Digital Advertising: 25 Years Old and Already the Most Dominant Force in Advertising
Twenty-five years ago, the world was flooded with pogs, flannel shirts, video rental stores, macarenas, and a sitcom about a group of friends living in an outlandishly large NYC apartment. It was also the year that launched a couple of startups called Amazon and Yahoo! and gave birth to a seemingly innocuous computer graphic that would soon become known as the banner ad.
That seemingly insignificant ad was the start of something groundbreaking.
It was 1994 — the beginning of digital advertising. Now, digital is the most dominant force in the advertising universe, and it’s only picking up speed. By 2020, digital will account for around 40 percent of all global advertising, and, by 2021, digital is expected to overtake all other traditional advertising mediums.
The early days
That first banner ad — a colorful, unbranded callout from AT&T driving people to click — flickered to life on an early webpage. Two years later, Yahoo! launched the search ads, and in 1997, pop-up ads began aggravating web users. From then on it is a story of constant evolution — from search advertising keyword auctions to Google AdWords to in-app and social ads.
For 25 years, the digital advertising industry has been evolving and transforming through lots of trial, lots of error, and remarkable creativity and innovation. Together, those forces led the industry to where it is today — and to an understanding of the opportunity and technology to deliver unparalleled customer experiences.
That first banner ad was the beginning of something big. A huge portion of viewers clicked on this novel rectangular graphic — 44 percent by most accounts, though some claim up to 70 percent. And as internet users became accustomed to and started to ignore banners, advertisers followed suit by accelerating their creativity and growth with more eye-catching graphics and in-your-face tactics.
Serving ads on a large scale
Within a year of that first banner, the industry truly began to change. DoubleClick — a company that used servers to disseminate ads — launched in 1995 and enabled advertisers to mount large-scale campaigns instead of placing one-off ads on individual sites.
This was the start of marketing automation — and kicked off unparalleled momentum. DoubleClick was followed by the advent of search advertising and Google AdWords. These tools helped digital advertising scale and internet-based ad revenue tripled every year — from $100 million in 1995, to $315 million in 1996, to $991 million in 1997.
Soon advertisers began focusing on analytics and measurement to justify ad spending, and that became even easier to track with the introduction of social sharing sites. Video and social media platforms — including YouTube and Facebook — changed online advertising profoundly. Advertisers were able to integrate brand messaging seamlessly with the audience’s organic online socializing. It became a two-way street, as viewers began interacting more intimately with brand messages, while brands began personalizing messages for their audiences.
Adobe, proud to be part of digital advertising
This was just the beginning — for the industry and for Adobe. Since day one, we’ve been committed to helping people create and businesses compete.
Our flagship products, Adobe Illustrator, Photoshop, and Premiere Pro were already on the market when digital advertising was born — with After Effects released soon after. They were the perfect match for the burgeoning industry to bring creative visions and messaging to life.
In the 2000s, as digital advertising evolved, we expanded to offer a suite of ad management, delivery, and measurement solutions. And to further empower customers, we brought on capabilities for digital photo software, business process management software, and 3D collaborative software.
Our largest and most game-changing addition of was Omniture, a web analytics firm. This was a major step forward for Adobe Analytics and our future data-driven solutions. Web analytics has become the engine behind online marketing — allowing companies to target their messages to their audiences and driving customer engagement and loyalty.
In 2016, we launched Adobe Advertising Cloud — an independent platform to manage the entire ad campaigns. As digital advertising evolves, we continue to find new ways to help our customers build amazing connected omnichannel experience everywhere, and embrace today’s marketing technology to more effectively reach audiences and meet business goals.
The next 25: Where we’re going
Digital advertising is now at a crossroads. Innovation seems boundless as the industry is embracing and redefining itself with new technology like artificial intelligence (AI), augmented reality, virtual reality, and more. Now, the new “normal” is for brands to be customer-centric, delivering connected advertising experiences to diverse customers across every device and platform.
It’s all deeply data-driven and deeply personalized to the customer — customers who, more than ever, are privy to greater experiences anchored in more relevant content, creative, and opportunities than ever.
At the same time, the industry is working through some serious growing pains. Digital ad fraud is constantly growing and predicted to cost over-the-top (OTT) video advertisers up to $10 billion annually by 2020.
In addition, social platforms’ inability to control what is shared on their sites is fueling advertiser concerns about their brand surrounded by questionable content. AT&T and Verizon, for example, recently froze display spending on both Google and YouTube after their ads were intermingled with objectionable content.
With a sense that digital ad content is increasingly lawless and uncontrollable, publishers are reacting by walling off their own spaces and working with advertisers individually. The move, no doubt, frustrated advertisers who now have to deal with logistical burdens to bring quality advertising to a wide audience.
Continuing down this path leads to more consumer distrust, privacy concerns, and walled data gardens. But there’s another path, one that mixes respect for consumer data with ad-tech processes and design to create value for everyone — consumers, advertisers, technology providers, media networks, and publishers.
Global businesses are discovering that customer experience is a mission-critical part of their success. In the modern digital advertising landscape, advertisers must strive to better understand their audiences. They must also unite disparate data and inventory solutions, and invest in an omnichannel strategy instead of siloing investments by media channel.
Adobe and the future of digital advertising
Here at Adobe, we’re absolutely dedicated to the future of digital advertising. We understand that the future is becoming increasingly complex. In the next 25 years, we’re taking on these complicated challenges with easy-to-use solutions that will drive meaningful and connected digital advertising experiences to the right audiences.
We believe that the best way to handle an industry that is changing at a breakneck pace is to be part of that change and consistently push the boundaries of what is possible.
It’s our technology and creativity that will help shape digital advertising and even as the future changes and new platforms emerge — like voice-based devices, IoT devices, and alternate realities — we will continue to put customers at the center.
Let’s continue our journey to the past and find out even more about the future.