The year ahead: Lucky 13?
After the event highs of 2012, the new year may be looking a little lacklustre in comparison, but technological innovation means 2013 is set to be just as exciting and challenging. Here’s Marketing Week’s guide to making this year a good one.
While 2012 was undoubtedly a packed one for brands – with events such as the Diamond Jubilee, Olympics and UEFA European Championships putting the spotlight on Britain like never before, 2013 could be seen as an anti-climax, with some dubbing it ‘empty 13’.
But the evolution of a raft of new technology means that ways to communicate with consumers will become more exciting than ever and this, combined with the explosion in data available, means that marketers will be under more pressure to prove that what they do is valuable to businesses.
So here is Marketing Week’s guide for marketers to help make this year a lucky 13.
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1. Ruthlessly cover all channels
The numbers of channels available to consumers has exploded and last year saw retailers such as John Lewis and Marks and Spencer bringing digital in-store with interactive screens - as well as ensuring their core brand values were present across mobile, tablet and online. Online only brands eBay and Amazon also created a physical presence with pop-ups.
Richard Furness, director of brand and engagement at Guardian News & Media believes that people will keep demanding that products and services are available on all channels as connected TVs, tablets and smartphones become mainstream.
“Advertisers and marketers will need to constantly innovate and push boundaries as they look for new ways to engage audiences and market their brand effectively. I expect mobile to play a massive part in this. Brands will need to fully embrace this change and adopt a mobile-first strategy,” he predicts.
Indeed, 55 per cent of retailers say that attracting more customers to their websites will be their biggest challenge for this year, according to research by software company SLI Systems which looked at 110 UK retailers. It notes that 41 per cent of retailers added a mobile-optimised website in 2012.
Ebay predicted that almost a third of Christmas purchases would be via mobile or tablet, and this trend is set to continue. Carrie Bienkowski, head of buyer experience at eBay, says: “I think it shows where the retailer landscape is really vibrant and where we’re going to be focused in future.”
But being available in many channels does not refer only to online versus offline, Bienkowski adds. “People want to be able to shop anywhere, any time, on any device and channel. Online is online but we know that a lot of our brands and retailers are putting up successful programmes around click and collect and that’s really the future of retail.”
This will extend further than simply linking up in-store and online, says Mike Hoban, Thomas Cook’s marketing, sales and e-commerce director in the UK & Ireland. “It’s not just about creating a catalogue online or a plasma screen in a store with web access, marketers will have to integrate campaigns. We’ll also see near field communication (NFC) go mainstream as brands take advantage of this.”
My view: Do it or die
Deputy news editor
Being able to interact with brands and retailers through any channel will be expected in 2013. Those embracing technology such as augmented reality, mobile and location based tools to bring shopping to life in every channel, whether it’s digital or physical, will show they understand the demands of consumers.
Social shopping, where social media, mobile and commerce come together, will be a big theme and brands that can provide value for their customers and ways to combine insight from these areas will do well.
A good multichannel experience will enhance every aspect of the shopping experience, not just with tools that help customers but for sales assistants too. There is no excuse for ill-informed and unhelpful store staff. Everyday technology such as iPads being used on the shop floor enables them to access almost unlimited information in real time.
However, multichannel doesn’t mean just having e-commerce and stores lined up. It means making sure stores, mobile, tablets, social, online video and interactive technology all work together seamlessly.
As smartphones and tablets become even more ubiquitous, any retail brand that isn’t thinking multi- or even omni-channel will find themselves left behind. Those that achieve it will be rewarded with loyalty and custom in 2013.
2. Get personal or risk rejection
Imagine a clothes shop where all the items are the ones you want and in the colour and size you like. Web personalisation is the future, according to Dan Rubel, group strategy director at Shop Direct Group, which includes Very.co.uk, Littlewoods.com and isme.com. “One of the biggest areas of innovation across online retail is multi-platform personalisation, enabling customers to be presented with a shop that is tailored for them. Customers are increasingly demanding not just choice but also smart curation of that selection, customised for them.”
An increased multichannel approach has also seen a rise in demand for personalisation on various platforms and NFC technology has also raised the possibility of targeted promotions sent direct to the shopper via their smartphone.
Localised campaigns, curated collections in retail or promotions based on shopper behaviour sent direct to consumers’ mobile devices are all ways brands can and have been offering a personalised experience.
Personalisation can also work on a localised level allowing brands to target by region. Cinema sales house DCM switched its distribution, campaign delivery and scheduling to digital in most chains in the UK in 2012, which, along with the shorter leads times from three weeks to one, means it can offer advertisers the opportunity to target consumers more effectively in cinema chains in local areas.
