Six trends in digital marketing in 2021

2020 was not easy, and 2021 will be even harder.

In an environment where the traffic dividend is declining and the market is sluggish, advertisers have to face anxiety and pressure while also finding ways to pursue growth.

Complex and confusing concepts, phenomena, and gameplay began to emerge. In an industry with information explosion, many advertisers were faced with the difficult questions of "whether brand and effect can be integrated" and "how to balance short-term conversion and long-term growth". Advertisers no longer talked about "creativity" and "brand", but instead talked about "conversion rate", "effect", and "sales promotion".

How to get out of the maze and face the more difficult 2021? To help brands see more clearly the current and future industry changes, we have summarized six new trends for 2021.

01

TO C consumer products need to be done with a TO B mindset. In the past, the consumer market was dominated by traditional giant brands; but now, under the new consumption wave, a group of emerging new brands are rapidly seizing the public's attention, capital's favor and the market of traditional brands.

The biggest change behind the success of the new brand is that its approach is very "Internet-based". The "Internet" strategy that is least noticeable to the public is the use of To B thinking.

First of all, To B means that Internet products are aimed at commercial enterprises. Their main task is to provide solutions and services to customers, and the entire service cycle is long. Especially when dealing with large customers, we will carry out extremely sophisticated operations. So To B thinking is essentially customer service thinking.

For To C consumer brands, the customer is every consumer. Brands also need to provide consumers with long-term, refined operations and services in order to tap into the value of retained customers, such as increasing repurchase rates, using social interactive gameplay for fission dissemination, and so on.

In fact, one of the values ​​of the "private traffic pool" often mentioned in the industry lies in this.

At the same time, when To B thinking is introduced, brands actually need to pay attention to and meet consumers' needs at any time with a "service" mentality in every link from product research and development, production, marketing to final sales.

Especially in the marketing link, some brands are currently using user feedback to promptly discover product problems and changes in user needs, and use this to polish and upgrade their products.

Secondly, To B thinking pays more attention to the decision-making role of data and technology, and emphasizes changing products through data feedback and technological upgrades.

The emerging new consumer brands also value data and technology. For example, Yuanqi Forest is building its own digital team and actively introducing external data services. The data team and data service provider are equivalent to "radars". Brands can use data to directly perceive the overall market trends, market share changes, and the actual sales situation of products at channel terminals.

In addition, To B thinking emphasizes value rather than traffic.

Similarly, at this stage in the marketing field, both media platforms and brands are telling stories of long-term growth and value creation. The reason behind this is not difficult to understand. Under the crude method of buying traffic, the purchased traffic is not equal to convertible and retained users, and user growth is not equal to real business growth.

Another point worth noting is that To B thinking also pays more attention to the upgrading of overall strategy and product innovation. Also at the marketing level, the traditional marketing funnel model has become obsolete. Consumers can enter any stage of the traditional purchasing process online at a time and place of their choice, and can also switch seamlessly between various channels and different stages.

Therefore, brands that originally only needed to do marketing in the two aspects of attention and interest must upgrade their marketing to the strategic level. For example, on the front end of marketing, they must not only attract consumers, but also pay attention to data feedback, retention of sales leads, etc.; after advertising, brands must also accumulate content assets and user assets, give play to the long-tail influence of content, and achieve multiple touches and conversions of retained customers.

The rise of the brand is due to the boost of the trends of the times, but it is also related to changes in thinking. Although consumer goods businesses always need to focus on C-segment demand, doing business in the future will require a TO B mindset.

02

Brand advertising also needs to be evaluated for effectiveness, and performance advertising will focus on long-term effectiveness. The marketing industry will be more pragmatic in 2021, and advertisers will increasingly pursue the actual effect of every marketing budget. At the same time, marketing will also be linked to the long-term operation of the brand.

Specifically, brand advertising will focus on effectiveness, while performance advertising will focus on long-term effects.

In recent years, the media environment has been chaotic and there have been widespread claims that the AIPL model is ineffective. This has caused many brands to lose their composure and focus too much on performance advertising when allocating marketing budgets, while neglecting the construction of brand advertising.

