptops, as well as connected TV (or CTV to reinforce the acronym point).
Internet-based TV is now part of daily life for many people and the increasing consumption of internet video content on mobile devices is further driving this trend.
Consequently, the convergence of the digital media and television industries is now an ever-present fact that broadcasters and content providers must take into account.
DIA: Why is TV over the internet important for broadcasters?
MW: Traditionally, broadcasters were the masters of what people viewed and when they did so; the digital age has, of course, turned this on its head. Today’s YouTube and Netflix ethos sees users create vast swathes of free video content that anyone online can watch. Meanwhile, people expect to view what they want, at a time to suit them on the device that is to hand at that moment.
The increasing uptake of streamed video, paid and free, is tipping the balance back again. Broadcasters have developed additional platforms to attract and entertain their audiences, as well as offer them viewing flexibility, whether that is accessing programmes via catch-up or on-demand or binge-watching their favourite shows.
TV over the internet provides commercial broadcasters with additional advertising channels, and with that, new sources of revenue, while programmatic technology enables media trading to be fast efficient and, in some markets, more targeted.
DIA: Why does TV have such an ongoing appeal for advertisers, and do you see this changing?
MW: TV has always appealed to advertisers as the most cost-effective way to reach the mass market. While the broadcast media trading industry is seeing unprecedented changes, the inherent advantages offered by OTT television help the transition.
The various YouTube and Facebook ad placement scandals have shone a spotlight on the need for brand safety – and how difficult it can be to orchestrate in the digital arena. Broadcast TV available over the internet however lets advertisers control where their budget is spent so that it is non-damaging.
At the same time, it is also effective thanks to high-quality audiences and ads that can’t be skipped or fast-forwarded. This has resulted in strong growth of OTT advertising, particularly in the US market where Magna Global estimates that OTT grew 40% to $2 billion in 2018.
Addressable TV raises the bar still further, allowing different ads to be shown to different people, depending on their profile. Advertisers only need to spend where they want the ad to be seen, driving return on investment without the wastage that is typically found in broad-spectrum ad placement. In the UK, Sky leads the addressable TV space, reaching more than 40% of all households.
DIA: What types of brands or verticals are investing in advanced TV advertising, and why?
MW: Direct to consumer, or DTC, brands by their very nature will flock to advanced TV advertising. This will include addressable TV on linear (real-time) TV, where the audience is targeted with ads most relevant to them, and OTT advertising with its pre-roll and mid-roll options as well as relevant ad placement.
Advanced TV advertising is ideal for brands wanting to reach very distinct audiences, whether by geography, behaviour or demography. SMEs may want focus on the very specific locations in which they operate, while a brand that is available nationwide will have a large catchment area but may only be relevant to a particular audience (an air conditioning supplier is most likely to appeal to homeowners and new house-buyers for example.)
At the other end of the scale, TV advertising is now a reality for luxury brands, for whom ‘mass appeal’ has never been an issue. Luxury car-maker McLaren launched its first-ever TV advertising campaign via addressable TV because addressable advertising enabled it to target the right niche audience and deliver ROI.
DIA: How fast is internet TV being adopted in Asia?
MW: In China the majority of TV content is delivered OTT because of the high internet bandwidth available (more than 2.1billion devices are IP connected and can receive video content), while Thailand’s 4G rollout allows good quality internet TV via mobile screens. Overall, 16.3% of Asia Pacific internet users are current OTT subscribers, with show strong growth forecast over the next few years. This is underpinned by investment in the region by a number of large OTT players; we’ve seen the launch of HBO Go Asia and HOOQ, an OTT streaming solution backed by large content providers and local contributors including SingTel.
This shift to OTT services also reflects the ‘mobile first’ preference of consumers; at the end of 2018, more than 61% of webpage views in Asia were on mobile (compared to a global average of 48.2%).
DIA: Why is the shift to OTT happening now?
MW: Television has always held mass appeal – to audiences and therefore to advertisers. What we are witnessing now is the power of TV being made available over wireless networks (i.e. mobile phones and robust home internet connections). As hardware, software and connectivity continue to improve, audiences are increasingly able and willing to watch TV content online.
But it’s not without its significant challenges. Aligning and measuring TV audiences over different channels, non-integrated platforms and transparency are all issues on which IPONWEB is focused, with the goal of balancing investment in OTT with subsequent revenues.
