By 2021 marketing leaders will spend 75 per cent of their budget in digital channels according to a new report from Salesforce. Traditional channels meanwhile are shrinking away to irrelevancy.

The study is based on a global survey of 4000 marketing leaders worldwide.

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The 75 per cent figure sounds a little high to us. But the trend is certainly fixed. And the implications of such a radical shift in budget are stunning for incumbents in the more traditional channels such as TV, radio and print. They have already lost huge share –  mostly notably in print. Indeed research by Morgan Stanley suggests that most new ad dollars in the US are going to Google and Facebook, while in Australia those two companies already capture a plurality of the digital advertising dollars.

The word ‘digital’ also cops a bashing for being the worst word in the industry, with the report’s authors suggesting  ‘digital marketing’ is set to follow suit as a piece of redundant vocabulary.

In Salesforce’s third annual State of Marketing report on the current landscape, digital is becoming ubiquitous in marketing, to the point where 97 per cent of market leaders plan to increase or maintain their level of digital spending.

According to the report. “Digital accounts for an ever-growing share of marketers’ activities, channels, and budgets.”

Among the key findings;

  • Top marketing teams are integrating the customer experience. Successful marketing leaders are crossing the boundaries of business units to create a single view of the customer. High-performing marketing teams are 7.7x more likely than underperformers to strongly agree they’re leading customer experience initiatives across the business — bridging the gap between marketing, sales, and service. Sixty-four percent of top teams also say they are excellent at creating a single view of the customer, versus only 4% of underperformers.
  • Top marketing teams get smart with tech adoption. To keep pace with a dynamic industry and continually make marketing communications smarter, 72% of top teams will increase spending on marketing tools and tech in the next two years. Fifty-three percent of high performers qualify as heavy tech adopters, compared to only 7% of underperformers. Top teams are more likely to extensively use marketing analytics and predictive intelligence, among other tools.
  • Mobile momentum hits a tipping point. From 2015 to 2016, every aspect of mobile covered in this research has risen significantly in usage. This growth encompasses both mobile as a marketing platform (such as mobile apps) and mobile as a marketing channel (such as SMS). With 98% growth in mobile app usage and 111% growth in SMS usage, a majority of marketers are now using these mainstream mobile tactics to engage customers.
  • Real-time channel orchestration strikes a chord. Leading marketers understand the value of a cross-channel approach. In fact, top teams are 3.2x more likely than underperformers to strongly agree they’ve integrated their social media activity into their overall marketing strategy (3.4x more likely for integrating email marketing and 5x more likely for mobile marketing). Among high performers who have integrated their digital marketing channels with their overall marketing, at least 95% rate the integrations as very effective or effective.
  • Top marketing teams align with business leadership. The world’s best marketing teams have buy-in from company leaders. As such, marketing budgets are more likely to be prioritised. Eighty-three percent of high performers say their executive team is completely committed to supporting the overall marketing strategy, compared to only 31 per cent of underperformers.
  • Intelligent email is driving higher revenue. As email personalisation capabilities grow more sophisticated, the channel becomes even more integral for marketers to deliver a holistic customer journey. Top teams are 4.2x more likely than underperformers to leverage predictive intelligence or data science to create personalised emails. Forty-nine percent of marketers say email is directly linked to their business’ primary revenue source — a notable jump from the 20% of marketers who said the same in 2015.
  • Social sees massive ROI growth. Last year, three of the top five areas where marketers planned to increase their
    spending involved social outlets. Now, those investments appear to be paying off; 75% of marketing leaders report that social is generating ROI. Top teams are also 1.7x more likely than underperformers to align their social media marketing strategy with other social activities such as customer service, pursuing a more unified customer view.
  • Advertising accelerates on social platforms. Nearly two-thirds of marketers are boosting budgets for advertising on social platforms in 2016, making it the third largest area for increased investment. Among high performers, 80% will increase spending on advertising on social platforms. In order to create a unique experience based on real customer identity, 83% of top teams use customer data (e.g., email or phone data) to segment or target ads

“If we truly put customers at the centre of our thinking — considering how we can make any touchpoint delightful — it changes the way we approach applying all the tools available to us as marketers,” said Salesforce CEO Scott McCorkle.

“It’s not only what we think of traditionally as marketing. It’s also about considering customer support functions, selling functions, community building — every touchpoint. In short, it’s the complete customer experience.”

Top performers

At any conference nowadays there’s no shortage of execs stressing the importance of keeping the customer at the heart of everything a brand does. And it turns out the top performing marketing teams are the ones that have their customer journeys figured out.

While many marketers do pay attention to the customer journeys, it’s the ones who realise it’s an ongoing pursuit and integrate it into everything the brand touches that are rising above.

Tech adoption is widespread among the high performing marketing teams too, with 63 per cent of marketers intending to increase their ad tech in the coming two years, particularly among the internet of things, beacons, podcasts and wearables. And it’s usually the marketers that jump at the chance to try new things that are the ones winning in the tech space.

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Source: salesforce

But you can’t do all this without a solid team and executive endorsement – a commonality Salesforce picked up in the report among the high performing teams.

“Some 83 per cent of high-performing marketers have the executive team’s complete commitment to their marketing strategy,” the report noted.

Which channels are working?

It probably comes as no surprise that mobile is one of the key priorities and performers for the top marketing teams, which includes social media and email marketing.

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Source: salesforce

Some 82 per cent of marketers now agree social advertising is core to their business. It used to only be 27 per cent of respondents who thought social advertising would generate ROI, but in this report that number has increased to 27 per cent.
Download the full report from Salesforce .

This is a modified version of an article that first appeared in Bandt.com.au

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