But the essence of marketing is actually to discover and meet needs, and the psychological induction of consumers cannot be ignored. The unreasonable allocation of brand advertising and performance advertising will affect the depth of the brand and lead to excessively high customer acquisition costs.

For example, Adidas once wasted 3 billion in advertising costs due to neglecting the construction of brand advertising. This news was like a "wake-up call", waking the entire marketing industry from the frenzy of "advocating" performance advertising and regaining confidence in brand advertising.

Brand owners are increasingly aware that for a brand to "grow healthily", its potential customers should be at different stages of the consumer journey. Only by guiding potential customers step by step, achieving conversion and retaining loyal customers can brand stickiness be guaranteed. Seeking short-term gains is actually false prosperity.

On this basis, in addition to the brand advertising budget that cannot be ignored, advertisers' "ultimate demand for advertising effectiveness" remains unchanged, and the emotional connection between consumers and brands will be one of the performance indicators of brand advertising.

For example, advertisers will have different requirements for the immediate effects of brand advertising based on their marketing goals. From the perspective of covered population, advertisers will focus on examining the proportion of the target user group in the total covered user group.

From the perspective of consumer mind influence, advertisers will have certain requirements for brand advertising to enhance brand awareness and brand favorability, and will regularly monitor public opinion monitoring related indicators such as Baidu Index, WeChat Index, and Weibo topics.

Pure performance advertising will lose its marketing effect once the investment is stopped, and is no longer the first choice for any company that prioritizes growth. In addition to evaluating sales, advertisers will also focus on the mid- and long-tail effects after the launch of performance advertising.

For example: whether consumers who have placed orders are converted into the brand’s private domain traffic, and the consumers’ behavior in the brand’s media matrix after placing an order. In addition, the role of performance advertising is more than just "advertising marketing". If the repurchase rate is too low, the brand owner will reflect on whether there is a delay in the product or subsequent service, which will help the brand owner optimize the supply chain and even the after-sales team.

In general, performance advertising will no longer be a passing phenomenon, but will be responsible for customer operations, private domain traffic, and even supply chain experience and after-sales service systems.

As the transparency of brand advertising and performance advertising marketing effects across different channels increases, brand owners can optimize their budgets in real time and reasonably based on their stage marketing goals, greatly reducing unnecessary waste and improving the efficiency of brand marketing strategies.

03

New brands are taking off, and will next face the challenge of moving from "Internet celebrity brands" to "national brands". This year, the new consumption track is extremely hot. A large number of new brands, including Perfect Diary, Yuanqi Forest, Zihaiguo, Ramen Says, and Wang Baobao, have rapidly grown into "Internet celebrity brands", and their explosive volume and speed of rise are astonishing.

After becoming popular, these brands will next face the challenge of evolving from “Internet celebrity brands” to “national brands”. The reason why it is called an "advanced challenge" is mainly because becoming a "national brand" is not an easy thing.

From the product perspective, this group of new brands have all hit the unmet niche demands in the market, starting from the cracks between traditional giants and vertical segments of product categories.

Due to the small size of the incision, the popular products of new brands are likely to encounter a growth ceiling. It is difficult to have long-term development if they only focus on one category. At the same time, Internet celebrity brand products generally lack barriers and are easily copied by competing products after they become popular. Once the brand marketing efforts weaken, they may be replaced by competing products.

From the perspective of marketing methods, spending money to generate traffic is a common strategy used by internet celebrity brands. However, this strategy will lead to problems such as increasing traffic prices and increasing brand purchase costs during the current period when the dividends are fading, making it difficult to increase profit margins. At the same time, the marketing effect of the buying volume method disappears as soon as it is stopped, and how to achieve retention remains a problem.

Another major difficulty is that building a "national brand" is not a process that can produce results in the short term and whose results can be clearly measured. Without timely feedback, it is difficult for companies to evaluate whether their actions are correct after they have taken action.

In the industry, brands have different understandings of this and take a variety of actions. It is difficult for new brands to find mature methodologies in new trends.

