As we head into 2023, marketers face an increasing set of challenges and opportunities. The pace of technological change is quickening, and customer expectations are constantly evolving. To stay ahead of the curve, marketers must be proactive, data-driven, and focused on delivering long-term results.
Businesses must be proactive in the fast-paced digital marketing landscape. This requires constant monitoring of industry changes, emerging technologies, and shifts in consumer behaviour. In 2023, decision makers need to adopt an approach that incorporates trends with a data-driven approach, to be able to make informed decisions and optimise marketing strategies.
According to McKinsey Global Institute, taking advantage of customer analytics can generate immense value for business. In fact, data-driven organisations are 23 times more likely to acquire customers, 6 times as likely to retain customers, and 19 times as likely to be profitable
Businesses who employ data-driven marketing can track the entire customer journey in real time without the consumer even noticing. Big data allows them to capture trends and predict future behaviours to create a more personalised experience. While data-driven marketing is important for offering deeper insights into consumer trends and behaviour, you can combine it with traditional marketing to detect the emotions, opinions, and attitudes behind that behaviour.
When looking to effectively implement a data-driven approach, marketers need to start by collecting relevant data from various sources such as customer interactions, website analytics, and social media metrics. Once the data is gathered, it can be analysed to identify patterns and insights that can be used to inform marketing decisions.
A great way to streamline this process is to use advanced analytics platforms, such as DMPs (to connect first, second and third party data to make data accessible and actionable) machine learning algorithms, and AI-powered tools to automate data analysis and gain valuable insights with greater ease. By leveraging these technologies, marketers can make informed decisions based on the data available to them and ensure their marketing strategies are optimised for success.
Economic downturns often leave an indelible mark on the business world. For example, the 2008 recession shook various economies to their core causing a 13% decline in the entire U.S. advertising market. Fast forward to the present day, and it seems that history may be repeating itself. According to a recent report from the International Business Barometer, more than half of all businesses are bracing themselves for the next recession by preparing to slash their marketing budgets over the next year.
At a time when consumers are setting stricter priorities and reducing their spending it is understandable that companies want to cut costs, however this short-term thinking may not be the best strategy. In fact, businesses that continue to invest in their marketing strategies are more likely to see long-term profitability improvements.
By maintaining their share of voice in the market, these companies have the opportunity to stand out from the crowd and position themselves as leaders in their industry. And when the economy does eventually recover, they’ll be poised to come out even stronger and more successful than before.
According to the Harvard Business Review, “In deciding which marketing tactics to employ, it’s critical to track how customers are reassessing priorities, reallocating budgets, switching among brands and product categories, and redefining value.
Marketers need to be mindful of customer sentiment and adjust their messaging accordingly. During a downturn, customers may be more price-sensitive or concerned about job security, so messaging that emphasises value and security may be more effective.
So while it may be tempting to hunker down and weather the storm, those who are bold enough to take a leap of faith and keep investing in their marketing efforts may just be the ones who come out on top.
During challenging periods, marketing departments come under even more pressure to do more with less with an increased emphasis on showcasing high returns on investment, however, regardless of the industry you operate in; it is important to strike the balance between revenue generation and fostering an environment that can contribute to long term growth.
Research by Alix Partners, found that 78% of CEOs report being seriously disrupted in the past 12 months, with executives struggling with shorter-term crises that demand their immediate attention, while longer-term structural changes are remaking industries and creating new winners and losers.
Organisations looking to strike the right balance must first re-evaluate their marketing spend and channel investments to understand which of them are the most effective areas for growth. According to the Harvard Business, ‘it is healthy to evaluate campaign spend on a periodic basis to overcome out-of-date habits and to reinvest in the right areas’, even more so during a time when resources are tight.
It is essential for businesses to look at how well they can trace results back to the initial investment, whilst analysing which areas of priority are relevant to the long-term growth the business wants to see. For example, is it more beneficial to focus on building brand awareness and increasing the number of potential customers using your products and services or is it more important to focus on retention and customer success to reduce churn.
