Content, experiential and AI are the future of advertising

The Lego Movie is a brilliant example of an ad masquerading as entertainment, says Arshan Saha

There's been a lot of skepticism about the future of advertising. For most of the past decade, digital advertising has advanced considerably, with major corporations spending a majority of their marketing budgets trying to increase their online visibility. And with this, one of the main challenges facing marketers is breaking through the clutter to reach their target audience.

However, the rise of obtrusive and irrelevant ads on the web has led to a backlash in public opinion and an increase of ad-blocking software. In response, some of advertising’s biggest spenders have started to shift their focus towards other avenues such as experiential marketing - a strategy that focuses on creating a physical experience for consumers. This leaves advertising at a tricky crossroad, and got me thinking: Will advertising always remain an important part in a company’s marketing strategy? And as an advertising company, how can and should advertising adapt if we believe it to be the way forward?

As with any industry, advertising isn’t perfect, and it will never be. Advertisers are always trying to come out with some outcome or another: increase in sales, improving awareness, or increased brand recognition. From a Xaxis’ perspective, we evolved our business model to deliver more measurable value to clients. The best way to do this was to understand the client’s advertising goal that ties as closely as possible to the true business outcomes they are trying to drive. So what do marketers need to think about and do differently to truly engage consumers and drive measurable business results?

With the advancement of technology, artificial intelligence (AI) has changed what we can achieve, how we can achieve it, and the metrics used to define success. Advertising will continue to adapt and we’ve taken this in stride by placing AI and machine learning at the core of our work to optimize against our clients’ specific campaign goals. The increasing use of AI has allowed us to integrate more data and intelligence into every action than ever before, enabling us to create a completely customized experience tailored to each person’s own preferences and purchasing behaviors, match our clients’ brands with the most interested audiences, and continually optimize campaigns to deliver better results in less time.

While it is true that consumers hate interruption, advertisers are now starting to create content that consumers enjoy. For example, a new form of creative ad has emerged in China which plays in between breaks while users stream TV dramas. These ads follow original content and narrative arcs, and feature the same actors in their on-screen costumes, becoming almost indistinguishable from the original content for the first few seconds-long enough to hold the audience's attention and pique their interests. This type of advertising is expected to surpass 2 billion yuan (US$311m) in sales revenue this year, up from 800 million yuan in 2016. The Lego Movie is another obvious yet brilliant example of an ad masquerading as entertainment that people pay to see. Content needs to be legitimately entertaining to engage consumers, but advertising itself won’t disappear.

At the end of the day, approaches such as experiential marketing can be a highly valuable way for many companies to gain brand exposure and customer loyalty. But, they shouldn’t necessarily replace advertising altogether. Marketers need to focus on reaching business objectives and quantify success with real metrics and conversions (whatever marketing tactics they deploy). That means connecting with customers holistically, wherever they happen to be – and as we all know, people are spending more time online now than ever.

For Xaxis, repositioning our offering to focus on client outcomes was the most logical option if we want to stay relevant and add continued value. Aligning with a client’s true marketing and business objectives and creating a digital campaign that delivers results to hit those objectives and maximize return on advertising spend is proving to be very much the way forward for many of our clients, as evidenced by many of our campaigns which meet and often exceed their business goals. We will continue to evolve our advertising solutions to drive towards the results brands and consumers want; that, we believe is the way forward.

Arshan Saha is president of Xaxis Apac

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