Is the digital world as we know it about to end?

From the end of the duopoly to the rise of synthetic media, UM's annual media outlook sees signs that foundational change is approaching.

UM has isolated four key trends in its annual outlook on the media landscape for the years ahead, and it seems like some of the biggest pillars of the digital landscape may be beginning to crack.

“With so much change over the last few years, it has become increasingly clear that the digital world as we knew it is coming to an end, and we’re currently in suspension between what has worked and what will work,” says Kelvin Mak, senior director of digital strategy and partnerships for UM Canada and a contributor to the report. “A host of macro driving forces, from geopolitical to cultural, have come together to shift the way consumers approach technology and, consequently, how they interact with brands. This next year will be formational as brands, industries, and society find new paths forward.”

The first trend the agency sees is the end of the digital media duopoly with Google and Meta loosening their grip on the ad industry due in part to changing consumer and government sentiment towards the two tech giants, which in Canada is reflected by regulations like Bill C-11 and C-18. But there has also been an increase in new channels for consumer discovery and purchase, whether it is social platforms like TikTok or new mediums like retail media or ad-supported streaming, where the two companies are less able to exert their control.

“What this development signals is an increased consciousness to protect Canadian interests and identity, and serves as a pushback to tech giants that have been generating profits from local content,” the UM Canada team wrote in its own report that dove into the Canadian ramifications of the global trends. “While the repercussions of these bills, should they become law, affect not only Meta and Google, but it’s also likely that they will be impacted the most given where they are in their maturity cycle, and their reliance on broad swathes of content to keep users engaged.”

This trend also ties into a greater focus on privacy, and the “privacy-safe” nature of first party data used in retail media is a reflection of this. However, this means digital advertising is likely to fragment more than before and new approaches with respect to diversification and risk management will be needed to tackle the strategic and measurement ramifications.

The second trend is what UM calls “Twenty-Twenty Me,” referring to the “What’s in it for me?” consumer sentiment. Current cultural conversation encourages consumers to build and showcase self-identity. Matching that up with the omnipresent algorithms designed to serve every taste shows that we are entering a time of hyper-individualism and creatorship.

This is an evolution from a trend in last year’s report that was focused on the idea of “us”. UM now says 2023 is about “me,” whether it’s further personalization or using data to help build “virtual street cred,” brands need to be part of the journey to help audiences tell their own stories.

The third theme – the rise of synthetic media – should be no surprise with all the talk around artificial intelligence. ChatGPT is only one of the many AI-based tools being quickly made available for mass consumer adoption. Although the industry is only in the beginning stages of synthetic media’s introduction into popular culture and advertising, brands have to be aware of regulatory restrictions, the need for human oversight, and to understand the best use cases for AI to personalize and scale consumer interactions.

“There are also laws in Canada that have been created to protect consumers’ privacy,” the UM Canada team writes. “The most notable one being Bill C-27, the Digital Charter Implementation Act, which contains new legislation relating to privacy, data, and most importantly AI systems in Canada. If passed, there would be regulations placed about AI usage, coming with penalties for noncompliance. However, the reality is that technology moves faster than legislation, and the rapid development of AI-powered tools will likely outpace regulatory frameworks.”

The final theme is the return to “kitchen table internet.” UM says that with all this innovation and fragmentation, in addition to the anticipated economic downturn, organizations are laying off significant numbers of their workforce. That means there’s a lot of talent in the market. While bigger companies are focused on protecting their bottom line over growth, the agency believes the current landscape will favour those who prioritize innovation, especially within smaller or mid-sized organizations that can remain agile in their operations.

“Additionally, less demand for tech roles within the multinational big players in Canada could also be beneficial as it allows for greater local talent retention,” UM writes. “This is a major advantage as it could increase Canadian-owned and operated businesses and startups, spark innovation in existing and emerging markets, and more importantly, present new opportunities to address local demands with the agility of a smaller organization.”

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