Emerging AdTech Trends in APAC

Emerging AdTech Trends in APAC

Retail Tech Insights | Tuesday, March 21, 2023

The AdTech market in Asia-Pacific is expected to grow due to heavy usage of AI, ML, Interactive ads, social commerce and data analytics.

FREMONT, CA: The retail tech industry has undergone a significant change during the pandemic. Businesses in the industry need to adapt to evolving customer shopping habits continuously. AdTech, which is the subsector of retail tech is particularly important and is currently valued at USD 886.19 billion.  It is expected to grow at a compound annual growth rate (CAGR) of 13.7 per cent from 2023 to 2030. AdTech is experiencing a significant surge due to the increasing digital ad spending. However, several other factors also play a crucial role in its growth, including:

Increasing Adaptin of Digital Advertising

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The acceptance of digital advertising is a major driving factor for the AdTech market in the Asia-Pacific (APAC) region. With a large and expanding population of internet and smartphone users, digital advertising has become a crucial tool for companies to reach their target market. Social media platforms like Facebook, Instagram, and WeChat are widely used in Asia and provide an ideal platform for targeted advertising by retail tech start-ups. It is projected that digital advertising will reach USD 338.40 billion in the APAC region by 2027, growing at a rate of 9.26  per cent from 2023 to 2027.

E-Commerce Growth

The pandemic has caused a surge in the growth of e-commerce due to limitations on physical store visits and an increase in people staying at home. This has resulted in more individuals turning to online shopping, especially tech-savvy younger consumers who are becoming more comfortable with this method. In addition, the improvement in logistics and supply chain infrastructure, along with the increasing popularity of digital payments, has made it easier for companies to sell and deliver their products to even the most remote areas, thereby contributing to the growth of e-commerce in Asia.

Programmatic Advertising Adoption

Programmatic advertising contributes to the AdTech industry's growth in the APAC region. Programmatic advertising refers to the automated purchasing and placement of digital ads. It is becoming increasingly popular among businesses as a way to reach their target audience with relevant ads and get the most out of their advertising budget. The cost-effectiveness and efficiency of programmatic advertising have made it an attractive option for businesses of all sizes in Asia.

Increased Awareness Of Data-Driven Advertising

The pandemic expedited the transition towards online and digital channels for advertising, which created a necessity for businesses to utilise data to comprehend evolving customer behaviour and preferences promptly. Furthermore, advancements in data analysis and artificial intelligence technologies have made it more accessible for companies to examine and employ this data to focus their advertising more precisely

Rise Of Artificial Intelligence (AI) And Machine Learning (ML)

Artificial intelligence and machine learning are revolutionising various industries including AdTech. ML is being used to customise the content of different target audiences and improve personalisation. AI-powered tools, such as robotic automation, can automate up to 45 per cent of the repetitive task for AdTech startups. Additionally, 84 per cent of senior executives view algorithm-based technology as essential for their company's growth.

Interactive Advertising

Interactive ads allow viewers to actively engage with a brand, encouraging them to take an action to reveal something or navigate to a landing page. This type of advertising increases engagement by urging the audience to physically interact with some aspects of the advertisement, transforming it from a passive experience into an activity. As a result, it is likely to generate more interest and compel viewers to learn more about the company on its website. For instance, research has shown that interactive video ads can increase the time spent with a marketing message by 47 per cent compared to non-interactive advertisements.

Increase Demand For Social Commerce

Social commerce is a combination of social media and E-commerce. It leverages individuals’ eagerness for products they see on social media and aims to satisfy their wishes quickly. Additionally, social commerce provides a more interactive experience compared to traditional E-commerce, and the shareability features on social media platforms turn shopping into a social activity. Social media is a critical channel for sales if a company's target audience is between the ages of 18 and 35.

Data And Analytics In Advertising

As companies increasingly adopt AI and ML technologies, data analytics is becoming more crucial for businesses to leverage data insights and algorithms to automatically deliver ads to the most appropriate user, at the most opportune moment, on the most suitable platform, and at the optimal price. By gaining a deeper understanding of the data obtained through digital advertisements, companies can gain valuable insights into their audience and customise their ads to reach the right target audience.

The AdTech market in the Asia-Pacific region is expected to experience significant growth in the near future. The growth is expected to be driven by various factors such as the rising use of AI and ML, the popularity of interactive ads, the increasing demand for social commerce, and the growing importance of data analytics.

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