There is certainly both appetite and talent to drive innovation in the television market – and the pace of change is fast, with Amazon and Netflix adding highly attractive content to make the space even more dynamic. Watch this space.
Digitalization of Asia’s commerce brings choice to consumers and opportunity to businesses. It also provides the region’s societies with a path to greater economic growth and prosperity. Better government and business support of the digital economy is needed though, to fully reap these benefits. Greater public and private sector collaborations are also key to unlocking digitalization’s full potential.
While it can appear that the surge of digitalization in Asia – driven by better digital infrastructure, deepening internet and mobile penetration, and rapidly increasing discretionary incomes – is already successfully driving market growth and development, there is tremendous untapped potential ahead. According to Bain & Company, the digital economy contributes just 7 per cent of GDP in ASEAN and 16 per cent in China (as compared to 35 per cent in the US) and stronger digital foundations could contribute an additional $1 trillion to the GDP of ASEAN alone.
To open new markets, the millions who are still excluded from digital marketplaces – particularly the elderly and the poor – must be addressed. Factors such as lack of access to the internet and training and education have left millions unable to participate in this digital market revolution.
Further, according to a recent Economist Intelligence Unit report commissioned by Mastercard, the digital age divide and the digital income divide have meant that the societal gains from today’s digitalization have already been unequal. In each of the region’s economies, a greater share of those under the age of 35 has used the internet to make an online purchase or bill payment than those over 55. There’s a similarly wide gulf between the rich and poor.
Differences in regulations and the level of digital infrastructure across the region compound the issue and hinder Asia’s ability to fully reap the benefits of the digital economy.
To successfully include all of Asia’s populations in the digital marketplace, it is imperative that people have the ability to acquire the necessary technological and financial skills, and governments ramp up investment and infrastructure.
However, this can’t be left to the region’s governments alone. For one, many governments don’t have the financial resources to allocate adequately to digitalization. Two, several simply don’t have the bandwidth to look beyond other more basic problems.
This provides an opportunity for the private sector to step up and fill the void. Whether through partnering with regulators and policymakers to shape the regulatory agenda around what is still a relatively nascent industry, investing in people and businesses so they can leverage digitalisation, or helping bring digital infrastructure and services to those left behind, the private sector must play a more active role.
At Mastercard, we are partnering with fintechs as they take digitalization to the remotest parts of Asia’s economy, resulting in both digital and financial inclusion. Through our global accelerator programme Start Path Global, we support start-ups by providing mentoring, giving them access to our global ecosystem and helping them break into new markets with the help of our relationships and customer base.
We’ve also recognized the need for greater public-private collaboration. For example, in September last year, Mastercard’s Track, a global trade platform, was integrated with Singapore’s Networked Trade Platform in an initiative led by Singapore Customs and the Government Technology Agency of Singapore. This digital trade platform facilitates secure and efficient electronic transactions and payment reconciliation between buyers and suppliers, greatly streamlining and simplifying B2B transactions to facilitate more inter-regional trade.
While there is no one template for these partnerships, a number of similar ways can be found for companies to work closely with policymakers in offering digital solutions and enhancing digital skills. Governments, for their part, can also further support Asia’s digitalization by harmonizing regional regulations with the aim of supporting the creation of seamless, interoperable platforms with uniform governance across countries.
Ultimately, only a rising tide of collective regional effort that includes a combination of greater cross-border collaboration and increased financial and digital inclusion will unlock the full potential of Asia’s digitalization. It will also help create a digital economy that benefits all.
In conjunction with its 7th birthday celebrations the company announced a series of products and services aimed at helping brands and sellers, both small and large, to win market share in the region by transforming them into ‘Super eBusinesses’.
The offerings are aimed at resolving three pain points that brands and sellers face – branding, marketing and sales.
“No seller is too small to aspire, and no brand is too big to be a ‘Super eBusiness’. That is why we are thrilled to roll out super-solutions to help our brands and sellers become more nimble in digitising their businesses, and better reach customers,” said Pierre Poignant, Lazada Group Chief Executive Officer at the inaugural LazMall Brands Future Forum (BFF).
