Adam Roodman, GM of Yahoo DSP, shares his perspective on what the year ahead will look like for digital advertising.
The Cookieless Conversation Isn’t Going Anywhere Anytime Soon
With Google’s decision to keep cookies but allow consumers to opt-in or out, marketing on the open web will need to adapt. This shift mirrors trends seen on iOS, where 76% of consumers opt-out, suggesting that third-party cookies may phase out through consumer choice. Depending on opt-out rates, marketers will need to replace or supplement cookies with privacy-centric options to support audience targeting, activation, and understand the impact on measurement.
Without investing in strong ID partners, advertiser dollars could shift away from the open web. Advertisers will need to focus on obtaining consumer consent through transparency, trust, and building a value-exchange for their data. Nearly 90% of advertisers are prioritizing partnerships with companies that align with their values, highlighting the growing importance of shared principles in today’s evolving digital landscape.
Contextual advertising, which leverages the content of the webpage to deliver relevant ads ensuring that irrelevant or intrusive advertisements do not disrupt the user experience, will remain an important element once cookies have been phased out. This approach not only respects user privacy but also enhances the overall effectiveness of ad campaigns by aligning ads with the context in which they are displayed.
To Diversify Ad Spend Across Platforms, Start Spreading Bets
Just as advertisers are devoting spend to post-cookie alternatives, brands are also testing other ad channels in light of current litigations with the likes of TikTok and Google. Advertisers want to diversify their ad spend and will turn to many platforms to fill the void—whether traditional behemoths or smaller, but more transparent ones. In fact, over 80% of advertisers agree that they’ll be reallocating budgets to explore fresh channels and platforms in the coming year. This diversification is not just about spreading risk; it’s about finding new opportunities to engage with audiences in more meaningful and targeted ways.
When advertisers explore alternative platforms, they can tap into diverse markets and communities, thereby increasing the relevance and impact of their campaigns. Diversifying ad spend allows brands to experiment with innovative ad formats and technologies that may not be available on more established platforms. This can lead to more creative and engaging ad experiences, which can drive higher user engagement and better campaign performance.
As the digital advertising landscape continues to evolve, brands that are agile and open to exploring new platforms will be better positioned to capitalize on emerging trends and stay ahead of the competition.
Digital Advertising Is Going to Rely on Retail Media as a Growth Engine
Retail Media is growing rapidly as an alternative to established media channels but is still in the early stages of development. By 2028, Retail Media’s share of incremental digital ad spending is expected to reach 60%, reshaping the landscape and decelerating growth in traditional search, which is projected to approach flat YoY growth by then. This shift toward Retail Media, now increasingly reframed as “Commerce Media,” is driven by non-retail companies joining the movement, leveraging audience data in new ways that empower advertisers.
Market dynamics are facilitating this diversification, offering unprecedented opportunities for data measurement and syncing across platforms. As measurement capabilities expand, advertisers are gaining greater control over targeting, personalization, and attribution. The market is helping facilitate this diversification by making measurement and data syncing across partners better than ever, moving the power into the hands of advertisers.
However, the maturing landscape brings pressing questions. Is traditional media planning still feasible in a landscape of proliferating and mutually exclusive walled gardens? How are reach and frequency managed in this environment? What issues exist around measurement standards, comparing retail media networks (RMNs), whether their premium pricing can be justified, and how they can be integrated with other channels?
Addressing these challenges will be crucial for advertisers to effectively navigate the evolving digital advertising ecosystem.
There Is No Stopping CTV
As consumers increasingly shift from linear TV to streaming, CTV advertising has become essential for reaching on-demand audiences. Enhanced advertiser control over reach, frequency, targeting, and measurement makes CTV especially attractive, despite market fragmentation. This combination of consumer demand and advanced data capabilities positions CTV for continued growth.
In 2024, 84% of households would subscribe to one or more streaming services. In Q1 2024 alone, 44% of ad-supported TV viewing came from streaming services[1]. These numbers are expected to have grown in 2024 due to more audiences shifting away from linear TV to streaming services like Netflix and Disney+. With many of these platforms launching new ad-supported tiers, we are seeing a shift to ad-supported subscribers.
Additionally, 83% of advertisers agree that they will shift their ad dollars to explore different channels/platforms in 2025. This trend signifies the growing importance of CTV as a key channel for advertisers looking to diversify their spending and reach new audiences. It will become increasingly important to align contextual targeting and creative to the content genre. A Yahoo study shows that creative that is contextually relevant on CTV drives greater attention (eyes on screen, on ad) and is better received by consumers.
AI Will Continue To Be Advertising’s Creative Catalyst
AI will play a pivotal role in shaping the advertising industry in 2025. More agencies are seeking AI-driven solutions to reduce costs and increase the speed of output. 96% of advertisers say AI will have a major/moderate impact on advertising and marketing, and 86% are already using AI-enabled tools in their roles[2].
AI pushes media mix modeling and measurement to become more efficient and sophisticated. AI will have a material impact on business models, with agencies using it as a differentiator, and as ad tech companies incur costs to build and maintain models. Creative, Insights & Optimization, and Ad Fraud Detection are the top tasks where advertisers will see the biggest impact from AI soon.
And bear in mind: not all AI is created alike. We’ll see an increase in usage of AI tools, but also an increase in scrutiny over what these tools do and how they are built.
Advertisers Need Choices To Take Back Control
Given the changing and increasingly complex landscape, it will be more important than ever to give advertisers the tools they need to succeed—and to put control back in their hands when it comes to deciding the best path forward. Long gone are the days of being the arbiters of truth for a brand—giving them a wide array of guiding principles and solutions will allow them to take back control and choose the path that works best for their brand.
As we step into 2025, the digital advertising landscape is poised for major changes. From the consumer-driven privacy revolution to the rise of contextual advertising and the diversification of ad spend, the industry is evolving rapidly. Retail Media and CTV will continue to grow, while AI will revolutionize how we approach advertising strategies.
When advertisers have choices and controls, we can navigate this complex landscape together, ensuring that brands thrive in the new era of digital advertising. Let’s welcome the changes ahead and make 2025 a year of innovation and success.
[1] Magna: US Media Landscape, Fall 2024
[2] Yahoo 2025 Trends study, Nov 2024
