In a recent conversation with a chief technology officer, he asserted all digital technology changes in his organisation were being led by IT and not by marketing. It made me wonder: How long a marketing function like this could survive?
Australia is leading the region when it comes to embracing and utilising digital marketing, but more needs to be done to build multi-channel customer engagement excellence and skill sets across the industry.
These are the overarching findings of the second annual APAC Digital Marketing Performance Dashboard Report, conducted by the CMO Council in partnership with Adobe. The research involved a six-month in-field program to benchmark levels of adoption, traction and success of digital marketing across Australia, China, Korea, Singapore, Hong Kong and India and was based on responses from 276 senior marketers.
The report claims Australia leads the way when it comes to support for digital marketing from corporate leadership, with 44 per cent of senior managers providing very strong support this year, up from 29 per cent in 2012. This was much higher than all other countries regionally including Singapore, where 26 per cent of senior executives are backing digital marketing as a business strategy.
Overall, 49 per cent of Australian companies surveyed are spending at least 25 per cent of their total marketing budgets on digital marketing, a leap of 8 per cent year-on-year. The average global spend on digital marketing is between 25-35 per cent of total marketing budgets. Measurement capabilities, cost efficiency and the ability to prove a return on investment are the key drivers of digital marketing uptake in Australia.
“Australia has long been leading the market not just in business advancement, but also in terms of digital and mobile adoption,” CMO Council vice-president of marketing programs and operations, Liz Miller, told CMO. “On a marketing level, Australia has a corporate culture that values and positions marketing as a strategic role within business, not just as a functional part of the organisation.
“Australians also have a broad marketing toolkit and high degree of sophistication in terms of media modelling.”
In line with recent studies citing the flood of interest in content marketing, the Adobe dashboard found website content development is receiving the highest level of digital marketing funding in Australia (89 per cent). Email marketing moved into second place with 77 per cent, compared to 54 per cent last year, while search engine optimisation came in third at 74 per cent, up from 66 per cent in 2012.
Seventy-seven per cent of Australian marketers also put digital marketing content strategy as the top priority this year for the first time. Other major priorities are social media optimisation, and increasing and improving search and online display.
However, skills shortages, particularly around analytics, continue to hinder the Australian marketing industry’s ability to truly take advantage of digital marketing opportunities, along with insufficient investment.
Marketers continue to rely on isolated and old-fashioned measurements such as website performance (87 per cent of respondents) and click through rates (77 per cent), and are not looking enough at wider and more long-term metrics reflecting the customer lifecycle. For example, customer churn rates and customer lifetime value were listed as a priority by just 13 per cent of total respondents.
“These customer-centric measurements should define the actual business case, which is something marketers continue to have a hard time positioning,” Miller commented. “That has to come from real revenue and engagement – it can’t come from campaign metrics or KPIs.”
Miller pointed out Australians continue to struggle to run the types of analytics programs needed to take digital customer engagement to the next level.
“We need to base the development of relevant content on key actionable data found from that customer intelligence. Think of it as digital marketing phases: Australia is certainly at phase two, looking to move into phase three, but we’re lacking the talent that can power the insights, analytics and that ‘big data equation’ in order to push us forward and meld content with that true actionable customer insight data.
“We’ve also created this 'Frankenstein' effect by looking at all these digital channels through different and isolated dashboards, and just been paralysed in the midst of all that analytics. We get results from email, social, the Web, direct mail programs, that don’t link and connect, so we don’t have the ability to show how our customer is actually engaging with us as an organisation.
“The universal truth heard the world over is that customers do not do business with one channel. Customers do business with a brand. We have to start not only thinking of strategies that are fully connected and across channel, but also thinking about measurements that are cross-channel. That’s where technology platforms come in that can measure across all those touchpoints become critical.”
Another interesting finding of the latest dashboard is the reliance of Australian marketers on multiple agencies to conduct digital activities (79 per cent; up from 65 per cent in 2012). This is despite the fact that just 18 per cent of marketers rate their agencies ‘extremely effective’.
Miller also put this down to insufficient strategic skills in the agency sector.
While there is a ways to go, Adobe’s managing director, Paul Robson, welcomed Australia’s position as a digital marketing centre of excellence across the Asian region.
“This vindicates our decision to set-up a digital marketing centre of excellence in a mature market such as Sydney and share that expertise and leverage those skills for the region,” he added.