– The ad industry is constantly evolving as new technologies, platforms, and consumer behaviors emerge. 

– 2023 will bring many new trends that ad agencies will need to understand and leverage to remain competitive.

– In this post, we will explore the top ad agency trends to keep an eye on in 2023. Understanding these key trends will help agencies prepare for the future and continue providing results-driven marketing strategies for clients.

Trend 1: The Rise of Artificial Intelligence and Machine Learning

– AI and ML are completely transforming the ad industry, providing enhanced data, insights, targeting, creative optimization, and more.

– Ad agencies need to fully embrace AI/ML and integrate them into their workflows. Examples:

  – Using AI for data analysis and interpretation 

  – Leveraging ML algorithms for predictive consumer insights

  – Personalizing ad targeting and messaging with AI

  – Automating repetitive creative tasks with AI

  – Optimizing campaign performance with AI testing and learning

– Ad agencies that don’t adopt AI/ML will fall behind those that do. It’s a must-have set of technologies for the modern agency.

Trend 2: Adopting First-Party Data Strategies

– Due to tightened privacy laws and the phase-out of third-party cookies, first-party data is becoming critically important for ad targeting and personalization.

– Agencies need to help clients directly collect first-party data through:

  – Website/app behaviors

  – CRM data

  – User subscriptions 

  – Loyalty programs

  – Surveys and research

  – Social media engagement 

– This data allows for privacy-compliant, personalized ads based on direct consumer insights. Agencies need to develop expertise in collecting and activating first-party data.

Trend 3: The Rise of CTV/OTT Targeting

– As consumers move away from linear TV, connected TV (CTV) and over-the-top (OTT) platforms are exploding. 

– Ad agencies need to take advantage by:

  – Shifting TV ad budgets to CTV/OTT 

  – Testing and optimizing ads across different CTV/OTT providers

  – Using data to target and personalize CTV/OTT ads

  – Developing engaging ad content optimized for CTV/OTT viewing

  – Measuring CTV/OTT performance and incrementality 

– Agencies that successfully target CTV/OTT will unlock huge opportunities as budget moves to these platforms.

Trend 4: Building Martech Expertise  

– Marketing technology is growing exponentially, with over 8,000 martech solutions available today.

– To help clients effectively leverage martech, ad agencies need deeper expertise across:

  – Marketing automation

  – CRM platforms

  – CDPs/DMPs

  – Email marketing and retention tools

  – Attribution and analytics 

  – Social media management 

  – Content platforms

– Becoming martech consultants will bring great value to agency clients in 2023.

Trend 5: Improving Ecommerce Capabilities 

– Ecommerce advertising is one of the fastest growing sectors today. Winning ecomm clients takes specialized expertise.

– Ad agencies should enhance ecomm capabilities by:

  – Building teams experienced in ecomm ads, especially on Amazon

  – Developing best practices for optimizing ecomm ad campaigns 

  – Using data and testing to improve product targeting and ROAS

  – Consulting on website UX, product pages, and checkout optimization

  – Providing insights from aggregating performance data across ecomm clients

  – Staying updated on connected TV, digital out-of-home, and other emerging ecomm ad platforms

– Elevating ecommerce expertise will help ad agencies win and retain valuable ecomm clients.

Trend 6: Delivering Business Outcomes with Measurement

– As the ad industry matures, there is a shift from purely campaign-focused metrics toward measuring the actual business outcomes of marketing. This is challenging but also an opportunity for agencies to showcase additional value.

– Ad agencies can better prove marketing ROI by:

  – Collaborating with clients to identify core business KPIs

  – Developing models to quantify marketing’s impact on sales, revenue, web conversions, and other business metrics

  – Investing in multi-touch attribution to understand marketing’s influence across channels

  – Considering incrementality testing to measure the true lift generated by campaigns

  – Commiting to longer-term analysis of marketing effectiveness rather than short-term campaign metrics

– Delivering measurable business impacts will strengthen agency relationships and prevent marketing budget cuts.

Trend 7: Authentic Brand Building

– Consumers expect brands to have purpose, take stands, and maintain ethical practices. Brand marketing must evolve to meet these changing attitudes.

– Ad agencies can help clients authentically build brands by:

  – Identifying social causes and community initiatives that align with the brand’s values and identity

  – Creating brand content centered on diversity, inclusion, sustainability, and social responsibility

  – Ensuring brand messaging and experiences feel relatable, genuine, and human

  – Avoiding controversial topics or issues that feel artificial or forced

  – Maintaining transparency about brand practices and being accountable

  – Listening to consumers and speaking openly and honestly as a brand

– Brands that “walk the walk” on social issues while avoiding empty marketing gestures will earn consumer trust and loyalty.

Trend 8: Emerging Social Media Platforms

– Major social media platforms like Facebook and Instagram are saturated with brands. Ad agencies should explore emerging platforms where audiences are highly engaged but competition is lower.

– Top emerging social platforms to test in 2023 include:

  – BeReal: raw, unfiltered content

  – Reddit: active communities of niche interests

  – Discord: chat servers for specific user groups

  – TikTok: short videos with creative effects

  – Twitch: live-streaming gaming platform

– Agencies should also watch for the “next big thing” – new networks catching fire with Gen Z audiences. Getting in early allows for lower costs and the chance to define the platform’s advertising best practices.

Conclusion

– The ad industry will continue rapidly transforming in 2023 with new technologies, platforms, and consumer behaviors reshaping marketing.

– Ad agencies that understand and embrace the key trends around data, targeting, measurement, martech, and social platforms will gain a distinct competitive advantage.

– By leveraging these 2023 trends, ad agencies can future-proof their service offerings and provide the forward-looking strategies their clients will demand.

– The ad agencies that lean into these changes have an opportunity to accelerate their growth and solidify their positioning next year.