As we approach the end of the year, we’re covering trends from key markets in 2022. We’ll recap the state of each industry over the past year, the ad strategies of its biggest players, and what we predict 2023 will hold.
A scroll through The Fortune 500 makes it clear that technology is big business.
In 2021, the technology sector contributed around $1.8 trillion (9.3%) to the country’s GDP.
Although that represents a slight decrease from 2020, technology companies aren’t hurting. For instance, Apple’s revenue has quadrupled in the last decade.
Unsurprisingly, advertisers across the industry have deep pockets, and most of them showed that in 2022. That said, supply chain challenges and financial hardships could pressure advertisers in 2023.
MediaRadar Insights on Technology Advertising in 2022
Through October, more than 21.2k technology advertisers spent nearly $12b on digital, print and TV ads, representing a 27% YoY increase from 2021.
Their average monthly investment also jumped, increasing by more than 95% YoY ($930mm in 2021 vs. $1.8b in 2022).
The most significant increase came in September when budgets spiked by 56% YoY in preparation for the holiday season.
Overall, spending in Q1 was up by 36% YoY, while Q2 and Q3 increased by 19% and 33% YoY, respectively.
Although spending was up significantly, the majority came from advertisers at just 22 companies—including Adobe, Alphabet, Inc. (Google’s parent company), Amazon, Apple, Meta, and Verizon—who combined to spend $6.3b or 53% of the investment from technology advertisers.
Other top technology advertisers were AT&T Inc., IBM Corporation, Shopify, DISH Network LLC, and Denali Holding Inc.
The holiday season should prompt further increases—spending increased by 12% YoY in October—but the recession and financial pressure could dampen advertisers’ holiday spirit.
Top Tech Advertising Categories in 2022
Three categories dominated spending through October: consumer electronics (cell phones, computer hardware, tablets, etc.), software, and telecommunication holding companies (AT&T, T-Mobile, Verizon, etc.).
Combined, these advertisers spent $10.2b or 86% of the investment from the industry.
Software
Software advertisers, who accounted for 33% of total spending, increased budgets by 49% YoY to nearly $4b.
Spending increases from software advertisers remained consistent during the year, jumping by 50%, 45%, and 56% in Q1, Q2, and Q3, respectively. Spending continued in October, increasing by 37% YoY.
Industry giants Adobe, Intuit, and Squarespace were some of the biggest spenders, each investing more than $150mm during the first nine months of the year.
Intuit
Intuit—think TurboTax, Credit Karma, Mint, QuickBooks and Mailchimp—is synonymous with splashy marketing campaigns.
This includes a residency on the NFL’s stage, which it secured through 2026 to “build awareness and purchase intent among the NFL’s highly engaged and live-viewing sports fans.”
During the fourth quarter of Super Bowl LVI, Intuit ran a 30-second TV spot featuring DJ Khaled promoting QuickBooks and MailChimp.
At the same time, the company ran its ninth consecutive ad for TurboTax to highlight the versatility of its TurboTax Live AI expert matching tool.
As Intuit leans into the sports-obsessed younger generations, its Super Bowl ads will continue making headlines. Its push into TikTok and OOH will draw attention as well.
Squarespace
Squarespace is also aiming at the hearts and wallets of younger generations.
Specifically, the company is targeting the “creator economy.”
In September, Squarespace debuted “Creator Hub” and a new campaign to help creators make their own “empires.” The campaign and fresh go-to-market strategy signal a more significant shift and deviation from its historical “celebrity-heavy” ad strategy.
As Squarespace shifts its focus, its ad strategy will adjust accordingly, which we already see as it goes all-in on podcasts.
Consumer electronics
Consumer electronics advertisers, who accounted for 33% of technology spending, spent $3.86b through October, representing a 56% YoY increase.
The biggest increase came in Q1 when budgets jumped by 80% YoY. Q2 and Q3 also saw respectable increases of 46% and 63% YoY, respectively.
Much of this spending came from those promoting cell phones (36%), including Alphabet and Apple.
Apple
Apple generated more than $42b in iPhone sales during Q4 of its 2022 fiscal year.
As Apple fights to fend off Google, Samsung, and other industry giants, advertisers at Apple will continue to spend big on iPhone promotion.
That said, they’re in a tricky situation.
On the one hand, declining profits and production shortages are likely putting pressure on their budgets.
Despite its cult following, more consumers are cutting discretionary spending, and as they do, they could push consumer electronics down their wishlists.
On the other hand, iPhone sales have remained steady, which could mean that this pocket of Apple’s ad budget will remain immune to economic uncertainty.
Another tricky situation: Twitter.
In November, Elon Musk said that Apple “has mostly stopped advertising on Twitter.”
Despite the tweet, another article reported Apple spent $84,000 on Twitter ads that day.
The back-and-forth narrative speaks to the conundrum advertisers find themselves in right now with Twitter.
While Musk seems steadfast in his ways, if too many of the platform’s top advertisers flee, he could reverse course.
Alphabet
Despite the almost unbelievable dollar amount advertisers spent in 2022, they can’t circumvent the reality that consumers are tightening their belts.
Tech holding company Alphabet may find its advertisers doing the same in 2023.
Following a Q3 that saw revenue slow to 6% and sales-and-marketing expenses rise by 26%, Alphabet CEO Sundar Pichai stressed the importance of productivity and efficiency across the company.
The unease from one of the world’s biggest companies illustrates that even advertisers with the deepest pockets may not be immune to the brunt of 2023 and the budget cuts that come with it.
Computer hardware advertisers also spent big, investing $241mm or 6% of consumer electronics spending. Top spenders in this category include Denali Holding (Alienware and Dell), Intel Corporation, and Lenovo Group.
Telecommunication holding companies
Many technology advertisers spent big in 2022.
Those from telecommunication holding companies weren’t so lucky.
Through October, advertising for telecommunication holding companies decreased spending by 10% YoY.
The fall continued into Q4, with budgets dropping by 10% YoY and 31% MoM in October.
Cell providers from AT&T, T-Mobile, and Verizon combined to spend $1.75b, accounting for more than half of the category’s investment.
AT&T
Advertisers for AT&T saw their budget drop by 28% YoY.
The reduced spending from one of the world’s biggest companies comes in the wake of an up-and-down year.
Overall, revenues for Q3 2022 dropped by 4.1% YoY.
Although the company recently lifted its profit forecast as travel rebounds, which could point to a more lucrative year for advertisers, recent marketing and sales layoffs tell a different story.
T-Mobile
Advertisers for T-Mobile reduced spending by 46% YoY, which could signal financial pressure but could also be a continued reset following its acquisition of Sprint.
The decline could also reflect a shifting strategy that’s putting a premium on its T-Mobile Ad Network. This could indicate the company is moving away from advertising as a revenue driver and will rely on its ad network instead.
Verizon
While advertisers for T-Mobile and AT&T saw their budgets slashed significantly, those for Verizon saw a slight decrease of just 7% YoY.
The small decrease, despite a rocky 2022, shows that spending from some technology companies will persist or remain steady during the uncertainty, especially as competition intensifies and continues to innovate.
DISH Network adopted a similar strategy, increasing its budget by 38% YoY to promote Boost Mobile and DISH.
Tempered but Sky-high Spending
If Nostradamus were around today, he’d predict that technology advertisers will continue to spend in 2023.
However, he’d also say it won’t be a free-for-all as the uncertain economy puts pressure on the world’s biggest technology companies.
With the economic outlook clouded in mystery, advertisers for the likes of Amazon, Meta, Verizon, and Alphabet, will likely be asked to do more with less as their leadership teams attempt to weather the storm.
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