Advertising Dollars Still Concentrated in the US and AsiaPacific

Ad spending in the US and AsiaPacific lead the world, yet in spite of that they are expected to to contribute more to this year’s expected ad spending growth.  The biggest growth in AsiaPacific comes from all the highly populated countries outside of China, Japan and South Korea – India especially.  Exxpected growth in Eastern and Western Europe and Latin America will account for less aggregate growth than the US.  Source: The Drum

In China, 2018 Ad Spending Suggests 2019’s Trend

China’s ad spend for 2019 is projected to increase by 7%.  For a clue as to where that spending will go we have data from where it went last year.  2018 saw digital spending increase at the cost of all other mediums. Like the US, it was newspapers that gave up the most revenue in service to the digital spending trend.

Global CEO & chairman of Dentsu Aegis Network, Tim Andree, commented, “Digital connectedness – driven not only by advances in technology, but the speed of consumer adoption – has fundamentally changed the shape of our business and will continue to do so.”  Source: The Drum

The Future of US Digital Regulation

Reporting from the first nine months of GDPR provides a look into the future of US regulation. The ability to focus user issues in one agency for 31 countries gives an insight into the breathe of the problem, which is likely to be similar in the US.

Notably, the number of data breaches reported in the first month of GDPR regs was 1,700 – referred to a “massive increase” from prior periods. The monthly number has settled down to about 400.

As we reported previously, regulation in the US is moving state by state rather than from the feds, which will make it harder to suss out an insight into trends, into the progress we are making against privacy violations.  Source: The Register; European Data Protection Board

AI as the Next Great Cyber Threat

The invention of controlled fire was a turning point for humanity. To that point fire was mostly a bad thing. Once controlled, man could make a ribeye and fire became a good thing.

The early history of AI has dwelled on the positive – how it could deliver better medical diagnosis or, in our world, how it could help find the right audience or create more specifically relatable messages. It can help us sell more stuff. Great!

But, like fire, the good side implies a bad side that we haven’t talked about much. AI’s bad side: When the bad guys start applying the same machine learning tricks we are using for benign marketing purposes to their stolen databases, our cyber security problems will multiply dramatically. Phishing emails will become even more alluring. They will arrive on your screen at your most vulnerable.

All of which leads to the inevitable good verses evil battle. When the force of evil AI  becomes apparent, it will force an AI defense response to counter it. And the escalating battle will be engaged.   Source: SiliconANGLE

Eyes on the Chinese Consumer

Will Chinese consumers fold under the pressure? That’s today’s question for the world economy. It results from the successful adjustments made by the Chinese government to turn its economy toward the consumer, which now accounts for 78% of its economy. These days, if the Chinese consumer stops buying it will affect the world.

To keep spending moving the government has loosened credit and reduced taxes to put more money in worker’s pockets. And the job market seems to be holding as well. With the exception of some manufacturing sector losses, independent surveys indicate that the job market remains strong.  Source: Seeking Alpha

The Regs are Coming

Government regulation is the newest and most consequential moving part in today’s digital advertising space. As we’ve commented before, GDPR has been the driver toward regulation in the world. In the US, the gauntlet has been picked up by California and at least ten other states, which are implementing various levels of digital regulation. Therein lies the problem and the reason the IAB, in a change from its historic position in favor of self-regulation, is seeking federal regulation to standardize the approach.

In a letter to the Senate Commerce Committee, IAB wrote, “A uniform federal privacy standard could provide clarity, market certainty and add fuel to future innovation while preserving the value and benefit that online advertising brings to the internet ecosystem.”

There will be more regulation. The question is, will it take a fractured, multi-state form or will it be a more uniform, coherent form from the feds?   Source: AdExchange

Read the Footnotes

At this writing, there appears to be a coming breakthrough in the trade negotiations with China. Of course the devil is in the details, but any end to the disruptive trade tensions would add some stability to the world’s economy.

Most important to Western technology businesses is the promise that this agreement will do something to correct the intellectual property rights issues that have long plagued us. We will be anxious to see to what extent joint ownership rules will be adjusted and patent integrity will be protected. Our recommendation: read the footnotes on any agreement.  Source: BidWin analysis

Mobile Forever

These numbers paint a picture of mobile’s unquestioned dominance in our lives today and into the foreseeable future. We can guess that the growth areas will come from increased use of smart assistants and speakers. As for millennials and those who follow them, expect the growth of evolutionary appendages that will make thumbing easier.  Source:

Digital Ad Spend to Overtake Traditional this Year

The cornerstone of digital’s expected growth in 2019 will continue to be mobile, which is projected to account for more than two thirds of the its total, about $87.1 billion. For every winner there has to be a loser. In the case of ad spending, it’s traditional media with print taking the biggest hit, expected to be down 18% while TV is expected to be down 2.2.%. The print number suggests more trouble for newspapers and magazines.  Source: eMarketer

Concerns about Chinese Consumers are Overblown

Keeping a close watch on the Chinese consumer is the main pastime of economists these days. Since trade pressures have had a measurable effect on the manufacturing sector of the Chinese economy, it is natural to watch the effect they’re having on the other side, the consumer.

Based on the year-over-year expenditures-per-capita increase of 14.8% in 2018 compared to 2017, it seems that consumers are holding up pretty well. The only area of steep purchasing decline was seen in the automobile sector. Balancing against the auto decline are the dramatic expenditure increases in service categories like healthcare, leisure and travel healthcare expenditures.

Tianjie He, senior economist at Oxford Economics, wrote in January, “The fact that retail sales excluding cars (have) held up well and consumer confidence has also improved indicate that concerns about China’s consumers are largely overdone.”  Source: CNBC