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2016 ended with Americans exhausted by emotionally wrenching politics, stories of foreign entanglements and violence at home. Businesses, too, have struggled with modest economic growth and a turbulent stock market. As 2017 begins we all, consumers and organizations alike, face uncertainty in a variety of arenas.
With this as backdrop, businesses still have to develop, plan and execute strategies for profitable growth. After speaking to various colleagues and clients, and reading the comments of a number of pundits and prognosticators, here’s my take on what’s in store for small and midsized B2B and B2C businesses in the coming year:
1. A significant number of marketers – both large and small – will conduct agency reviews in 2017. The current report from Advertiser Perceptions (based on 420 marketers representing about 90 percent of the Top 100 US advertisers) reveals a staggering number of planned reviews:
· 66% plan creative agency reviews;
· 65% plan to review search agencies;
· 64% plan to review media agencies;
· 61% plan to review digital agencies.
Why? Beyond the lack of trust in authorities in society as a whole, rightly or wrongly trust has also been lost between marketers and their agencies. So if you’re feeling concerned about your agency relationship, recognize that you’re not alone.
2. There will be major increases in the number of companies hiring “contingent workers”, i.e., independent contract workers and freelance specialists. Faced with rises in the minimum wage, increases in healthcare costs and increasing payroll taxes, companies are obviously doing everything they can to cut their fixed labor costs. But the ability to hire top notch talent for the short or long term is also a practice gaining much momentum. In fact, a recent survey by Deloitte University Press showed a “7 percent significant increase” plus a “44 percent increase” in planning to hire contingent workers in the next few years.
Keep in mind that these “outsiders” bring fresh energy and fresh ideas to any type of organization while also perhaps providing some savings to your bottom line.
3. Media fraud and ad blocking will increase in 2017. Much was uncovered by the Association of National Advertisers’ eight month investigation of undisclosed rebates flowing from digital media companies to agencies. However, there’s incentive for fraudsters to keep doing what they’re doing because of the ability to circumvent fraud detection systems. This widespread practice can influence agencies’ media recommendations (and bottom lines), while obviously not being in the best interests of clients.
Perhaps more importantly, the stunning growth of ad blocking across markets poses a huge threat to digital media. At least 419 million people worldwide are blocking ads on their smartphones, nearly twice the number blocking on desktops. That’s 22 percent of the world’s 1.9 billion smartphone users (PageFair – Ad Blocking Goes Mobile).
Digital and mobile media aren’t going away but using them effectively is challenging. Find trusted professionals to make sure you get what you bargained for.
4. As customers and supporters are the life blood for any business or nonprofit, organizations will need to significantly increase their efforts to gain insight into their real world wants and needs. A recent McKinsey & Co. study of about 700 senior executives concluded that: 1) only 6 percent of companies felt they understood the needs of their customers extremely well; and, 2) seventy-two percent considered customer insight budgets inadequate.
There has been an explosion in the amount of customer data available, with new software programs mining all sorts purchase and opinion information, including social media. To be competitive, organizations will have to keep expanding their knowledge using this new information. It just doesn’t seem smart to even consider developing a targeted strategy or plan without knowing your customers, so make sure you have the skills to obtain and interpret the right information.
5. Developing and maintaining a positive customer experience will become the new king of marketing. Distrust of institutions appears to be rampant — products are recalled, passwords are stolen, on-line tweets have as much credibility as government agencies. Starting with employees, make sure they have the knowledge and tools to better serve the customer, create a positive experience, and champion repeat purchase and customer referrals.
Trust is the new black. All aspects of a brand’s life should convey trustworthiness, consistently delivered in a believable manner, at every touch point.
6. The acceptance and use of direct mail by millennials will continue to explode. Yes, millennials. And, yes, snail mail. This demographic is the most likely to open and read direct mail. In fact, 63% reported that they made a purchase based on a direct mail piece they opened within the last 3 months (Info Trend Study of direct marketing in the US).
Perhaps their inundation with spam, interruptive advertising and meaningless content leaves them tired of looking at screens and searching for a “new” medium. After all, it’s not about technology; it’s about effectiveness.
7. While media spending on the Internet will tie with television for the largest expenditures in 2017, more marketers will recognize that the majority of major media spending is still accounted for by traditional media (65%). Television spending will increase by 1 percent, out of home by 4 percent, as radio remains unchanged and only magazines and newspapers will show declines (by 5 and 9 percent,respectively). Additionally, the Marketing Services category will increase by 2.8 percent to $237 billion, as led by sales promotion, telemarketing, direct mail and event sponsorships. (Advertising Age)
It goes without saying that determining where to spend your marketing communications dollars is becoming more complex. The key to doing so successfully is understanding the difference between selecting the newest “efficient” tactical tool, and selecting the most “effective” one. This becomes increasingly important for small businesses, who can’t afford costly mistakes.
8. Considerably more time and smart thinking will be put into the development of marketing and marketing communications strategy, positioning and planning. A “Meaningful Brands” study by Havas in 2015 reported that most people wouldn’t care if three-quarters of all brands disappeared for good! Further, most brands haven’t updated their strategies to meet today’s Internet-enabled buyers. These buyers have access to vast amounts of information and have a plethora of purchasing options at their fingertips. It’s more vital than ever that in order to survive, you must continue to keep your brand meaningful to your constituents.
Both for profit and nonprofit brands must make it absolutely clear how they differ from competition, and make their value proposition completely believable at every opportunity. Once your plan is implemented, you must also know what’s working and measure everything.
Value Marketing And Marketing Communications Consultants
2017 brings a considerable number of unknowns and concerns facing your customers, prospects and even your employees. They clearly are more cautious about what to believe and who to trust in the year ahead. All organizations are faced with these issues and the dilemma of how to have a successful business in this climate.
Many small and midsized organizations are partnering with established and independent senior level consultants to help them with marketing and marketing communications budgets, and plans – evaluating, developing, refining and, if appropriate, implementing. If this is something you might consider, look for people with broad B2B, B2C and nonprofit experience across industries and brands. Seek out consultants who are media neutral and aren’t selling one particular discipline. And make sure they’re passionate about analyzing results and willing to “tell it like it us”, so candor will flourish.
Improving profitable sales and marketing communications ROI is a daunting task. Finding the right consultant to partner with you might take some looking, but as Yogi Berra said, “When you come to a fork in the road, take it.”