Deterioration of the economic climate, inflationary threats, energy crisis, war in Ukraine and new outbreak of Covid in China, the observation is there, projects are shifting and companies are wondering about the right marketing plan to deploy for this year 2023…
Chief Marketing Officers (CMOs) are under strong pressure to demonstrate the effectiveness of marketing investments, as well as their contribution to the company’s business performance. They must deliver results in the short term while continuing to work on the development of the brand in the longer term with results that are more difficult to value. Injunctions that may seem contradictory. However, these two objectives are complementary and must be worked on coherently and simultaneously. Ultimately, the question raised is that of optimizing investments both in terms of objectives and performance.
Back to basics: customer knowledge
Today more than ever, it is essential to know your target customers well. Very powerful new tools and very detailed data are available to better understand who the brands’ customers are. To optimize its investments, it is vital to start with this type of study to design the appropriate messages and creations, which are then declined in a coherent way on the communication and marketing campaigns.
Choose your investments wisely: know your brand
It is then necessary to find the right balance between building the brand and activating sales depending on the starting point of the brand.
A recognized brand that has built trust with its consumers will be able to reduce top-of-funnel investments during this period, and capitalize on its brand to develop sales and loyalty. For example, it can set up loyalty actions by offering gifts to its best customers. This type of action will help create emotion which is the most important force for developing long term sales and growing profits.
Conversely, lesser-known brands will have to continue working on their notoriety to optimize their performance. They will be able to activate “economic” channels on the top of the funnel such as digital, native advertising, influence, social networks. Investments in the brand will then nurture trust and, in the process, improve returns from operations to performance and therefore acquisition costs.
Taking into account the current context: 3 major trends
Building loyalty in an economic downturn
One of the priorities of CMOs will be to devote a larger share of their budget to loyalty, a great classic in times of slowdown or crisis. Indeed, they anticipate a future difficulty in recruiting new customers, with in particular an increase in acquisition costs, and therefore wish to capitalize on existing customers to retain them and develop additional sales.
If loyalty is often seen as a complex project, requiring the long and costly implementation of technological tools, it is often possible to move forward much faster by federating different initiatives already existing in the company within a program. coherent and marketed. Emotional loyalty operations will contribute both to the development of trust and emotion with the brand and to the development of medium-term sales.
Generate point-of-sale traffic in the “Yes Pub” context
The increase in paper costs, 40%, combined with the implementation of “Oui Pub”, namely since 1er September 2022, in several geographical areas in France, the impossibility for retailers to distribute unaddressed flyers in the absence of the “Oui Pub” badge, will force retail players to find new ways to replace this mode of communication and continue to drive traffic to their outlets.
Many distribution brands, and not the least (Leclerc, Cora, Système U, etc.), have announced the partial or total cessation of prospectuses. Many digital solutions exist (CRM base, Presence Management, digital advertising, social networks, SMS, email, etc.) to effectively replace these. These solutions must be arranged between them, according to the communication objectives (common thread communication, promotional communication), the typologies of customers and prospects and therefore, the catchment areas. Their contribution to traffic generation must be measured to optimize device performance and costs over time.
Integrate the environmental issue into its business in a context of changing consumer behavior
Sustainable development is gradually penetrating into society, into the concerns of consumers. In fact, it is increasingly a business issue for companies, even an issue of changing the economic model. Marketing directors will therefore have to gradually integrate this dimension into their products and services as well as into their communication. They will have to imagine a more circular economy where trust will become more important than commitment. For example, a bank or insurer can build loyalty among its B2C customers by offering them vouchers for purchases from its B2B customers, a retail chain can offer discounts, vouchers or experiences in shops or service brands around its points of sale.
The observation is clear: it is essential to achieve optimal arbitration between the various marketing action levers, simultaneously taking into account the knowledge of its customers and its brand, the maturity of its brand and the current context. And if measuring its performance remains immutable for CMOs, nevertheless they must increasingly justify their investments.
It is therefore necessary to set up new methodologies and new means to measure the contribution of the various marketing actions to the development of the company’s business.
About the Author
Claude Charpin, Managing Director of the Dékuple Agency