Customers have a high expectation of personalisation when it comes to marketing. The challenge is that they must provide personal data to receive the personalised marketing they expect.
BRAND CHALLENGES IN 2023
With the end of 2022 rapidly approaching, it is an excellent opportunity for us, in our roles as marketers and content managers, to think about the landscape we will face in 2023 and how we can prepare for the challenges of this new year.
Often in our roles, we are so busy dealing with the current challenges and deadlines that we do not have the time or energy to reflect on how to best prepare for and manage upcoming challenges. Many of the challenges we will face are a continuation or growth of the current problems we are dealing with.
CURRENT CHALLENGES
A recent review by Salesforce found that marketers and brands face the following challenges.
- According to 71% of respondents in the survey, meeting customer expectations is more complex than a year ago [1].
- The increasing impact of technology and how to use it effectively.
- Balancing the impact of technology, personalisation, and customer privacy.
Contributing to these challenges is the staff shortage for many organisations in their marketing and customer engagement sectors which contributes to problems in using technology effectively.
CUSTOMER EXPECTATIONS IN 2023
INCREASING EXPECTATIONS OF PERSONALISED MARKETING
Customers now have a high expectation of personalisation when it comes to marketing. Accenture reports that 91% of consumers are more likely to shop with brands that provide offers and recommendations that are relevant to them. And Epsilon research reveals that 80% of consumers are more likely to purchase a brand that offers personalised experiences.
In response to customers’ expectations, marketers and brands focus on personalising customer interactions. Everything from emails to product recommendations to in-store and online experiences. SmarterHQ reports that 51% of digital marketers say that personalisation is their number one priority and personalisation techniques.
The challenge, however, is that customers often need to realise that they must provide personal data to receive the personalised marketing they expect. This creates several challenges for businesses. Customers often are reluctant to share their data, so companies need more information to do the personalised marketing the customer is seeking.
There is also the cost to businesses in storing personal data and the risk to brands if data is lost in a cyber-attack, as in the recent cases of Optus and Medicare. As cyber-attacks become more frequent and sophisticated, businesses need to weigh the cost-benefit of the increasing costs of cyber insurance and protecting data versus obtaining customer data.
This is one of the ongoing challenges for businesses in 2023.
Where customer data is being collected, it is essential for businesses to clearly communicate with clients the following.
- Make sure customers understand why data is needed and what they get in return. If customers can’t see the benefit — businesses need to rethink what they are doing.
- Clearly articulate and demonstrate to customers how their data is being used to create a more personalised and better customer experience.
- Make sure your business uses the data you collect to meet customer expectations.
- Ask for feedback — and keep asking for it. Customer feedback is critical for keeping you on track and meeting changing customer expectations [2].
THE EXPECTATION ORGANISATIONAL VALUES WILL BE CLEARLY EXPRESSED
Customers also expect transparency from the companies they buy from. According to the survey, 88% of customers expect companies to state their values clearly. Adjusting to this shift in customer expectations is effective, as 93% of high-performing marketers say their external messaging reflects their corporate values, compared to 70% of their underperforming competition [4].
THE INCREASING IMPACT OF TECHNOLOGY IN 2023
Technology is becoming more critical. However, the impact of inflation and companies having to pay more to attract employees means businesses may reduce spending on technology resulting in marketers having to get more out of their existing tools and technology rather than being able to invest in new technology.
The review by Salesforce [5] outlined the top five priorities and challenges for marketers using technology as being:
Research reveals that 80% of consumers are more likely to purchase a brand that offers personalised experiences
- Improving the use of tools and technologies
- Experimenting with new marketing strategies and tactics
- Modernizing tools and technologies
- Building/retaining trust with customers
- Improving collaboration
- Ineffective use of tools and technologies
- Measuring marketing ROI / attribution
- Balancing personalisation with customer comfort levels
- Building/retaining trust with customers
- Resistance to new marketing strategies/tactics
The challenges of balancing personalisation with customer comfort levels and building and retaining trust have been discussed above.
MINDSET AND TECHNOLOGY
The challenge with improving the use of tools and technology often comes down to mindset. It is very easy to fall into the trap of thinking that new technology will solve the problems marketers and businesses face. However, new technology with an existing mindset only sometimes results in an effective solution.
The ineffective use of tools and technologies is often not the problem of the technology or the tool but with the user and their view of what they can and cannot do with the technology. In many companies, technology is often under-utilized because of the mindset of the users.
INCREASING USE OF AI (ARTIFICIAL INTELLIGENCE)
An increasing number of marketers are using AI tools. In 2022, 68% of marketers say they have a fully defined AI strategy, up from 57% in 2020 [6]. In 2023, the number of businesses using AI will likely continue to increase, particularly around the following three areas.
- Automating customer interactions
- Automating data integration
- Personalizing the customer journey across channels [7].
PRIVACY CHANGES AND THE COOKIELESS FUTURE
While the decline of third-party cookies continues to be pushed back, businesses are preparing for the new future by pivoting to data given freely by customers (zero-party data) and data companies directly collected from customers (first-party data) [8].
In preparing for privacy changes, many marketers have taken the following steps.
- Providing information-sharing incentives for customers: 56%
- Creating a first-party data strategy: 54%
- Creating second-party data-sharing agreements: 52%
- Investing in new technologies: 51%
- Reducing internal data silos: 49%
This enables marketers to engage the right customers more effectively and maximise marketing dollars.
Marketers and businesses need to incorporate more inbound marketing strategies and offer value through content and digital experiences in exchange for customers’ consent to use their data.
Many of the challenges faced by marketers and businesses in 2023 will be an extension of the challenges faced in 2022. Challenges will be exacerbated by rising interest rates, an ongoing shortage of skilled staff, and the need to pay higher wages to attract staff with the necessary skills.
Given these challenges, as 2022 ends, it is an excellent opportunity to review and think about the following questions.
- How do we develop an innovative and creative mindset that allows us to use our current tools and technology to its fullest potential?
- How can we communicate more clearly with customers about why their data is essential if we are to create personalised services for them?
- How are we managing the risk and responsibility of storing customer data? Do we have policies and procedures to cover insurance risks and cyber-attacks?
- Are we using AI as effectively as we can in automating what we can, so we are free to engage with customers and clients?
[1] https://www.searchenginejournal.com/marketers-struggling
[2] Consumer expectations on personalization - Microsoft Advertising
[3] https://www.searchenginejournal.com/marketers-struggling
[4] https://www.searchenginejournal.com/marketers-struggling
[5] https://www.salesforce.com/blog/marketing
[6] https://www.searchenginejournal.com/marketers-struggling
[7] https://www.searchenginejournal.com/marketers-struggling