The new solutions include:
A series of ‘Super’ campaigns in which LazMall brands and sellers can choose to take part to boost their brand image and better engage with customers
A new and improved Marketing Solutions Package and Business Advisor Dashboard that can deliver more traffic to their storefronts, and arm brands and sellers with near real-time information to help them make faster and better decisions to sell more effectively and efficiently
New tech tools like Store Builder for brands and sellers to customise their storefronts to differentiate themselves on Lazada, while in-app live streaming, news feed and in-app consumer games can help win the hearts of consumers with higher consumer engagement
At the same time, Lazada has also formalised online retail partnerships with 12 leading global lifestyle, technology and fashion companies, including electronics leaders Huawei, Realme and Coocaa. These collaborations will enable brands to tap on Lazada’s industry-leading tech and logistics infrastructure, innovation and eCommerce expertise. Other brands that are set to join will include several of the world’s biggest FMCG companies.
Backed by Alibaba’s technology and logistics infrastructure, Lazada has been able to launch over the past year a series of industry-leading tech innovations like search-image function, consumer engagement games and in-app live streaming to become the region’s only ‘shoppertainment’ platform on which people can watch, shop and play.
Accelerating the growth of Lazada brands and sellers
The new solutions will also make it easier for brands and sellers to open up stores on LazMall. Qualified merchants can now take advantage of the new self-sign up feature, a simplified sign-up process that can now be completed in mere minutes. This is in line with the Lazada’s goal of enabling SMEs to become globally competitive.
“Since the launch of LazMall in 2018, we have seen tremendous growth among our key pioneer brand partners. We want to extend the benefits of LazMall to even more brands and sellers to elevate their eCommerce operations,” said Lazada Group President Jing Yin. “We want to incubate them so they can grow alongside us and become sustainable and successful eBusinesses.”
Across the region, 60 per cent of small and medium enterprises (SMEs) are keen to invest in technologies to achieve sustainable growth in today’s digital economy. Business-oriented tools including online commerce solutions, customer relationship management (CRM) and business intelligence, have been identified by Lazada as the top investment priorities.
Driving ‘Shoppertainment’ in Southeast Asia
Pushing boundaries in eCommerce in Southeast Asia, Lazada is driving ‘shoppertainment’ to provide shoppers with a fun, interactive and entertaining experience. As part of its 7th birthday celebrations, Lazada is hosting a first-of-its-kind concert, Super Party, in Jakarta on March 26.
The concert, which features a star-studded lineup including British pop star Dua Lipa, culminates with Lazada’s birthday shopping event on March 27. The one-day sale promises a new online shopping experience that includes a new selection of exciting games for redeeming vouchers and attractive deals for consumers in the region.
What are the biggest changes you have seen in digital technology across APAC over the past 10 years?
There is greater customer demand for first-rate user experiences compared to a decade ago. Brands have to evolve their strategies to keep up with the customer, providing seamless interactions and a consistent experience across a wide range of platforms. This is resulting in marketers shifting their focus from the transaction to the experience, where the customer and their lifetime engagement with the brand are at the centre of every marketing strategy.
From a technological viewpoint, this customer-centric focus requires marketers to bring together the vast number of digital solutions used to optimize the customer journey over the last few years into a more manageable stack. It is also leading to an increased focus on granular first-party data to help understand the customer and their needs through detailed profiles. Where brands may once have acted on instinct, or what they felt was right, they now use data to ensure they are making the best decisions.
How has regulation such as GDPR impacted businesses in APAC and their ability to manage and use consumer data?
GDPR covers any organization that handles the data of EU citizens — and in today’s global economy, this means it impacts most companies; including those in APAC. Yet attitudes towards the regulation remain mixed. On the one hand, there is an appreciation that complying with the new rules brings many advantages: by giving individuals power over data and more visibility into usage, the GDPR can reduce privacy concerns, increase trust, and build lasting customer relationships. But on the other, following legislation that goes beyond regional law is difficult. Ahead of enforcement, more than half of firms in Singapore weren’t ready and one month later, only a quarter of Japanese companies had met fundamental rules.
Businesses must keep working towards compliance and recognize that the GDPR doesn’t necessarily require a total internal overhaul – a common misconception. Companies will often find they can make existing systems adherent by connecting them, instead of replacing them.
What can businesses do to better leverage the explosion of customer data we’ve seen as a result of the digital age?