Balancing short-term revenue generation with long-term growth requires a strategic approach to marketing. This means prioritising investments in brand building, customer acquisition, and customer retention strategies that can drive sustainable growth over time.
To achieve this balance, marketing departments must be willing to experiment with new marketing channels, tactics, and strategies. This requires a willingness from decision makers to take risks, iterate quickly, and learn from both successes and failures.
Most importantly, businesses must stay mindful of the customer journey and focus on delivering a seamless and personalised experience across all touchpoints. This can help build brand loyalty and drive long-term growth whilst creating opportunities to increase revenue generation.
To leverage MarTech investments to their fullest potential, marketers must have a deep understanding of the latest MarTech trends and how they can be applied to their specific business needs.
In our recent blog post on ‘The Importance of Choosing the Right MarTech Tool for Your Business’ we explored how the right MarTech tool can benefit businesses immensely by allowing them to ‘improve efficiency and productivity, improve customer experience and foster closer alignment across the entire business’
However, with a myriad of tools to choose from (there has been a 24% increase in the number of tools since 2020) choosing the right tool requires a clear MarTech strategy that aligns with overall business objectives and a willingness to invest in the right tools and platforms.
Organisations that are able to make the most out of their MarTech investments need to take some time to understand how well the new tool will integrate with existing tools as well as the quality of data they can expect to generate from it.
Research by Kearney found that CMOs ignore half their tools and 40% of customer data is unused because difficult integration affects the quality of data they generate, making their martech stack an unworkable collection of “shiny objects”, as such, how well a new MarTech tool can integrate with your existing systems and data sources is very important to creating a seamless and unified customer experience, whilst being able to showcase the value of this investment.
With MarTech investments accounting for 25.4% of marketing expenses, the quality of data being data quality and analytics are also crucial for maximising the value of MarTech investments. Marketers must ensure that data is accurate, complete, and up-to-date, and use advanced analytics tools to gain valuable insights from their data.
Artificial Intelligence (AI) is already making a significant impact on the marketing industry, transforming how businesses operate with many taking the opportunity to make significant time and cost savings, the likes of which we’ve never seen before.
As AI technology advances and continues to revolutionise marketing through the automation of repetitive tasks, analysis of large volumes of data, and delivery of personalised experiences to customers at scale, understanding how to incorporate it into your marketing mix can boost both creativity as well as having a positive impact on ROI.
Research by Forbes found that 70% of high-performance marketing teams claim they have a fully defined AI strategy, however, there are also challenges to overcome.
One of the main challenges for AI privacy concerns, in an age where consumers are becoming more concerned with how their data is being handled, businesses need to ensure that as AI-powered tools gather more data about customers, they are building in systems to ensure that customer privacy is protected and that data is used in a responsible and ethical manner.
Another key challenge for businesses looking to incorporate AI into their business is data quality. In a study conducted by Refintiv in 2019 Smarter Humans, Smarter Machines: Artificial Intelligence / Machine Learning Global Study, it was revealed that the biggest barrier to the deployment and adoption of artificial intelligence and machine learning is bad data quality.
This makes it even more important for businesses who want to incorporate AI into the marketing mix to ensure that they aren’t working with a system that creates data gaps or uses incorrect data as AI relies on high-quality data to provide accurate insights and predictions, so marketers must ensure that data is accurate, complete, and up-to-date.
Finally, leveraging AI in marketing requires new skill sets, including data science and machine learning. You either do it correctly or don’t do it at all. Businesses and decision makers must be willing to invest in training and education to acquire the relevant skills or collaborate closely with data science teams to ensure that AI initiatives are aligned with overall business objectives.
In conclusion, marketers face numerous challenges and opportunities as we head into 2023. These include keeping up with market trends, adopting a data-driven approach, and deciding whether to halt or continue marketing efforts during an economic downturn. Additionally, balancing revenue generation and long-term growth is crucial for businesses. Achieving this balance requires a strategic approach to marketing that prioritises investments in brand building, customer acquisition, and customer retention strategies.
Ultimately, marketers must be proactive, data-driven, and focused on delivering long-term results to stay ahead of the curve.