How Balanced Is Your 2023 Marketing Portfolio?
Marketers have been challenged over the past few years when it comes to creating annual marketing and media strategies, adapting to a changing media landscape and quickly addressing new consumer buying habits. Inflationary pressures and the possibility of an extended economic downturn complicate the current picture even further.
Brands have often put marketing budgets on the chopping block when facing economic uncertainty and seeking ways to cut expenses. But the current downturn is unusual in that unemployment remains low, and demand remains relatively strong. Marketing is a growth driver, not a cost center, so smart marketing leaders are making the business case for more investment.
The media market is more fragmented than ever, which complicates targeting and outreach but also presents unprecedented opportunities. As you finalize your 2023 strategy, keep in mind that you’ll need to balance your media investments like a financial portfolio — a strong position in performance marketing requires an offset in brand and demand building and vice versa. Here’s a look at some of the challenges and emerging best practices that can help you compete and win in the year ahead.
Increasing Competition for a Share of Consumers’ Mental Real Estate
Pandora’s senior vice president of ad innovation and B2B marketing Lizzie Widhelm summed up the media complexity dilemma when she said, “The biggest marketing challenge facing retail and e-commerce brands in 2023 is connecting with consumers with messaging that meets them in the moments that matter.” It’s all about setting priorities that reflect what’s relevant and important to consumers.
Marketers need to be able to meet consumers in those moments that matter, at any point in the funnel — from discovery to conversion. Because there’s more competition for consumers’ mental real estate across an increasing array of channels, balance is the key to success.
Many marketers have blown out the bottom of the funnel and over-invested in search, for example. Brands in this position need to expand beyond lower-funnel acquisition by diversifying spend and testing messaging and creative to see what resonates and drives demand. If you’ve already optimized the bottom, then create balance by driving demand and consideration. In testing different content, you can identify when you have consumers’ attention and drive action in those unique “moments that matter.” Making a strong and true connection at that moment in time can yield significant lifetime value by better anticipating the deeper needs of your audience.
Getting the Balance Right
Different channels and platforms reach different audiences. The emergence of new channels and tactics over time — TikTok, influencers, Insta, Snap, Twitch, Reddit, and others — dramatically lowered the barrier for new brands to connect with their target audiences. While many traditional marketers mourn the fragmentation of the landscape, the truth is, fragmentation of media and the niche audiences that have self-organized around content have democratized advertising.
Traditional, offline high-reach TV, radio, print, and outdoor advertising is prohibitively expensive for many brands. When those channels were the primary options for building national brand awareness, iconic brands could own market share. Today, a startup can cut deeply into a large, established brand’s market share practically overnight targeting self-identified and self-organized audiences on high-engagement social platforms.
That said, performance marketing should be a component in a larger strategy and not strategy in and of itself. For emerging brands, it can work spectacularly well when the digital audience is perfectly aligned – but sticking to that one tactical component will soon saturate the audience and drive up customer acquisition costs. Allocating a portion of your budget to upper funnel is a brand investment that will pay dividends in time. The key is getting all stakeholders to understand it will drive up blended CPA in the short term, but will create the path for new audience and brand growth in the future.
As you put the finishing touches on your 2023 marketing and media strategy, be mindful of how brand marketing supports performance marketing further down the funnel.
- Get your stakeholders on board to invest in awareness that will drive demand.
- Re-balance brand and performance allocations quarterly (or monthly if your trendlines are clear).
- Test continuously to understand which creative is performing with primary, secondary and incremental audiences
- Meet your potential (and existing) customers in the moments that matter.
Be patient as you watch your marketing investments yield dividends. With a balanced marketing portfolio, your creative and media investments can fuel a growth engine and spin up that elusive flywheel, even in challenging times.
Christian Jones is SVP, Marketing and Client Development, at Hawthorne Advertising.