In short, it means putting the data created by greater connectivity into action. As adoption of smartphones, tablets and wearable technology has grown — with 8.6 billion devices set to be in use across Asia by 2020 — the quantity of data produced by consumers has exploded. So, brands now have a larger pool of transactional, demographic, and behavioural information to draw upon than ever. But before they can harness this data as a basis for tailoring customer experiences, companies need to translate it into cohesive and usable insight. And this is no simple task; in fact, 34% of marketers state that the difficulty of unifying data sources is the greatest barrier to better understanding customer journeys.
The evolution from brands talking about DMPs to CDPs as their primary consumer data tool has been very apparent over the past few years in marketing. What’s the difference between these platforms from your perspective?
The answer to this lies in the history of both tools. DMPs were originally designed to gather information about online activity, categorize it and build audience segments, which then fed into other systems such as DSPs. As the complexity of consumer journeys increased, DMPs tried to meet the need for a persistent view of individuals. But because they were only able to store third-party cookies, it was difficult to effectively resolve the many identifiers created by different channels and devices. And this is where CDPs come in. CDPs can collate, synchronize, and activate data from varied sources: generating one centralized store of insight marketers can use to understand and trace individuals across touchpoints. This results in the capability to take consistent and relevant action in real time across an organization’s entire tech stack from a universal data foundation.
This isn’t, however, to say CDPs supersede DMPs; the two can be effective when used in partnership. For example, a CDP can give marketers a ‘single source of truth’ and a complete picture of customer journeys. This insight can then be shared with DMPs to produce better audience segments that ultimately boost ad targeting precision and results.
What can brands do to get closer to the holy grail of a true 360-degree view of their customers in real time?
If brands want to obtain a real-time 360-degree customer view, they must ensure data is well orchestrated. And this means following several core stages that aim to continuously harmonize data. To start, customer interaction data must be collected from every possible source — such as apps, sites, and stores — combined into a single layer, standardized, and cleansed. Simultaneously, this information should also be stitched and enriched; with smart tools used to assess incoming data and transform it into individual profiles that are linked with data from particular devices, once owners are identified.
Because all of this is done in real time, the end product is a complete up-to-date customer profile. Exactly the insight marketers need to understand customers and deliver engaging experiences across channels. Though it’s worth noting that to accommodate ever-evolving individual preferences and habits, they must also check that their orchestration platform integrates with other systems and constantly ingests new data.
How are AI and machine learning changing the way brands engage with their customers?
AI and subsets such as machine learning are already beginning to broaden the horizons of customer interaction by adding new channels to the mix. The best-known examples of this are chatbots — used to provide instant 24/7 services by major brands from Starbucks to MasterCard — and the growing presence of digital tools in physical stores. As recently seenwith the Guess and AlibabaFashionAIstore, which trialled blending real shopping and a range of intelligent tech; facial recognition, smart touchscreen mirrors, RFID-tagged items.
But it’s also important to highlight the applications that are making a sizeable difference to customer experience behind the scenes. Machine learning, in particular, is fuelling advances in data processing; giving brands the means to collect and analyze customer information at scale, and extract valuable insight. This in turn, means data can be quickly harnessed toimprove interactions by enhancing contextual relevance and personal resonance. So long as marketers are taking adequate measures to keep quality and accuracy high, including avoiding bias among the human teams driving AI and data fragmentation.
What are the biggest challenges you see with brands getting to grips with big data in APAC?
One of the most significant challenges is providing communications that keep pace with omnichannel activity. According to a Google study, the majority of APAC consumers prefer to research online and buy in store; with 70% doing so while browsing real shelves. But activity varies by market; Australia and Japan, for example, have large numbers of digital shoppers – especially Japan, where e-commerce revenue is currently more than $80 million.
So, there is no room for archetypes; marketers need all-inclusive insight into the behaviour of specific target audiences. Only by identifying which devices, shopping environments, and ad types work best for individuals can they provide personalized experiences that flow as part of a seamless cross-channel conversation. And that necessitates agile integrated tech, which can be problematic in certain markets that have historically relied on legacy systems. Despite its forward-looking approach to mobile, Japan still tends to use CRM databases that don’t necessarily have the capacity to work with other systems and therefore can’t share data easily.
Finally, how can brands intelligently pull all their data together to build a better, more personalised and more holistic customer experience for 2019 and beyond?
