Market Intelligence | Technology Trends to Watch for 2023

Tech creating value through connected devices for commerce, Web3 for loyalty programs, Clean Room for interoperability, and AI for dynamic creatives.

Key Takeaways

The tech industry lost some wind in 2022, ending the year with layoffs, shrinking market value, and a few epic collapses (like FTX). The hype around many technologies—such as Web3 and internet of things (IoT)—fell short of reality. These technologies all have real value, however, and brands will use 2023 to tap into their potential.

We share insights on connected devices getting ready for commerce, generative AI transforming dynamic creatives, clean rooms becoming more interoperable, and Web3 innovating loyalty programs.

Connected Devices Get Ready for Commerce

Ubiquitous IoT will open doors for commerce.

Smart TVs, connected homes, and connected cars not only have proliferated, but each is also independently experiencing catalysts that will make them easier to use and more responsive in 2023. With seamless connections in new contexts, new forms of commerce should follow:

Smart home IoT gets integrated. Matter, the long-awaited common standard, went live in October. Users can now integrate devices and tie them to virtual assistants, opening new paths to ecommerce.

Embedded car systems make payments easier. As embedded operating systems become more common, commerce will spread beyond the early partnerships that focused on car-related payments, such as parking or gas, to other types of commerce.

Click-to-buy comes to your TV. The integration of virtual assistants will make it easier to create new connected TV (CTV) advertising formats and purchasing moments—although full-scale commerce may not evolve immediately.

QR codes and visual search create new mcommerce opportunities. QR codes have become ubiquitous on billboards and digital out-of-home (DOOH) screens as direct conduits to product pages and interactive experiences.

Forecast

Carmakers partner with payment systems. Some partnerships, such as the one between Daimler AG (now Mercedes-Benz Group AG) and Mastercard, already exist, but 2023 will see more agreements.

Shoppable media grows, but serious commerce will take time. An uptick of new direct-response CTV ad formats in 2023 will generate commerce, but it will take some time to change consumer behavior.

Generative AI Will Transform Dynamic Creative

Content Creation

Generative AI leads the charge in AI’s second wave as the newest venture capital darling. Startups are back to high valuations despite economic uncertainty, and improvements in technology are poised to transform how content and creative teams function across industries.

Mainstream adoption in marketing and advertising is happening quickly:

The public release of image models like DALL-E 2 and language products like Copy.ai and Jasper sparked an explosion in generative AI adoption.

The conversation around ethics is evolving in real time. OpenAI struck a deal with Shutterstock to produce AI-generated stock photos, while Getty Images decided to ban it outright.

AI tools help brands create better content at scale, freeing up creatives by saving time on ideation and drafts. And brands are taking advantage of the opportunity this season. Persado estimates that at least 25% of the population interacts with its generative AI content, a figure that could be 35% to 40% when accounting for all companies that use generative AI in marketing copy.

New apps and startups launch every day. Creative product heavyweights Adobe, Canva, and Microsoft will embed generative AI into their product suites.

Forecast

The next unicorn will be a generative AI startup. These companies are retaining high early-stage valuations and, if adoption catches up to hype, 2023 will see higher multiples for valuation earlier than other investment areas.

Your marketing team will adopt generative AI tools if they haven’t already. You will use these tools in 2023.

Clean Rooms Will Become More Interoperable

Data Privacy

Clean rooms went from obscure to must-have. As third-party identifiers became harder to use, advertisers and data owners—such as media, retailers, and credit card companies—turned to clean rooms in 2022 as a privacy-safe way to share data—albeit without fully replacing the capabilities of unfettered third-party data sharing.

Current clean rooms still have limitations:

Interoperability. Many clean rooms have their own protocols for linking identities and use different clouds, which limits their use to larger brands with the bandwidth to deal with multiple systems.

Standards. Clean rooms ingest data in different ways with uneven rules for pairing data and protecting privacy, a leading concern for clients. As privacy regulations evolve, better standards will need to be developed—something the Interactive Advertising Bureau (IAB) is pursuing.

Leakage. Some clean rooms pool data, which has the perceived risk that one company’s first-party data conceivably could lead to insights for a competitor.

Models-based links are gaining traction. Not all brands have access to their customers’ email addresses, so they’ve turned to modeled cohorts of users with desired attributes.

Forecast

Better standards and more interoperability fuel growth. The ability to port data and insights more easily between clean rooms will make them more appealing to smaller brands, publishers, and other data holders.

Clean rooms expand to cover more strategic insights. Brands will increasingly look at clean rooms for insights to help in areas beyond marketing, such as product development and inventory management.

As Hype Subsides, Web3 Gets to Work for Loyalty

Advances in Web3

Hype overshadowed real advances in Web3. Web3 went through a boom-bust cycle in 2022 as cryptocurrencies and nonfungible token (NFT) markets skyrocketed and then collapsed. But the underlying blockchain technologies of Web3 can do a lot more than build speculative currencies. They enable digital assets that are easily activated and controlled by individual consumers.

Web3 can provide benefits for loyalty programs:

Individual ownership of rewards. NFT-based rewards can be traded with others, gain value, or even be used across brands.

New ways to register or activate rewards. Customers can gain points by scanning a QR code from an ad or store, buying a combination of products, completing a game, or designing a virtual good.

Virtual goods or experiences. NFTs can have value in themselves—for example, as virtual clothing or by granting open access to exclusive events or rights, such as voting on product designs.

Community. The idea of exclusive rights ties into the concept of “token gating,” whereby NFT owners feel a kinship with other token holders and the brand.

Ease of use will be key. The average consumer may have no interest in Web3, but they might be willing to try a program with new perks and easy ways to buy or trade virtual goods.

Forecast

Starbucks sets an example for other brands. The company’s Odyssey program is based on NFTs but extends an existing and highly successful program in ways most consumers should understand.