Digital Advertising Trends For 2022

Some key highlights from the latest financials of Google (Alphabet) and Facebook (Meta) also show some of the changes in the digital advertising landscape. This, in turn, is affecting millions of small businesses across the world:

• The pandemic determined a mobile transition: while companies like Google and Facebook have been investing in mobile-first for years. In reality, it was the pandemic that accelerated the trend. For both Google and Facebook, mobile traffic is the only growth driver. An interesting note here: Google (thanks to its vertical integration) managed to monetize its increased adoption. Facebook, on the contrary, hasn’t, and this was definitely due to Apple’s privacy change.
• Supply chain of data: it’s crucial to understand how Google and Facebook are entirely different in terms of structure. Where Google is vertically integrated (Hardware/Android > Chrome/Play Store > Search Engine/Search Ads), Facebook primarily relies on its strong brands who benefit from stickiness (Facebook, Instagram, WhatsApp, Messenger, Oculus). While this played out well for Facebook so far. As soon as Apple tied up the distribution pipeline, it threatened the whole business!
• Stalled user growth of Facebook: too much pressure with new social media platforms
• The move into the Metaverse becomes a survival anchor for Facebook: where Google’s growth potential has not been affected so far (it might come in the future), Facebook’s growth has already been affected. Thus, the move to the Metaverse for Facebook is not just a strategic bet; it’s a survival anchor! This means Facebook has to rush into it! Blitzscale the adoption of VR devices, which might turn into enormous mistakes.

Who might benefit? Let’s draw some key points:

• Accelerating VR adoption for Facebook: Facebook has to push into VR (Oculus is a first step there). But the vision of Facebook of VR is way more pervading than any other company as its survival depends on that.
• VR/AR wars coming in 2022: all tech giants are rushing into VR with different philosophies. Apple believes in augmented reality, Google believes in mixed reality. Facebook wants to bring us into the Matrix. Therefore, we’ll see the first VR headsets probably in 2022 as the first exploration toward AR.
• Contextual advertising might win over targeted ads based on tracking: digital platforms that go back to contextual advertising rather than aggressive targeting might benefit in this phase (Reddit over Facebook).
• Rise of privacy first search engines and social media: companies whose business model has privacy built-in will keep their growth trajectory. Thus, search engines like DuckDuckGo might skyrocket, and social media platforms like MeWe might thrive.