Although mobile is a big area of opportunity for brands (see viewpoint, X) especially when it comes to personalisation, Lawson Muncaster, the managing director of newspaper brand City AM warns that it should be treated carefully. “Mobile is en vogue but it’s important to understand that it’s part of a complex media consumption. Facebook has a problem, either convincing its users about its commercial aspirations or competing with the next big thing that captures the interest of the younger generation.”
My view: Consider mobile carefully
Adverts tracking users across the internet were commonplace in 2012 and the full implementation of the EU Privacy Directive will make regulation something to be grappled with this year.
This year I expect this to take a new dimension as mobile internet usage continues to rise. Companies are developing technology that can ‘triangulate’ mobile users and serve ads on their devices based on their browsing behaviour online. Drawbridge is one company doing this and is one to watch.
Does this sound a little ‘big brother’? It might do - and this technology will come under intense scrutiny from consumer groups and regulators alike.
Meanwhile, I don’t think NFC technology will fulfil its potential because Apple is refusing to include it in iPhones, even though it has been mooted as a potential game changer for years by the likes of Nokia, Samsung and Blackberry. Retailers are therefore unlikely to see the benefits of updating their payment systems.
I would also raise questions as to whether 4G will change our lives in 2013. Seasoned marketers will remember the BT Cellnet ads promising super-fast mobile internet speeds dating back to 1998. Can we truly say we have that now even with 3G? The answer is no.
3. Let consumers run your brand
“In the past, businesses needed to research what customers wanted and now they are telling us directly, explicitly via social media and implicitly via the content they share,” says Karl Gregory, managing director UK & Ireland at Match.com.
“Consumers will continue to drive change. Last year has shown that customers want valuable information that matters to them and creating content that is engaging and relevant is of value to consumers. Ensuring it is shareable will be critical for brands trying to achieve cut through.”
Adam Stewart, marketing director for Rakuten’s Play.com agrees. “This year, brands that focus on engagement alongside social community growth will thrive. It’s not just a question of growing fan numbers, engagement is what really drives revenue. As such, we expect brands that deliver ‘talkability’ to excel.”
Stewart gives the example of Nike’s Olympics campaign last summer. Despite Adidas being the official sponsor of the London 2012 Games, a Nike guerrilla campaign using #findgreatness got people talking. Nike achieved a 6 per cent growth in its number of Facebook fans and a 77 per cent boost in engagement on its Facebook page compared to 2 per cent and 59 per cent respectively for Adidas, according to Experian Hitwise.
Trusted brands will benefit, according to Sarah Warby, marketing director at Sainsbury’s. “Consumers will continue to be more demanding of companies. They have more knowledge than ever before and will think carefully about where to spend their hard-earned cash. Customers will reward companies that work hard to be closer to them.”
Getting consumers to be involved in creating content will continue, claims Dave Coplin, chief envisioning officer at Microsoft Advertising. He says that people will need to be ‘enchanted’ by advertising. “There will be three trends dominating this year: consumer centred design, creative-collaboration and clever content. We are entering an age of advertising ‘enchantment’ where campaigns need to flow seamlessly into consumers’ everyday lives, meaning brands will need to be more relevant, agile and interactive.”
My view: Be responsive on social
Brands will have to understand the need to be able to respond to consumers’ requests on social media, whether they are gigantic crises or simple service requests, or risk the wrath of their customers in a very public way.
Social CRM company Conversocial claims 30 per cent of consumers expect an answer within 30 minutes on Twitter, while 29 per cent expect an answer on Facebook in under two hours.
Meanwhile, consumers have become increasingly aware about how valuable their behavioural and interest data on social channels has become to brands when it comes to serving ads.
Services such as Peerperks, which offers influential social media users freebies from brands in the hope they will share their experiences with the goodies with their audiences, sprung up last year and we can expect more of these, where consumers can optimise from which brands they receive messages.
Marketers must look to enchant users on Facebook and Twitter rather than simply encouraging them to click Like in order to boost their engagement metrics. This year, they should look to give their social media audience value in exchange for their following - through humour, tips or competitions, for example.
4. Prove the ROI of everything
A poor UK economy adds pressure on all sectors to prove their worth. For marketers this means the need to prove return on investment will continue into 2013. As many as 60 per cent of marketers expect increased company targets and report that their marketing budgets will either remain static or be cut, according to the CIM’s marketing confidence monitor published in November 2012.
Paul Sweeney, a senior analyst at Bloomberg, explains: “ROI is a long term secular trend in this business. I don’t think any marketer believes it’s going to get anything but more challenging and it becomes more of a pressing issue as advertising spending comes under pressure because of a weak economy. When an advertiser has fewer dollars to spend it demands more from its marketers to prove return on investment.”
