I must admit it is always gratifying to be right. The recent IPA Bellwether Report shows a clear shift in the way brands are communicating with both customers and prospects, and about time. The market turbulence of the past couple of years would have a lot of sectors running for cover, so it is really encouraging to see the marketing sector defy industry expectations by remaining strong.
The extension of the record run of growth to marketing budgets to four-and-a-half years is great news for the UK marketing industry, indicating the remarkable (if not a tad surprising) health of our wider economy.
Complacency will be costly
While it is genuinely encouraging to witness the resilience of the UK economy, the results should be no reason for marketers to become complacent. The next few years bring considerable uncertainty and we will have to work hard to mitigate the apparent risks in our fragile market. Brexit will rumble on for the next few years and the UK General Election will take place in June. This is not forgetting the almost daily craziness thrown at us by the Trump administration along with other political uncertainties like the outcome of the French presidential election and the rise of the far right in Germany and Holland.
The GDPR challenge
One thing is for sure: the digital sector looks certain to be dealt a devastating blow by the General Data Protection Regulation (GDPR) in May 2018, with consumer consent and privacy now being the first port of call for any communication strategy. Internet and main media advertising have recorded the strongest increases in budgets, but it is interesting to note that direct marketing budgets have increased to the greatest extent for two years. We have long argued that advertisers need to keep their marketing approach omni-channel in order to mitigate events such as GDPR and this most recent research supports this. Consumers have simply had enough of inbox-bombing and have now finally been given the legislative opportunity through GDPR to say ‘STOP!’ And marketers will undoubtedly do so – in their droves.
Customer is king
Consumer centricity will be the way forward for the next decade, giving consumers what they want, when they want it and in the way they want it. Skilled marketers should be able to provide this to their customers in a non-abrasive way, so that consumers do not feel targeted aggressively. The increase in direct marketing budgets looks like the start of marketing propositions becoming more aligned to consumers’ needs, and it is great to see companies waking up to the more personal opportunities that the channel presents for advertisers.
Of course, looking to the future is a bit like looking for a light at the end of the tunnel. We are faced with a number of political and economic uncertainties, therefore advertisers need to stay focused on retention and a return to a lower volume / higher frequency world. Lifetime value will be every marketer’s mantra as margins continue to be squeezed by new market disruptors.
The future looks rosy, but by no means easy.
Mark Roy is chairman of The REaD Group
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