In view of the above difficulties, new brands can start from three aspects in the next year:

1. The first step is to change consumers’ perceptions and increase their recognition and trust in internet celebrity brands. In specific operations, on the one hand, it is necessary to continue to do a good job of quality control to avoid the occurrence of negative events; on the other hand, it is possible to endorse the brand through celebrities with higher "status" and platforms with higher "national recognition", thereby improving the brand level and expanding the target consumer group;
2. Secondly, attach importance to the value of hard advertising and brand advertising. New brands often rely on Internet celebrities, KOLs/KOCs, but at this stage consumers are clearly aware that "content seeding" is a form of "brand inducement", and therefore are prone to rebellious psychology. Moreover, large-scale and concentrated advertising will over-raise consumers’ expectations, which will easily lead to psychological gaps after purchase and fail to build brand reputation.
3. In addition, to become a national brand, Internet celebrity brands must be prepared for long-term construction. The word "national" itself contains connotations such as brand history and reputation, which require the brand to spend time accumulating and settling. At the same time, brands also need to reuse their existing advantages and expand product categories horizontally, so as to break the problem of small product incisions and growth ceilings.

04

The organizational structure and management model of the marketing team are facing greater challenges, and the learning pressure on CMO and CGO is unprecedented. As a standard for modern companies, CMO is one of the most critical executive positions besides CEO, COO and CFO.

But one obvious change is that in recent years, a number of major brands including Coca-Cola, McDonald's and Colgate have transformed CMO (Chief Marketing Officer) into CGO (Chief Growth Officer). Even though some big brands have not abolished the CMO position, they have still established a CGO early on and placed the CMO under the jurisdiction of the CGO.

Changes in positions have always been to adapt to different eras and business needs.

In the era of digital marketing , traditional marketing methods have become difficult to help companies drive performance growth. CMOs who are accustomed to traditional marketing operations find it difficult to keep up with their understanding and execution of digital marketing. Therefore, the company must find executives who can take on more responsibilities, including performance growth.

At the same time, the market growth of existing products of many mature and large brands has reached a bottleneck, and developing innovative products to attract consumers has become a compulsory course for corporate business transformation. This requires companies to master how to quickly drive the growth of new products, but CMOs in traditional marketing models do not have this skill.

As the name suggests, the responsibilities of CGO are directly related to performance growth. Sean Ellis, who proposed the concept of CGO, also gave a clear positioning - CGO needs to have two major functions. One is to continuously drive service optimization and experience upgrades through product innovation. The second is to continuously improve efficiency and adjust the direction of products and services through rapid trial and error.

Obviously, the company has higher requirements for CGOs: not only should they be responsible for marketing and brand building, but they should also understand products, markets, data and growth strategies. Regardless of whether the company replaces CMO with CGO or the CMO is fully responsible for all tasks after the upgrade, the learning pressure is quite high.

In addition, changes in positions will inevitably bring about changes in the organizational structure and management model of departments and teams. When the CGO needs to take into account product innovation, data performance and growth strategy, the existing innovation, product development and data technology departments will be directly linked to the CGO.

For example: When Coca-Cola cancelled the CMO in 2017, it directly divided the above departments into unified management by the CGO. At the same time, it also established a new CIO (Chief Innovation Officer) who reports directly to the CEO together with the CGO.

The new organizational structure is clearly aimed at achieving a leaner, more flexible and more collaborative working model to ensure the company can adapt to rapidly changing consumer needs. This is bound to bring greater challenges to the marketing team.

05

Entrepreneurial projects that focus on the marketing track itself will be sought after by capital, and veteran entrepreneurs will be given special treatment. In the past, "half of the advertising budget is wasted, but no one knows where it is wasted" is the most famous difficulty in the marketing industry. What is reflected behind this is the actual situation that advertising is not accurately placed and it is difficult to track the effect after placement.

Today, the most powerful tool the industry is working to change this situation is digitalization.

In the era of digital marketing, data and technology are not only basic tools for brands to improve the efficiency and conversion of advertising, but also a "weapon" to help them accumulate data assets, user assets and private domain matrices, while further realizing efficient, transparent, intelligent and automated marketing across the entire chain.

For this reason, entrepreneurial projects focusing on the marketing track itself, especially those providing data analysis management and marketing intelligence technology services, have begun to be sought after by capital.

