The 2020s have taught us that there’s no such thing as “the next normal.” While the onset of 2022 predicted it to be the year of the “YOLO Economy,” unsurmountable economic pressures instead caused it to be the year of the “NOLO Economy”—No Longer Optimistic.
The Russia/Ukraine conflict’s impact on energy costs continues to put pressure on the economy; the Federal Reserve’s reaction to domestic inflation has demand and supply orders shifting; and the market downturn has wiped out trillions of dollars in capital, which has caused historic inflationary rates that are eating into consumers’ wallets. As a result, consumers are yet again changing their spending habits. In fact, in a survey of thousands of people across North America, Zeta found that 34% are spending on necessities and little else.
This environment has created the perfect storm for Chief Marketing Officers: unpredictable macroeconomic forces, consumers pulling back from spending, and a slew of budget and resource cuts. But as Machiavelli once stated, “Never waste a good crisis.”
As their company’s assumed “Chief Growth Officer,” CMOs are expected to continue driving demand by adopting a scrappy operating model and achieving the same goals with less budget and fewer resources. However, by eschewing the notion of “scrappy” and instead embracing more “sophisticated” marketing, CMOs will be able to get more from less. By prioritizing efficiency with their technology stacks, high-value audience targeting, and having a deeper understanding of consumer signals, behaviors, and intent, CMOs today have the opportunity to create better experiences for consumers and deliver higher return for their marketing programs.
How can CMOs thrive during unpredictable circumstances? Here are six predictions that marketing leaders should prepare for in 2023.
1. CMOs WILL INVEST MORE IN DATA-POWERED MARKETING TECHNOLOGY
First-party (customer) data has been more prevalent over the past few years as marketing organizations began to invest heavily in Customer Data Platforms. As marketers look for more efficiency in their total cost of ownership, they will invest heavily in marketing platforms that include built-in CDPs, allowing data to be organized and activated across every marketing channel to achieve better results and higher ROI for their business.
2. TECHNOLOGY COMPANIES ATTEMPT TO MOVE UPMARKET
More technology companies will attempt to move on from the small and medium business segment into the enterprise business playing field to capture higher values faster. However, as they change their strategies, they will find that building “enterprise chops” is harder than it looks, resulting in negative results for their tech business.
3. MORE CONSOLIDATION IN MARTECH/ADTECH
Mergers and acquisitions will be more prevalent in the new year, with smaller companies folding into larger platform-based companies. As companies that benefitted from consumer-demand surges during the heights of COVID, government loans, and small and medium business fields cannot find a soft landing, larger industry players will begin to consolidate their systems with new technology. CMOs should be mindful of the partners they have in place, given the expected shift.
4. CONNECTED TV CONTINUES TO SOAR
CTV is one of digital advertising’s fastest-growing channels, with US spending projected to reach over $21 billion this year and an expectation that CTV will grow an additional 14.4% in 2023, according to the IAB. Even as Netflix (powered by Microsoft) proves to be a consumer pricing model changer rather than an advertiser game changer, CMOs must navigate beyond a fragmented landscape to deliver ads at the app level—and measure them holistically at the individual level.
5. MEDIA ALTERNATIVES EMERGE WITH MORE ADVANCED MEASUREMENT
As the big tech companies undergo massive changes in leadership, pressure on policy, and a reduced workforce, there will likely be a huge shift toward more effective marketing that is based on individual consumer needs and intent—across multiple preferred channels—and has the capability to have advanced transparent measurement to understand ROI.
6. CONTENT REGAINS ‘KING’ STATUS, ESPECIALLY WITH RETAIL MEDIA
Brands will begin to view more personalized consumer experiences as content and increase investment in creative after years of focus on media as we head into the “Web2.5” era. This era, a middle ground between Web2 (today) and the emergence of Web3, will allow for better curation and discovery on the internet as many vertical-based platforms will begin to emerge. This new-age, immersive content will be highly engaging and shoppable for consumers, leading to more direct conversions for brands.
David A. Steinberg is the Co-Founder, Chairman & CEO of Zeta Global.