How can a brand take advantage of the 5G revolution today?
Actually, that’s a trick question.
The next evolution of wireless technology after 4G LTE, 5G-enabled devices won’t be available until at least 2020, despite limited test deployments in large cities and a fair amount of boasting from the big telecom companies.
But what will 5G bring when it comes, and what do marketers need to know to prepare?
Each generation of mobile communications has changed the way people consume media: 2G made it possible to send texts, 3G gave us the internet in our pockets and 4G gave us video everywhere. The advent of 5G has the potential to alter consumer behavior, increase the volume of accessible data, create new inventory sources and transform the media plan.
Here are six ways 5G will change marketing and advertising.
Faster data collection
5G promises to be between 10 times and 1,000 times faster than 4G – depending on who you ask – and to provide a major reduction in latency that, if the technology’s cheerleaders are to be believed, will allow nearly any device with a chip to be perpetually connected to a blazingly fast network without Wi-Fi.
That speed would let marketers collect, analyze and activate data in the moment – the sort of thing most vendors like to promise today, but rarely are able to deliver.
Imagine, for example, being able to instantly swap ads in real-time based on the demographic and behavioral profiles of the people milling in front of a digital billboard, said Ömer Barbaros Yiş, EVP of marketing at Turkish telco Turkcell, which ran its first 5G trial in late 2018.
“You could really change the ad dynamically in seconds so that it’s more contextual and relevant to the customers who are there right then,” Yiş said.
And if TVs, laptops, phones – and even billboards – are running on the same 5G network, attribution solutions could get closer to closing the elusive loop by enabling advertisers to more easily track consumers as they go about their days. It might actually become quite difficult to truly disconnect in a 5G world.
Resolving identity will become easier
But the real impact, said Todd Parsons, chief product officer at OpenX, will be on identity solution providers who will have access to new data points they can theoretically piece together.
Along with an influx of internet-connected devices – 20.4 billion are set to be online by 2020, according to Gartner – comes the availability of biometric data, gesture data, ambient data and even more geolocation data, all of which could be used to improve the larger advertising experience, Parsons said.
“4G helped make apps like Uber and Google Maps a success and, in the process, changed how advertisers started to think about location data,” he said. “This will likely happen in some fashion with 5G, too.”
This data will “definitely” make its way into the open ecosystem, Parsons said, just don’t forget about privacy in all the excitement. The same rules apply: Identity-based advertising needs to be permission based and new applications should be designed with a privacy mindset.
New ad formats will emerge
But what types of ads are marketers going to serve in this brave new 5G world?
Everyone agrees that 5G is going to usher in the appearance of new and interesting ad inventory … (Maybe more AR? Cooler rich media? As-yet-unforeseen voice applications?) they just don’t know exactly what it’s going to look like.
According to a recent poll conducted by Verizon Media, 47% of advertisers cite the opportunity to use new or additional creative formats as a top benefit that will arise from 5G.
Clearly, digital video ads and dynamic video creative will mature and increase commensurate with faster download and streaming speeds. People will consume more video on their phones, which will lead to more video inventory to meet demand. Assuming 5G phones render in high definition, advertisers will also have to make sure they shoot high-quality vids so that they don’t look crappy or cheap in HD, said Jack Smith, chief product officer at GroupM.
Beyond that, though, it’s anyone’s guess, although it’s likely than an early use case will come through in-store, augmented reality-infused experiences, like trying on clothing virtually.
“It’s pretty difficult for most marketers to think about the new kinds of inventory until they can get their hands on test devices,” Smith said. “We can speculate as much as we want, but first we need to start playing with it and see what it’s really like.”
But it’s not going to just be more of the same, said Matt Van Houten, a VP at Xandr, AT&T’s advertising and analytics division
“Progressive companies today are talking about a six-second spot – okay, but with 5G there’s the opportunity to create new, more immersive ad units,” Van Houten said. “Imagine a media plan where you’re buying digital out-of-home, smart TV inventory – smart car inventory.”
Advertising in smart cars might be a little premature, but at least content, including ads, will load more quickly, which should mean lower bounce rates and maybe even a reduced need for ad blockers.
But speed isn’t a panacea to fix a poor user experience, said Andre Swanston, CEO and founder of OTT data provider Tru Optik.
“If you’re terrible at mobile advertising, 5G isn’t going to fix that for you all of a sudden,” Swanston said. “You’ll just be making a bad experience faster.”
Vendors will need to update their infrastructure
The move from 3G to 4G unlocked real-time bidding, but the shift to 5G will require ad tech companies to update their infrastructure to be more flexible and accommodate far snappier ad serving, speedier audience reconciliation and way more programmatic transactions.
“We’re living in a biddable environment, and 5G could be a way to really enhance the speed of how the marketplace works,” said Jeff Lucas, head of North American sales and global solutions at Verizon Media.
But 5G experiences won’t work if they run on 3G or 4G technology, Parsons said, and most of the infrastructure that exists today “is not up to par with what will be required.”
Although 5G is still just a millimeter wave on the horizon, the programmatic industry is already starting to get ready. Earlier this year, for example, OpenX transitioned its exchange to Google Cloud, a move that wasn’t completely motivated by 5G, but will help the company be more nimble with its data processing when 5G ups the ante, Parsons said.
And agencies will be looking for their ad tech partners to be prepared. “If latency goes from 40 milliseconds down to 10 or 6 milliseconds, we’re definitely going to have to make sure that all of the technology provided by our third-party vendors is keeping up,” GroupM’s Smith said.
But agencies will also be keeping an eye on the fees.
“We understand that infrastructure costs will go up for the tech providers,” Smith said, “but we’re also going to be careful that they manage that correctly and that it stays a low percentage of the overall marketing spend.”
An influx of content platforms
For their part, telcos are still figuring out what exactly will be the big money maker for them with 5G, but one potential is the concept of network slicing, in which a carrier can parcel out third-party access to a small portion of its network.
An esports company or streaming provider, for example, could buy a certain amount of bandwidth and run as a virtual end-to-end network, which helps with speed and storage.
“We’re not just talking about Netflix, though, but potentially brand-new opportunities,” said Bill Menezes, a principal research analyst at Gartner. “If you’re a media planner, you could suddenly have whole new outlets that you need to work with.”
There will be new privacy and security issues
With so many new devices set to come online, everything from internet-connected fridges to IoT dog collars, privacy and security have got to stay top of mind.
Not only is every internet-connected device a potential data breach waiting to happen – most don’t have security chips, run traditional security software or even have a user interface – there will be tons of data flowing in from the sensors nested within those devices.
“You will easily be able to describe me just by looking at my digital footprint,” said Turkcell’s Yiş. “The more data there is, the more we have to be sure to talk about the privacy issue.”
It’s not here yet
But it’s worth taking a step back. A lot of what you hear about 5G – smart cities, smart homes, truly autonomous vehicles, remote medicine – is pure fantasy, at least for now.
“At this point, the telcos will probably tell you that 5G will slice and butter your toast for you,” said Gartner’s Menezes.
Tru Optik’s Swanston has your reality check: “Just be reasonable about how bad the United States has been at rolling out all kinds of telecom infrastructure – some places in the United States have to use satellite, because they still don’t even have access to broadband cable. It’s 2019 and some people’s cell phone service is stuck in 1995. There are at least 10 dead spots between where I live in the suburbs of Connecticut and New York City.”