Marketers using pay-per-click (PPC) will demand better efficiency from providers, according to Gemma Carver, the group marketing director of restaurant reservation service Bookatable.com. “PPC will continue to play an important role but there have been many who have questioned its efficiency to provide good-quality traffic that converts. We will see the online advertising providers respond with smarter solutions - and at the same time, marketers will think hard about their PPC spend and whether it might deliver better traffic if spent elsewhere.”
But Kristin Brewe, director of marketing and communications at the IAB, believes a focus on ROI is not always an efficient way to build a brand. “The laser beam focus on ROI will not go away,” she says. “It’s not that it’s wrong to demand a return on investment from a campaign but the pressure to hold every single action to a direct benchmark often takes resources away from efforts that truly build value.”
My view: Use insights to inform spend
The ability to prove return on investment (ROI) will be crucial for marketers this year. Many are expecting budgets to remain static or be cut and growth targets to increase, according to research by the Chartered Institute of Marketing last year.
This effectively means they will have to do more with less but lack of budget should drive creativity rather than stifle it, after all it’s a creative industry.
What is important is understanding consumers through data and insight. Big budget glossy advertising and mass market campaigns might not have the same effect this year as consumers seek out personalised campaigns that match their own values.
Therefore, understanding the needs of the consumer pre-campaign will help with spending the budget effectively by knowing where your consumers are and what they are looking for from your brand. Post-campaign insight will enable marketers to prove ROI by using data to back up the spend.
Being able to prove ROI will also foster better relationships between marketing and the finance department. Increased communication between the two, on where the spend is going and why and marketers’ ability to show how the spend has worked, will enable both departments to understand how best to apply the marketing budget in the coming months.
5. Scrutinise your data
The increased focus on measurement requires an understanding of data. One of the key issues this year is the ability to understand big data and apply it effectively.
Having the skills to glean insights from data presents a challenge for marketers. However, there are opportunities to “apply cross-functional thinking in an organisation in order to tackling the challenges,” says Brewe at the IAB. “Get a developer in the room when you’re thinking about advertising campaigns that span platforms and have your PR or corporate communications teams in the room when you’re exploring social media.”
Using data in the right way will be crucial to understanding what consumers are doing, says Fiona West, portfolio marketing director UK and Ireland at Brown-Forman Beverages, which owns brands such as Southern Comfort and Jack Daniels.
“The ones that really understand their customers and know how to continually engage with them will be successful. It’s vital for brands to be brave enough to stand for something and have a clear point of view. The ones that do well will ultimately enjoy a clear white space to grow and stay top of consumers’ minds.”
Jane Frost, chief executive at the Market Research Society believes the issues for big data will be around which parts of it will be relevant and useful and whether the right questions are being asked. Frost says: “The debate around big data tends to be around ‘what is the answer to life, the universe and everything’. Someone will say 42 next year and people will sit back ask, what was the question?”
The focus on data is not just an issue for big brands according to Carver at Bookatable.com. She says: “Big data will continue to be a major focus but not just for the big companies like eBay and Amazon which were talking about it in 2012. In 2013, we will see many more brands and smaller companies emerge as innovators in this space.”
While there may be a temptation to rely heavily on data because it gets quick results, Gregory at Match.com warns that brand-building campaigns will also be important.
“We will see increased tension between functional direct response advertising and emotive, insight-based marketing. Marketing is in danger of becoming more short term, designed to increase immediate sales to the detriment of long term brand building. This shift towards short term focus is partly due to the recession and partly due to an increasing trend for short-lived chief marketing officer tenures.”
My view: Be clear on data use
The rise in digital media, advertising and retail has led to an overwhelming increase in the amount of data being generated. But unless businesses know what to do with the data, collecting it becomes a fairly pointless exercise because without insight, data is useless.
The job now, therefore, is to get that data into a state where it can be analysed and used, and in doing so unlock its true value. Some are already there but not nearly enough.
Brands can target advertising to a finite degree, in real time, meaning they can connect with the right consumers, at the right time, in the right place, with the right message. Knowing who the consumer is, in terms of profile and demographic, means the creative can also be tailored to match that person’s specific requirements, something that will become more commonplace this year.
Mobile will also play an increasingly important role as advertisers and media owners begin to take advantage of location-based data to target brand messages even further.
Big data by its definition is big and can be scary, especially for consumers who are being bombarded by requests for information on a daily basis without always being given clear indication of how that data will be stored or used. Companies will need to be more transparent about what goes on behind the scenes.