In a survey conducted with 50 chief economists from all over the world by the World Economic Forum, the outlooks varied on whether the growth of economies would be the same, moderate or higher. Only 37% of those surveyed felt that the US economy would grow moderately; this goes as low as 14% in Central Asia, 61% in East Asia and the Pacific region, 66% in China and 47% in the sub-Saharan African regions.
With a forecast that seems as uncertain as this, it is natural that marketing and advertising budgets across sectors are beginning to tighten their purse strings. Alphabet Inc, parent company of Google, increased their advertising revenue marginally, while another giant, YouTube, increased their budget by a minuscule 2%. Snap too found that their revenue growth was decelerating and that their advertising partners from across sectors were lowering their marketing budgets, particularly in view of current economy statuses, inflation-related pressures and increasing capital costs.
Despite this, companies are learning to adapt quickly, just like they did in the face of the pandemic. Organizations, both large and small, are shifting budgets to digital marketing with metrics that are easier to track and allow for a wider range of prospects.
This brings us to Salesforce’s marketing outlook for 2023. In its 8th Edition of the State of Marketing Report, the company drew its findings from a survey of over 6000 marketers spread across 35 countries. The report says that marketers are mostly optimistic with as many as 87% finding more value in their work than a year ago. They have also invested in expanding their marketing horizons. Top strategy shifts include:
- Targeted new customer segments
- Investment in collaboration technologies
- Investment in virtual and hybrid events
- Changed business models
- New product fulfilment options
In all of the above cases, more than 60% of respondents felt that these new strategies are here to stay despite the looming downturn of the economy. As you can see there are two different perspectives at play here – one which sees a more restrained hand on marketing budgets and another which sees investment in newer possibilities.
Now for the details…
1. A Shift in Allocation of Marketing Budget
There is optimism in meeting 2022 marketing goals amongst marketers before the year ends, but there is also the understanding that marketing budgets will be reduced. Integrate, along with Demand Metric, published “The State of Marketing Budgets” report. The research statistics in this report indicate that almost a quarter of marketer respondents believe their budgets will be reduced in 2023.
While this may be the case, it is interesting to note where marketing dollars are being invested. The same report says that in 2023, as high as 54% of marketers will use their budgets to focus on quality content creation and strategy. This will include customer marketing. There will be a similar focus on digital initiatives. Approximately 47% of those surveyed want to use their budget to invest in marketing operations and related technology.
2. Let’s Look at Advertising Budgets
According to the State of Marketing Report by Salesforce, advertising takes up the bulk of budgets for both B2B and B2C. As mentioned earlier, there are signs of advertising spending being reduced with Alphabet, YouTube and even Meta’s average revenue showing a downward trajectory. The cutbacks are primarily driven by possible reduction in demands. But there is no uniformity across sectors in which such cutbacks are occurring.
With the advent of cookieless advertising in 2023 (reduced abilities to track consumers, access contact details and predict their purchase patterns), advertising spends are going to move in a different direction. Other determinants will also include the constantly changing tools utilized in planning campaigns and technologies too.
3. Working with Fluctuating Conversion Rates
The goal of digital marketing is to create interest and convert leads. However, there is a drop of 7.13% in conversion rates. This is a clear indicator of consumer hesitancy to spend as fears of recession surface. Some of the possible solutions that we may see are businesses moving towards softer conversion points such as more sign-ups for an email list or better engagement on social media. From a Salesforce perspective, creating more engaging user experiences has been on the rise. The ability to personalize interactions with Salesforce tools like Interaction Studio also helps.
4. A Sync in Tech Stack In Place of Multiple Platforms
Observers of the marketing cloud and its operations believe that in 2023 we are going to see functionality take higher precedence. Rather than have a mix of multiple platforms in a tech stack, extensibility and integration are going to gain prominence.
Extensibility is about getting more from your existing tech stack and with the ideal approach to integration, you can remove any inefficiencies that exist. This will help with faster aggregation of data from numerous sources and effectively reduce manual approaches.
Extensible orchestration has been a catchphrase in Salesforce marketing for a while now. What it essentially means is that extensibility makes room for newer capabilities and functionalities to be added on, and orchestration is how the proper planning and coordination ensure that various elements work together effectively.
Extensible and Orchestration works together in the context of Marketing Cloud and Pardot (which handles account engagement). With this, marketers can coordinate elements such as multiple data sources, content flow, workflows of their teams and work channels. This helps them achieve the task at hand, which could create an individual profile or create actionable data. Elements can be added to the flow at any point with no disruption. Some of Salesforce’s offerings in this are the Pardot API v5 which comes with newer endpoints with each release, Marketing App Extensions, with External Activities, and External Actions, and the ability to send out multiple kinds of emails with Email Content object.
