Economic uncertainty is weighing heavily on the minds of business leaders worldwide as 2023 gets underway. Whether real or perceived, a decline in economic activity puts added pressure on marketing teams to deliver results in a more challenging environment and, all too often, on a smaller budget. But the reality is that many businesses aren’t seeing the returns they would like from their digital marketing spend. Why might that be?
More than 30% of marketers who responded to the February edition of The CMO Survey said they were getting average-to-no returns on their digital marketing investments. But it would be a mistake to lose faith in digital marketing as a concept and reallocate budgets to traditional channels like print and radio. Digital still works and offers a wide range of distinct advantages, like the ability to hyper-localise, personalise, automate and track performance. But there is a right way and a wrong way to go about it, and the latter effectively wastes those advantages.
An integrated approach to digital marketing
Writing for the Harvard Business Review, Christine Moorman, Jana Soli, and Dennis Cardoso attribute the digital marketing performance gap, in part, to companies having not yet fully integrated digital elements across the business and that “having a digital marketing arm simply isn’t enough”. Many businesses haven’t modernised their thinking around digital marketing and still take a siloed approach to its various components.
Today, brands exist in a multi-channel world and marketers need to integrate those digital brand experiences into a cohesive vision and strategy with overarching KPIs. Only by doing so does it become possible to accurately assess the ROI of a digital budget, as the performance of a single channel simply doesn’t tell the whole story.
Solving the challenge of data analytics
The CMO Survey notes that spending on marketing analytics, after being flat for over a decade, has risen by 37% since pre-pandemic levels to an all-time high (8.9% of marketing budgets). Analytics is now guiding nearly half of marketing decisions, yet a skills gap is a significant hurdle. Only 3.6% of survey respondents said they possessed the talents needed to get the full benefit of marketing analytics. This can be attributed to the growing complexity of marketing tech stacks as well as the difficulty of turning data into actionable insights.
Closing gaps in the buyer journey
Customer journeys have also been getting increasingly complicated, thanks to the proliferation of channels in the digital landscape, earned, owned and paid, from blogs to apps, social media to websites. This makes it more difficult to map the customer journey and, therefore, difficult to spot problem areas that need to be improved. Marketers need to rise to the challenge of acquiring a complete picture and getting a handle on their omnichannel strategies.
Adjusting to the loss of third-party data
Globally, there’s a greater demand for privacy than ever before and governments are enacting more stringent legislation around third-party data. A cookie-less world is rapidly approaching and many marketers are nervous about that. It puts more pressure on organic channels where data is more difficult to score. Marketers need to find other less invasive ways to learn about their customers, which presents a significant challenge for some. First-party data and authentic customer engagement will carry the day and marketers need to reinvent their approach to be more organic and opt-in-orientated.
Digital marketing still offers an excellent return on investment, so long as these boxes are ticked. A modernised strategy that makes smart use of data remains a winning formula that can see businesses through even the toughest of market conditions. So, get in touch with us and let’s discuss a tailored digital marketing solution for your business.
