The Future Of Advertising Is Coming: Here's What You Need To Know

The Future of AdvertisingThe Future of Advertising

Advertising, like all forms of media, is being profoundly changed by Internet and mobile technology.In fact, the transformation to online from offline is arguably more complicated for advertising, because it affects both the advertising itself and the media it’s attached to.

In the last decade, that allowed Google to grow from a tiny search startup to the world’s biggest online advertising company, with $28 billion in advertising revenue last year. These days, it’s fueling new companies with new ad models, such as Groupon.

For our special report on the Future of Advertising, we’ve taken a look at some of the trends and technologies that will shape advertising in the years to come.

The backdrop: The continued shift to online from offline

Think of all the time you spend in front of the computer. Then realise that just 15% of U.S. advertising spending is online.

As more media consumption moves to online, more advertising will, too.

And as televisions become Internet terminals, there is significant room for advertising disruption there.

Ad purchasing will be increasingly automated

Today's online ad technology sounds more Wall Street than Madison Avenue.

But that's the trend: Toward automated, real-time auctions for every single ad impression, based on who you are, what the system knows about you, and zillions of other factors.

Data and computer science, all of a sudden, become increasingly important to a field that once was dominated by genius 'Mad Men.'

As these automated systems become widespread, they could change the game -- both in how much ads are worth, and how humans are involved in their sale.

For more, check out our handy guide to today's advertising buzz-words, such as 'demand side platform,' 'real time bidding,' and more.

Ads and content will continue to blur

The fact is that most people ignore most banner ads most of the time. So how to solve that?

Publishers will continue to make advertising more integrated into their content, so people pay more attention, and so they can charge more for it. They'll also continue to try to make ads bigger and more emotional.

Advertisers will continue to make ads that look more like content, ranging from promotional iPhone apps to wacky online videos to paying celebrities to tweet about their products.

Image from Jason Bateman and Will Arnett's 'Prom Date' online ad/video for Orbit gum.

Advertisers are getting to know you (and your friends)

As advertising becomes more automated and driven by data, advertisers will want to collect and access even more data about you and your online activity, so their systems can figure out which ads are best for you to look at. This data is typically anonymized and aggregated, and then analysed for ad purposes.

(It's one of the big reasons Google is so aggressive about moving into social networking, via its new Google+ product -- it wants to make sure Facebook doesn't have a monopoly forever on social data for ad targeting.)

When done right, this can be useful for people and advertisers. When done wrong, it can be creepy.

Ads will find you

The explosion of smartphones, tablets, apps, and mobile advertising is just beginning -- particularly for location-based advertising.

Sure, there's the old, tired cliché of mobile advertising -- that you'll walk past a Starbucks and get a coupon beamed to your phone. But are you really going to go out of your way for 25 cents off a latte?

Bolder location-based ad products are blooming, such as Groupon Now, the company's real-time, location-based deals service. The idea is that you can get a good deal on food or a fun activity someplace right nearby, right now.

Ads might pay for some of your stuff

Amazon's latest, best-selling Kindle is $25 cheaper than its previous one -- because its screensavers have been replaced by sponsorship slots and ads for special offers.

This is a model -- subsidizing products and services with advertising -- that could potentially extend to many personal devices and services, especially tech gadgets.

Would you deal with more ads for a discounted tablet? Or cheaper mobile phone service? Those may be options in the near future.

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