5. Methods of Personalization
In the year to come, marketers will have to adapt to the changes in privacy regulations and data transparency. There will be a thin line between personalization and privacy for organizations to navigate. With cookieless advertising almost here, marketers are going to switch to a well-rounded strategy for first party data. Salesforce’s Genie and Pardot will help with advertising partnerships, account engagement and cookie tracking respectively. In a bid to prep for a cookieless future, the 8th edition of Salesforce’s State of Marketing report says that:
- 56% of marketing departments plan to offer information-imparting incentives for customers
- 54% look forward to create a first-party data strategy
- 52% plan to create second-party data-sharing agreements
- 51% are keen to invest in new technologies
- 49% plan on reducing internal data silos.
Naturally, quality personalization is possible with a wide range of aggregated data sources. Here is a look at data source diversification by marketing organizations. According to the Salesforce State of Marketing report (8th edition), transactional data will account for 83% of data sources used by marketing organizations. 83% will use known digital identities, 82% declared interests, 77% second party data and an equal percentage will refer to inferred interests. 75% will explore third-party data and anonymized digital identities, 69% will look at offline identities and 58% at non-transactional data.
6. Creating Customer Data Platform (CDP) and Working on Profile Unification
In line with the previous point, being able to create a solid foundation for personalization comes from deriving data from diverse sources. Data sources continue to grow each year. Matillion and IDG Research recently worked on an IDG MarketPulse survey titled Optimizing Business Analytics by Transforming Data in the Cloud. The survey concluded that an organization used a mean figure of 400 sources of data. Over 20% of surveyed companies said they drew their data from over 1000 sources to power their Business Intelligence and analytics systems.
The Salesforce report says that more than 31% of marketers found account-based marketing (ABM) hard because of the lack of a unified customer data view. A Forbes report found that 95% of businesses felt that managing unstructured data posed a barrier to their business functioning – a problem associated with B2C marketing, it is increasingly being seen in the B2B sector as well. As a marketing trend, Salesforce’s Genie is now a part of its Marketing Cloud suite. Pardot has been rebranded as ‘Marketing Cloud Account Engagement’ in an attempt to bring together all of Salesforce’s marketing offerings. Such integrations may be the way forward in 2023.
7. Working on Real Time Insights
The concept of real-time got quite real in the latter half of 2022. There has been an increase in the number of data sources that an organization utilizes. A BI-Survey found that 18% of companies relied on over 20 or more internal sources of data and 13% on external sources. 40% of organizations used fewer than 5 sources of internal data sources with as much as 56% of external data sources. With such an increase, marketers need to track several more metrics per year, across their systems. Being able to gain speedy insights is an essential advantage. A recent McKinsey article said that companies that leverage behavioral insights quickly are likely to witness an 85% growth in sales and over 25% growth in margins.
The speed of gaining insights is going to be the focus in 2023. Experts believe there is still ways to go before the gap can be reduced between collecting data and gaining insights from it rapidly. While a part of it will depend on the technologies used, a more significant requirement will be bringing everyone in the organization on the same page and ideal data governance.
8. Implementing Web3 strategies
When Salesforce announced its NFT Cloud, the brand emphasized security, privacy and sustainability, three elements that were at the heart of NFT’s Cloud design. With this offering, Salesforce has set a gold standard for any company looking to explore Web3 technologies (third generation of web technologies). The market capitalization of Web 3.0 is currently estimated to be $27.5 billion. 2022 was the year when around 46% of financial apps would have made the move to Web3 technology. 73 million games today use the same tech. With Web3 tech, block-chain games increased by over 2000%. The North American region is currently the largest market holder of Web3 with a 34% share. 2023 will be quite interesting to observe how Web3 performs.
9. An Increase in Demand for Skilled Marketers
According to The State of Martech 2022-23, over 65% of respondents felt their company was subpar when it comes to people and teams and the necessary abilities to deliver marketing technology initiatives. There is a clear lack of skill set needed in data, technology and analytics. 72% of the respondents felt that getting the right marketing talent is more the need of the hour than technology.
There is a massive lack of skills needed to use new technological tools well. The fields of marketing operations, analytics and even the use of Salesforce in marketing are still considered relatively new as far as specializations go. After the pandemic, with the onset of The Great Resignation and the volatility of the market, more organizations will look at investing to retain their employees and empower them in 2023.
10. An Increase in Marketing Collaboration and Related Technologies
After the pandemic, it is clear that the flexible model of working is here to stay. The good news is that with the right collaborative efforts and technologies, marketing teams have functioned quite effectively. According to Salesforce research, an organization has an average of four collaborative technologies that it uses and almost 70% of marketing heads believe this investment will be a permanent one for them. Collaboration has now become a key investment to help improve growth trajectories.
Slack, from the Salesforce stable, has completely reworked the way marketers operate. It was made available as part of the Salesforce Marketing Cloud in 2022. Industry observers, as do Salesforce professionals, believe that Slack connectivity will be adopted at higher rates in 2023.
With this, we have unwrapped 10 Salesforce Marketing Trends for 2023. It is safe to say that with the volatility and uncertainty in markets, not every economy can be considered the same. Similarly, not every industry and region functions on the same observations. In 2023, organizations will increasingly work on smoothening out any inefficiencies in their technology, and the collection and processing of data. They will look at developing their expertise across technologies relevant to their organizations too.