This year, many such entrepreneurial projects have received financing. For example, Minglu Technology, which completed a US$300 million Series E strategic financing in March, mainly uses big data and artificial intelligence technologies to build a data middle platform and marketing intelligence platform, emphasizing the provision of end-to-end services, full life cycle services, and data security and data privacy protection technology systems for customers.

KuaiJuce, a customer experience management (CEM) technology platform and service provider, received RMB 80 million in Series B financing in October this year. Its main business is to automate and intelligently meet the research needs of corporate users through technology.

In addition, there is Convertlab Marketing Laboratory, which focuses on the marketing cloud track and launches marketing cloud products that serve B2B companies' omni-channel customer acquisition and conversion; Fourth Paradigm, an artificial intelligence technology and service provider that launched the Tianshu Digital Intelligence Operation System; and Chuanglue Technology, the country's first customer data middle platform (CDP) solution service provider, etc.

Of course, the premise of combining emerging technologies with marketing scenarios is to have a very clear and in-depth understanding and insight into the marketing industry itself, which also makes the "veterans" in the marketing industry particularly favored and favored when they start their own businesses.

For example, Wu Minghui, the founder of Minglu Technology, is a serial entrepreneur. Since 2006, he has founded two artificial intelligence and big data companies. One of them, Miaozhen Systems, is currently a leader among third-party marketing technology companies.

Li Shaohui, the founder of KuaiJuce, worked in brand marketing at Procter & Gamble for many years, and then started several businesses in the marketing field. As the Series A investor, Saiyi Industrial Fund has clearly stated that the reason it is optimistic about KuaiJuece is that its founder has many years of experience, his self-evolution speed is very fast, and his united front capabilities are also very strong.

06

The upstream and downstream industries have put the issue of data privacy on the agenda, and reasonable solutions will become the way out. In recent years, issues related to data privacy legislation in various countries have once again become the focus of global attention.

At present, different countries and regions have different legislative standards regarding data privacy protection. Europe uniformly implements the GDPR, while the United States includes the CCPA that has already come into effect.

In China, the "Information Technology Regulations" and the "Information Technology Act (Amendment)" both have relevant provisions on the protection of personal information, and relevant bills such as the "Data Security Law" and the "Personal Information Protection Law" will also be introduced in succession.

In June this year, Apple announced rules to restrict the collection of its free universal commercial identifier IDFA, which caused the entire Internet industry to fall into great panic.

Even though the policy will take effect in 2021, giving developers more time, it will make it difficult to achieve audience targeting, conversion attribution, and precise targeting of advertisements in the iOS14 system. This shows that strengthening data privacy protection has become a major global trend.

Although my country’s data privacy protection measures started later than those in Europe and the United States and the relevant regulations are relatively loose, upstream and downstream companies in the marketing industry still need to plan ahead and prepare for increasingly stringent privacy regulations in the future.

Especially in today's environment where traffic dividends are gradually reaching their peak, precision marketing is becoming more difficult, customer acquisition costs are rising, and user retention is not easy, companies can only continue to grow in a difficult environment if they take the initiative to change.

Under the general trend of digital transformation, enterprises can focus more on building a data middle-office system, accumulating private domain traffic mainly based on the company's first-party data, and carefully select leading Internet platforms or third-party suppliers for data cooperation, so as to give full play to the value of data and assist marketing decisions under the premise of compliance.

In addition, companies can also choose to seize the initiative and continuously improve their technology to ensure data compliance without affecting precision marketing.

For example: In response to Apple's complete blocking of third-party cookies, The Trade Desk launched the Unified ID 2.0 initiative globally, which aims to replace disabled third-party cookies with encrypted emails. LiveRamp, Criteo, and Nielsen have already joined, and the multiple parties are working together through technical collaboration to support the normal use of Unified ID 2.0.

Conclusion Hot topics will always become outdated and the industry is always changing.

At a time when traffic is becoming increasingly difficult to obtain and competition is becoming increasingly fierce, paying more attention to conversion and growth is an inevitable choice for advertisers. The evolution from temporary conversion to long-term growth is also an inevitable trend.

Standing at the end of 2020, we can be the first to see the new trends in 2021 and understand the underlying logic and rules. I believe this will help advertisers and marketers avoid detours.

Author: Lü Yue, Rui Ling

Source: New Marketing Engine