The role intelligent data plays in customer experience will continue to grow as more brands recognize the value of building communications around individuals. Forrester research has shown brands focused on customer experience achieve an annual growth rate of 23% and twice as much return on ad spend — and data is an integral element of this.
But to get every interaction right, brands mustn’t overlook the basics. Constructing a strong foundation of compliant, accurate, objective and perfectly orchestrated data is critical for communications to make a positive impact.
Digital transformation is expected to have the single biggest impact on Malaysia’s economy in the near future, contributing at least 20% to the country’s GDP by 2020. But what does this mean for Malaysia’s telecom industry – and its consumers?
Thanks to the government’s sustained investment in telecommunications infrastructure over the last 20 years, Malaysians are now more connected than ever – through social media networks, mobile and other digital services – with broadband penetration approaching 90%, according to the Malaysian Communications and Multimedia Commission (MCMC). The telecommunications industry has been the biggest beneficiary of this investment. Today, Axiata Group, Malaysia’s largest telecommunications company, has over 350 million subscribers across multiple Asian countries.
On the other hand, growth in connectivity has also spurred an increase in cyber attacks. While Malaysia ranks 3rd in the 2017 Global Cybersecurity Index (GCI), a Microsoftsurvey estimates that economic costs to the Malaysian economy due to cyber attacks can reach as high as US$12.2 billion.
A common target for cyber-criminals is the Domain Name System (DNS)– a first line of protection for a company’s network. Businesses that are targeted face the prospects of lost revenue as well as reputational damage due to breaches of customer trust. The consequences are perhaps most damaging for the telecom industry; EfficientIP’s 2018 DNS Threat Reportfound that the telecom industry had the most sensitive customer information stolen across all sectors from DNS attacks, with nearly a third of companies in Asia-Pacific becoming victims of data theft.
Following DNS attacks, Malaysian political party websites went down on the day of last year’s general election. In response, Malaysia’s National Cyber Security Agency (NACSA) issued an advisory to all government and private organizations that improving their network security is critically important in safeguarding the continued growth of the digital economy. At around the same time, the Malaysian Digital Economy Corporation partnered with the Axiata Group to develop greater capabilities for Malaysia’s cybersecurity industry.
While EfficientIP’s reportfound that the rate of DNS attacks is steadily on the rise, the news isn’t all bleak – many telecom companies already monitor and analyze DNS traffic in real time to detect data exfiltration attempts. Businesses can further improve their cybersecurity capabilities by adopting simple measures such as optimizing IT infrastructures with high-performance DNS servers and decentralizing the DNS architecture. These measures build resiliency to withstand attacks and more often than not, also improve the user experience.
At this critical juncture point in Malaysia’s development, the telecom industry has a critical role to play in ensuring the continuity and success of the nation’s digital transformation. The challenges being faced are high and the stakes are even higher – but such challenges can be overcome and safeguarded with a holistic approach to cybersecurity, starting with DNS.
We’ve all seen the huge rise of interest in programmatic over the past few years – what lies ahead for this technology?
It has taken a number of years for media buying to adopt automated ways of transacting in the region. This is mainly due to this being a more conservative part of the world, where change is not always welcomed, and which still relies on more traditional marketing methods. What lies ahead is a deeper adoption of automation, which will not be limited to standard display or video advertising, but will also include other media too, such as outdoor ads.
As money has always been invested in TV, the shift to digital and then from digital to basic IO has been a lot slower here than it has been in Europe, for example. What’s next for FreeWheel is to use the experience we’ve gained in other parts of the world to help the smoother adoption of automation in this market.
What are your thoughts on the growth of digital advertising in APAC?
Obviously, when it comes to digital growth, the most significant development has been in mobile, which has a massive market share. In certain parts of the region, consumers have on average two to three mobile phones per person. And as APAC is made up of a number of developing mass markets with large populations, it will only continue to grow. Broadcasters are also changing their strategies and moving inventory to digital from traditional TV.
How does the video advertising market in APAC differ to other regions?
The APAC region is very different from the rest of the world, as it contains a number of global markets – each of which has its own complexities and compliances for marketing. Each market has different, local factors that need to be considered. We also have to consider local language requirements, as some might only run campaigns in the local language, whereas others might prefer a mix with English.
Will we see TV and video continuing on their path of convergence?
