Building a Growth-Driven Digital Marketing Budget for 2022

Performance marketer Incubeta shares insight into how local brands can use their budgets to shift gears and prepare for longer-term growth, including seven tips on how to allocate their expenses in 2022.

Covid has exacerbated tensions between creative-led and media-led strategies

“Over the past five years, some omnichannel companies have shifted their attitude and budgets, shifting spending above the line, particularly television, to digital platforms such as Youtube and other digital video outlets. This was, in part, driven by the tracking and measurability offered by digital channels,” says Julien Fievez, Head of Operations Team at Incubeta.

Fievez says Covid then added new complexity, with media spending taking a big hit in the first wave. This was particularly the case with large retailers, which he said shifted to profitability as a key objective, initially removing budget allocation from upper funnel activities, before adjusting again to meet higher online demand.

“Local marketers don’t invest enough in proper content. When we ask for 40 copy variations, sometimes we only get five. If you think about a user’s journey, it can be complicated and some local brands seem hesitant to invest in good content that grabs attention. This is especially the case in upper funnel content creation and it impacts how we build audiences. Companies will run a TV commercial and we’ll find ourselves trying to turn that content into a Youtube ad. The storytelling on those two mediums is completely different and we’re often forced to do some hacking work to fit budgets that may not have been properly thought out,” adds Brandon Janse van Vuuren, Head of Conversion Rate Optimization and Data Scientist at Incubeta.

Investment in technology drives global performance

By comparison, while many local CMOs have been cautious about investing in martech, the two experts say global companies have pumped money into products like Google Analytics 360.

“The challenge was twofold. The weak Rand has given many executives pause when it comes to investing in martech. Additionally, some executives don’t immediately see a clear return on investment for the technology. However, these tools allow you to look at customer lifetime value over the long term and it is this insight that will set you up for planning success. Local businesses need to take the leap if they want to better understand how users interact with their channels. Investing money today will only produce results down the line, but they will be significant,” advises Fievez.

An uncertain future without cookies

The need for good martech has become all the more urgent as we approach the end of third-party cookies and Janse van Vuuren says that in a world without cookies, premium analytics tools will be what will help sustain marketing performance of a brand.

“We face a very uncertain future and we don’t fully understand what a world without cookies will look like. What we know is that dirty data is useless and we know that first party data will become crucial for marketing. We know data will need to be enabled and audiences will become crucial to future marketing success. When we look at it holistically, it’s clear that’s why investing in marketing technology will quickly become critical,” he says.

Let go of short-termism and obsession with return on investment

Both experts advise that budgets should include more investment in upper funnel strategies, saying these help build first-party audiences and prepare brands for longer-term gains.

Also, a big bugbear for the two experts is when brands commit budget to bringing users to their website, but that’s where it stops.

“There needs to be a mindset shift when it comes to this obsession with ROI, especially when it comes to upper funnel marketing. Getting users to a site is part of the strategy, but getting them to convert is a bigger challenge There is also a reluctance to spend money on web design and CX because you may not see an immediate return but it is a such an essential part of the end-to-end customer experience,” says Janse van Vuuren.

Plan for growth now and in the future

Drawing on work with global and local clients, the two distil their advice into seven quick tips for CMOs planning their spending in 2022:

1. Maintain your omnichannel and keep supporting it
2. Just because people are using online options doesn’t mean there isn’t room for real-world experiences.
3. Research is always important. Paid search and SEO will remain crucial. After all, it will always be necessary to find marks
4. Continue your investment in upper funnel activities
5. Invest with the aim of looking back in the longer term rather than quick returns
6. Invest in the audience. Invest in a good analytics stack and upper funnel strategy to help you with this task
7. Invest in data science solutions. Gaps in your data need to be filled. The calculation of useful metrics such as customer lifetime value will depend on this

Fievez sums up with an analogy highlighting the obsession with quick wins, often at the expense of solid long-term growth, saying, “Digital is often seen as a quick revenue machine, where you put money at one end and a return to the power of X appears at the other end The challenge arises when we try to explain that there are so many moving parts in the machine and less need to focus on what comes out of the machine on a daily basis, and no longer focus on delivery six to 12 months from now.”