2023 Ad Revenue Forecast: Ad-Apocalypse or Ad-Haven?

Ad Exchange Ad Optimization
January 20, 2023 | by aleesha
how-low-ad-revenue-go

The advertising industry is currently facing one of its toughest challenges in recent years, with ad revenue plummeting to its lowest levels in the last five years. In fact, the revenue numbers are even worse than the lowest recorded during the peak of the pandemic restrictions.

This spooky situation has raised serious concerns among ad-tech industry experts, and publishers are scrambling to find ways to stay afloat in this AdOps Recession. The question on everyone’s mind is, what has caused this sharp decline in ad revenue, and how can it be reversed?

Let’s delve deeper into this below!

Historical analysis reveals that ad revenue will continue to dip for the first half of 2023

Historical analysis has shown a clear pattern of ad revenue fluctuations over time. While there have been periods of growth, there have also been times of decline. Unfortunately, the current trend indicates that ad revenue will continue to decrease for the first half of 2023. This is a cause for concern for many businesses, as programmatic advertising is crucial to their ad revenue generation and growth strategies.

The reasons behind this trend are multifaceted and complex. The ongoing impact of the Russia-Ukraine war, inflation, recession, etc, has greatly affected the economy and consumer spending, leading to a decrease in advertising budgets for many companies.

In addition, the shift towards digital channels and the rise of ad-blocking technology have also affected the industry. Businesses find it increasingly difficult to reach and engage consumers through traditional advertising. Furthermore, the increased competition and saturation of digital advertising space have led to a decline in the effectiveness of online advertising.

AdTech Industry Outlook

The decline in publisher ad revenue has been a worrying trend over the latter half of 2022, with month-over-month drops becoming increasingly prevalent. This trend is a reflection of the broader economic climate, as 2022 was a challenging year for the economy as a whole.

However, while the current situation may be dire, it’s important to note that this trend is not unique to the publishing industry. In fact, many other industries have been similarly affected by the economic slowdown.

Despite this, there are reasons to be optimistic about the future. Our AdOps experts predict that the economy will begin to recover in the second half of 2023. As a result, ad spending is also expected to pick up, providing a much-needed boost to the publishing industry.

Furthermore, the industry is also adapting to the new trends and technologies that are emerging, such as programmatic advertising, native advertising, OTT advertising, and personalization. These new trends will open new opportunities for publishers to monetize their content and increase their ad revenue.

Additionally, publishers will focus on building more meaningful relationships with their audience by delivering more personalized and relevant content. As a result, this will lead to increased engagement and higher ad revenues.

In the second half of 2023, AdOps experts expect ad revenue numbers to go back up

Industry experts believe that there’s hope on the horizon, with a resurgence in ad revenue expected to come from the third quarter.

As businesses start adjusting to inflation, they will start to increase their advertising budgets, leading to an increase in ad spend. This, in turn, will result in more ad revenue for publishers.

Over-the-top (OTT) advertising is another area that is expected to grow in the second half of 2023.

As more and more people consume video content online, OTT advertising will become an increasingly attractive option for brands looking to reach their target audiences.

This is good news for publishers, as it will provide them with new opportunities to monetize their video content.

The demand for native advertising is also expected to increase in the second half of 2023.

Native advertising is a form of advertising that is designed to blend seamlessly with the surrounding content, making it less intrusive and more effective.

As more brands realize the benefits of native advertising, they will start to allocate more of their budgets to this type of advertising, leading to an increase in ad revenue for publishers.

The emergence of new advertising platforms and technologies such as Virtual and Augmented Reality will also play a role in the ad revenue recovery. Brands will start experimenting with these technologies in their ad campaigns, which will result in more ad revenue for the publishers.

Personalized advertising is another trend that is expected to drive ad revenue recovery in the second half of 2023. As consumers become more and more accustomed to seeing personalized ads, they will start to respond more positively to them, leading to an increase in ad revenue for publishers.

Transparency and brand safety will become even more important in the second half of 2023. Brands will be more vigilant about where their ads are placed and will want to ensure that their ads are not associated with any controversial or unsafe content. This will lead to an increase in ad revenue for publishers that can demonstrate a commitment to transparency and brand safety.

Finally, audio and voice advertising are expected to grow in popularity in the second half of 2023. As more and more people adopt smart speakers and other voice-enabled devices, audio and voice advertising will become an increasingly attractive option for brands looking to reach their target audiences. This will provide new opportunities for publishers to monetize their audio content, leading to an increase in ad revenue.

What to do, then?

PubGuru Unified Pricing Rules report

In conclusion, while the current situation may be challenging for publishers, it is important to remember that MonetizeMore is here to save you regardless of inflation or recession.

Regardless of the type of ad monetization solution or demand source you use, get ready for a tough first half of 2023. You are not the only business that is getting affected here.

Your revenue will be rollin’ back up as long as we have your back. If you aren’t already with us, then sign up here.

FAQ

How Low is Ad Revenue Right Now?

As of Jan 2023, ad revenue earnings are at the lowest level in the last 5 years, lower even than the low point presented during the height of COVID-related restrictions, and pretty much the same as in the first quarter of 2019.

How was Q4 2022’s performance compared to Q4 21’s performance?

Q4 ‘22’s revenue numbers were 30% lower than Q4 ‘21’s revenue numbers due to inflation and advertisers spending less. However, it's important to note that this trend is not just limited to the publishing industry, many other industries have been similarly affected by the economic slowdown.

 

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