Yes, I believe this convergence will continue. Traditionally, we spoke to agencies and digital buyers to try and get digital video inventory. Now media buyers are transacting across TV and video. Our aim is to get broadcasters to think about how they trade and bring the two forms of media together, and we want to see this happen on a large scale in the APAC region. Customers who have had success with digital need to start seeing their linear offering in the same way that they view their OTT offering.
With the continued explosion of data from a wealth of connected devices, there is more focus than ever on the way companies collect, manage, and use their data. The last 12 months have seen some big names under the spotlight, but as we shift our attention to the year ahead, what lies in store for digital marketers?
There’s no denying, 2018 was probably one of the most significant years to date in terms of shaping the data landscape. In a year where more than 3.6million Asian Facebook users may have had personal information inappropriately shared with Cambridge Analytica, data has never been more prominent in the headlines.
And data isn’t set to fade into the background any time soon. Rightly, the world has woken up to the importance of data in our everyday lives and, for companies, the ability to mobilise insights from data to drive decisions across all areas of the business is firmly on the radar.
So, amid the introduction of stronger legislation and increasing opportunity – and responsibility – to harness the power of data, plus the potential lure of artificial intelligence (AI) and machine learning, what will the data landscape look like in 2019?
Customer-centricity is priority
In light of new privacy regulations – led by the EU’s General Data Protection Regulation (GDPR) launched in May 2018 – there’s been greater awareness from consumers regarding the use of their personal data. In a world where technology has fuelled rapid advances in all areas of life – from e-commerce to financial services – legislation has been somewhat slower to keep up.
But, thanks to high-profile breaches and changing laws, we’re transitioning to an era where the importance of personal data is much higher on the agenda. In turn, this is forcing companies to ensure they have a customer-centric strategy in place, which clearly places the user’s experience at the heart of all business decisions, with the power back in the hands of the individual.
Build a data foundation first
It’s tempting for companies to get caught up in an exciting digital future – we have already seen AI adoption rates across Southeast Asia grow from 8% in 2017 to 14% in 2018. And while some countries, like Singapore, are storming ahead in terms of innovations – with start-up companies such as CashShield creating noise on a global scale – the picture varies from country-to-country. Most are still working to get the data basics in place first; after all, even the most advanced of machine-learning algorithms are only as good as the data that fuels them. So, it follows that companies must concentrate on building a strong data foundation before implementing any ‘must-have’ technologies.
Many businesses throughout Southeast Asia are still facing challenges with relying on legacy back-end systems, and their priorities at the moment are focused on connecting disparate data silos. In 2018 we saw the premise of Customer Data Platforms gather pace, as companies switched on to the need for a tool to help them collate, enrich, and manage the high volume of event-level data across multiple channels – both online and offline – to create a comprehensive view of the consumer. Putting these building blocks in place is fundamental to delivering a first-class customer experience, and it’s the point from which every other business decision should pivot.
Now is the time to talk about ethics
And what about the appeal of AI, with initiatives such as facial recognition, voice-activated search, and online chatbots? There’s no denying its potential and – while companies ready their datasets with clean and accurate data to get to a point where they can successfully adopt these technologies – now is the time to talk about the guidelines we need to ensure machine learning algorithms are unbiased and ethical – rather than waiting until mistakes have been made. It’s our responsibility, as an industry, to get this right.
We have already seen the creation of theSingapore Advisory Council on the Ethical Use of Artificial Intelligence (AI) and Data, set up with representatives from Google, Microsoft and Alibaba – designed to develop a trusted and vibrant AI ecosystem in Singapore. And with India releasing an AI strategy discussion paper, the UK creating a Centre for Data Ethics and Innovation, and worldwide issues being monitored through the AI Global Governance Commission, there are signs of a shift across the globe which will continue in 2019.
While this reflects the need for new and updated regulations that are relevant to today’s digital landscape, it also addresses a changing approach from companies about how they view consumers’ data. No longer just an ‘asset’, we are starting to see a real understanding and respect for its true value, with focus returned to the individual – rather than a collective audience segment.
The data landscape in 2019 may follow a theme of regulation – but at its heart will be a strong emphasis on the customer – regardless of what new tech may be dominating the headlines.
