With consumer spending and marketing budgets shrinking, privacy rules tightening, and AI unleashing a new wave of disruption, CMOs and digital professionals are ill-prepared, new report revealed.
Marketing and digital professionals are concerned about more than just the state of the economy, a new study by Arktic Fox 2024 Digital, Marketing & eComm in Focus study reveals.
Marketers feel unprepared for looming Privacy Act reforms. Even more worryingly, they believe those in leadership positions are similarly unready – only 38% of those surveyed believe their executive group understands the importance of adapting to privacy changes and sees it as a key strategic priority to address.
They also worry they are falling behind their peers in MarTech utilisation, partly because they lack appropriately skilled staff. On top of all that, many are now fundamentally questioning their MarTech investment strategy and moving towards combining ‘best of breed’ solutions, rather than relying on a single vendor.
Now in its fourth year and formerly known as the Marketing State of Play study, the report, developed in conjunction with Six Degrees Executive and in partnership with Amperity, interviewed 250 marketing, digital and ecommerce leaders from a range of industries across Australia.
Marketers’ aspirations
Australian marketers’ focus remains business growth – 77% of respondents said it was a key strategic priority. