Data-driven brand marketing 'set to be key in 2023'

Marketers looking to survive – and even thrive – in the coming 12 months are being urged not to leave anything to chance by maintaining spend, especially on data-driven brand marketing, while embracing insight to accelerate an omnichannel strategy.

That is according to Analytic Partners’ latest ROI Genome Insight Report, which offers guidance to marketers to prepare for shifting market conditions and capitalise on opportunities to optimise brand performance in 2023.

Using data from ROI Genome – a dynamic dataset of millions of marketing and measurement metrics from 50 countries and 1000+ brands – Analytic Partners’ latest ROI Genome Insights Report identifies the five strategies deployed by those brands that have historically thrived in economic situations similar to what is predicted for 2023.

According to the analyses of hundreds of billions of pounds’ worth of marketing spend, 80% of brand messaging outperforms performance messaging, and dominates as the best long-term strategy to win over customers and their loyalty in a tumultuous era of high inflation, job insecurity, and economic volatility.

Meanwhile, 30% of paid search is driven by, and directly attributable to, brand and upper funnel marketing, while another 30% to 60% is driven by non-marketing factors such as seasonality, loyalty, or category trends.

The analysis highlights that increasing marketing spend during economic downturns has yielded positive ROI growth in back-to-back years, and 17% growth in incremental sales for 63% of brands.

If organisations are planning to reallocate marketing spend, the data indicates that a pivot from lower-funnel (ie pay-per-click, measured through conversions, or price cutting and discounts) to the ‘upper funnel’ marketing activities (ie video, social media, SEO) will build stronger emotional engagements with consumers and ultimately foster more loyalty, advocacy, and conversion.

Overall, upper funnel tactics, while only 25% less effective in the short term compared with lower funnel tactics, were found to be 60% more effective over the long term in all market conditions.

In addition, the report offers insights on how to best develop marketing strategies to position businesses to achieve their goals for 2023.

These include capping performance marketing spend at no more than 50%, so that at least half goes to brand and other upper funnel marketing activities.

Meanwhile, brands are being advised to capitalise on the power of targeting. Nearly 75% of sales generated by marketing come through media channels that enable a targeted approach.

Companies should also take an omnichannel approach. Spending on connected TV (CTV) has reaped a 30% stronger return on investment than other advertising spend.

And, finally, firms should invest in every customer touchpoint to track real-time data and make truly informed business decisions.

Analytic Partners president and CEO Nancy Smith said: “As we enter a new year of economic uncertainty, consumers are feeling the pressure on their purchasing power, while marketing teams are facing increasing demands to reduce spend.

“Yet, this decision to cut can incur a 15% loss of business for companies that reduce marketing budgets when their competitors do not. Achieving success in 2023 will require brands to channel resources towards marketing activities that emphasise brand marketing and measurement of omnichannel touchpoints that lead to long-term impact.”