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3Q Digital’s 2021 Year in Review

Published: January 10, 2022

Author: Diana Gordon

Insights from the Experts: eCommerce Series

It’s the most wonderful time of the year! Yes, the holidays but also…the year in review recaps have arrived! Spotify dropped its annual Wrapped lists on December 1st. Tiktok has said it had a “2021-of-a-K2021ind Year,” Google’s search trend report showed us how challenging a year it was for most everyone, and Amazon is selling a limited edition Time Magazine Year in Review 2020 copy for $24.95.

All kidding aside, the annual recaps that we all put out are one of my favorite things. Not only is it a helpful reminder of everything that occurred in a given calendar year – and 2021 was exceptionally busy – but it also provides insights into where an organization will focus its efforts in the coming year.

So, what are some big things that happened over the last twelve months?

Signals Losses (what the FLoC?)

It was a big year for data privacy, albeit maybe not as big as initially planned. Google started the year off by introducing a new acronym, Their Federated Learning of Cohorts (a.k.a. FLoC) was positioned as a privacy-first alternative to third-party cookies, which Google initially planned to stop supporting in their Chrome browser in early 2022. By June however, Google had delayed that plan until 2023, citing a need to work more closely with regulators in various markets. It could also have been a result of a widely panned response from the rest of the tech community for what essentially is a highly-modeled and seemingly black box solution for ad tracking and measurement.

iOS 14.5

The world celebrated “data privacy day” on January 28th, and Apple marked the occasion by releasing a white paper titled “A Day in the Life of Your Data.” Apple’s goal was to continue promoting a bevy of new features in the iOS 14.5 release that gave users more transparency and control for how apps and websites collected and used their personal data. According to data analytics firm Flurry, 97% of iOS users opt out of ad tracking. This has resulted in a massive loss of data and marketing effectiveness indicators – especially on Facebook – with most of the industry scrambling this year to get serious about replacement data strategies, including the development of a first-party data acquisition program.

Social Surges

Social media continued to dominate the headlines this year, and not always for the right reasons. Despite the negative publicity and scandal, our friends in Palo Alto still managed to add another 2.7 million users to Facebook’s platform in 2021 – an increase of 13% worldwide. While the adoption growth of the platform has slowed, Facebook continues to be the biggest player in the social media space. They moved ahead in announcing their rebrand in late 2021, changing their name from Facebook to Meta. This move by Mark Zuckerberg is a signal of things to come: a virtual world where digital avatars connect through work, travel or entertainment using VR headsets. Zuckerberg has been bullish on the metaverse, believing it could replace the internet as we know it. According to him, “The next platform and medium will be even more immersive, an embodied internet where you’re in the experience, not just looking at it…”

But for Facebook to realize this futuristic vision, they must first succeed in building a new version of social sharing, specifically social shopping. In 2021, Facebook was heavily evangelizing its platform for commerce, and worked hard to get brands to adopt Facebook Discovery, implement the Facebook Conversions API, and curate shops with product ad tags and custom shopping audiences.

TikTok was the other big social media name in 2021. Not only was the video platform recognized as the most downloaded social app of the year by App Annie, Forrester claims TikTok became more popular with kids aged 13-17 than Instagram this year. TikTok’s cache with Gen Z is almost like a rebuke of the Meta-owned Instagram. If Instagram has contributed to a highly polished and filtered world view as users snap pics and videos that are “worthy of the gram,” TikTok aimed to go the other way, encouraging users to be unapologetically authentic and revel in the real and raw. This watershed of new users had a lot of brands scrambling to figure out how to capitalize on the popularity growth of the platform with an increasingly critical Gen Z audience.

Economic Impacts

Like seemingly everything else we bought in 2021, the prices of media ads increased as well. Initial forecasts made in April had set media rates to rise three percentage points. However, by the middle of Q4, analysis raised the forecast a full percentage point. This was especially relevant to digital ads, as the traditionally higher CPMs and CPCs that we experience during the holiday season kicked in. In addition to these rising ad prices, advertisers across a variety of verticals experienced many of the same 2020 tailwinds, turned headwinds this year. 3Q Digital’s account teams spent much of the year consulting our brands on readjusting performance forecasts and setting new KPI benchmarks as everything from softer demand and lingering supply and inventory limitations to the increased costs of transporting raw materials and finished goods made 2021 a challenge across the board.

2021 Ad Price Inflation Worldwide across offline and online media

So there you have it! 2021 was a banner year with lots to be proud of, and there is still so much more work to keep us busy into the new year. As we return from a well deserved holiday break, we’ll share with you our predictions for the trends and opportunities to come throughout 2022. Stay tuned!

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