The start of 2019 sees digital facing a bright future. Not only are consumers optimistic about smart technology — with 73% in China anticipating a positive impact — but the advertising industry is also flourishing. Digital spend in Asia Pacific hit $70 billion in 2018, and by 2022 that figure will reach $110 billion: over half of the total ad market.
So, what does this mean for 2019?
According to industry leaders, the popularity of automation will see programmatic become the norm, while mobile retains its advertising crown and TV becomes increasingly entwined with digital. At the same time, marketers will also start to realise that effectively mastering artificial intelligence (AI) takes more than simply tech know-how.
Let’s explore the key trends:
Rashmi Paul, Commercial Director, Asia Pacific at FreeWheel
“While the adoption of automation has been slower in South East Asia than in other regions, advertisers – in their quest for qualified and measurable audiences – are making it the driver of change in 2019 and beyond. We’ll see less media buying through a site-list or a programme-list only, but a deeper commitment to automated content, not just in standard display and video advertising, but in other areas such as outdoor media.
“With people in the region owning two to three mobiles each on average, the mobile app market will continue to grow in 2019, thanks in part to the popularity of gaming and social media. But we will also see an increase in the OTT market, which hasn’t taken off in APAC up until now – both in app, and through the TV. This will be helped by improving internet strength, making it easier to watch content on the move.”
“One of the best things about pioneers is that they blaze a trail for others to follow. China, for example, has so far led the mobile market: aggressively investing in m-commerce apps and testing new features. It is also thebiggest driver of global digital advertising spend in Asia Pacific. But due to the groundwork put in by China, there is now a booming mobile economy and programmatic advertising scene for its neighbours to leverage.
“In 2019, we can expect an influx of new players in automated mobile advertising and app development. And these market entrants will have many advantages. In addition to gaining insight from this mobile advertising evolution – such as the formats that drive high engagement, like interactive ads, and those that inspire use of blockers, like interstitials, they will have an understanding of what works well in their region. This might include offering lower app prices in particular areas and the option to pay via carrier billing. The time is coming for new innovators who have watched mobile advances from the sidelines to put their knowledge into action.”
Satoru Yamauchi, Director of Partner Services, OpenX
“Video already dominates Japan’s digital advertising landscape, with spend set to top $200 million this year. Moving into the new year, video will command even more advertising dollars especially on mobile, where consumers are increasingly spending more of their time. The number of smartphone video viewers will grow to nearly 40 million in 2019 and advertisers looking to reach these audiences will need to build campaigns with a mobile specific user experience in mind. Formats that interrupt user activity or delay content access are likely to irritate consumers and fuel negative brand associations. This is especially true in the mobile context, where large ads block content on small screens, slow down load times and eat into data allowances. To ensure a positive user experience, advertisers should harness engaging ads that give consumers a choice about how much they wish to interact with brands, such as opt-in video, which provides a genuine value exchange between advertisers and consumers.”
“With a growing emphasis on connected devices, and the subsequent explosion of data, in 2019, there will be even more demand on companies to manage an increasing amount of insights. While in 2018, businesses were keen to harness artificial intelligence (AI) and machine learning, they didn’t necessarily fully understand it enough to utilise it to its full potential. In 2019 we will see a greater focus on the quality of datasets behind the algorithms – which fuel tools such as these – and businesses will look to build a strong data foundation before jumping on the latest tech bandwagon. We think a mantra of ‘go boldly, tread lightly’ will be particularly relevant to many companies. They will need to put in place the tools to effectively collate, manage, and enrich data insights – and be able to connect disparate data silos, such as ecommerce, call centre, and legacy back-end systems to create a 360-degree view of each customer.
“In addition to this, we will see changes to roles within the workforce to better understand technologies such as AI and to cope with the increased focus on data as the basis for business decisions. Already, the World Economic Forum suggests the leading job roles over the next five years will include data analysts and scientists and there will be a focus on training new talent. There is evidence of this taking force with Asia’s investment in education and the digital economy, which will ensure employees are better equipped to manage emerging technologies like AI.”
With industry innovators poised to drive market diversity, efficiency, and expansion across Asia Pacific, the outlook for 2019 looks promising. Existing forces such as mobile and video will gain greater strength, and emerging developments in connected TV will bridge the gap between online and offline. As long as quality remains the foundation of progress — covering user experience and data — digital advertising will continue to offer equal value for all.