Adtech leaders prioritize sustainability in evolving digital landscape

Industry leaders are increasingly prioritizing sustainability and social issues when making ad spend decisions. This shift comes as companies grapple with changing consumer habits, data privacy concerns, and the impending deprecation of third-party cookies.

A recent study commissioned by Equativ and Sharethrough, conducted by Forrester Consulting, sheds light on the current priorities and challenges faced by advertising and marketing executives. The study, titled Future-Proof Your Adtech Partnerships, surveyed 212 US-based leaders at brands and agencies with annual revenues of $500 million or more.

Sustainability takes center stage

According to the study, 79% of respondents consider environmental and social issues when directing ad spend. This focus on sustainability is expected to increase in importance over the next two years, with 50% of respondents planning to decrease the carbon impact of their advertising efforts, up from 47% currently.

Michael Sadicario, Managing Director at Equativ, emphasized the strategic approach marketers are taking: "Despite the immediate challenges posed by the evolving digital landscape, including shifts in addressability and the phase-out of third-party cookies, savvy marketers are adopting a long-term, strategic approach to safeguard their brand's reputation and core mission."

Customer engagement drives revenue goals

The study reveals that customer engagement is critical to achieving advertising goals. The top-ranked annual objective for 60% of respondents is growing revenue. This goal is closely tied to customer-centric objectives, including:

• Improving customer satisfaction (52%)
• Increasing customer retention (48%)
• Boosting search visibility (49%)
• Increasing site traffic (45%)

These findings underscore the importance of maintaining strong, engaged customer bases to drive revenue growth.

Balancing efficiency and performance

In addition to sustainability concerns, 77% of respondents value efficiency and performance over access to exclusive inventory. This preference indicates a shift towards doing more with less, potentially aligning with sustainability goals by reducing waste in advertising operations.

Laura Bromwich, SVP Sales at Sharethrough, commented on the findings: "We believe the study demonstrates that ethical advertising is not only alive but is a crucial area of opportunity for all stakeholders in the ecosystem—brands, consumers, and adtech companies alike."

Challenges in the programmatic landscape

Despite the focus on sustainability and efficiency, advertising leaders face several challenges in the programmatic advertising space:

1. Supply Path Optimization (SPO): 67% of respondents find SPO challenging, indicating difficulties in streamlining the ad buying process.
2. Reaching Addressable Connected TV (CTV) Audiences: 62% struggle with targeting viewers on CTV platforms effectively.
3. Evaluating Placement Quality: 64% face challenges in assessing the qualitative aspects of ad placements.
4. Accessing New Inventory Sustainably: 63% report difficulties in accessing new inventory in a sustainable manner, such as working directly with a large number of publishers.
5. Addressing Targeting in a Cookieless Environment: 66% find it challenging to develop targeting strategies as third-party cookies phase out.

Preparing for a cookieless future

The impending deprecation of third-party cookies remains a significant concern for advertising leaders. The study found that:

• 77% want to learn more about available cookieless solutions before committing to one.
• 73% feel that regulatory uncertainty makes it difficult to commit to a cookie replacement strategy.
• 64% find implementing measurement strategies to contend with data deprecation challenging.

To address these challenges, respondents are exploring various alternative data strategies:

• 57% plan to adopt data clean rooms
• 53% are considering seller-defined audiences
• 50% are looking into alternative IDs
• 48% are exploring contextual targeting

Brand safety and transparency remain critical

When selecting adtech vendors, respondents prioritize features that align with their values and ensure brand safety:

• 85% consider brand safety standards important or very important
• 83% prioritize transparency
• 83% value ease of use
• 81% look for global reach and presence
• 80% focus on progressive topics, including sustainability, diversity, equity, and inclusion (DEI), and multicultural inclusivity

Industry implications and future outlook

The findings of this study indicate a significant shift in the advertising industry towards more sustainable, ethical, and customer-centric practices. As the digital landscape continues to evolve, advertising leaders are seeking partnerships that can help them navigate these changes while maintaining brand integrity and meeting consumer expectations.

Sadicario noted, "Marketers view the presence—or absence—of third-party cookies not as a pivotal factor for future success, but rather seek partners that can significantly enhance customer connections, including technologies that support sustainable and brand-safe strategies."

As the industry moves forward, companies that can provide solutions addressing these key concerns – sustainability, efficiency, brand safety, and adaptability to a cookieless future – are likely to be in high demand.

Key Facts:

• Study conducted in May 2024
• 212 US-based advertising and marketing leaders surveyed
• 79% consider environmental and social issues in ad spend decisions
• 60% prioritize revenue growth as top annual advertising goal
• 77% value efficiency and performance over exclusive inventory access
• 85% consider brand safety standards crucial when selecting vendors
• 57% plan to adopt data clean rooms to address cookie deprecation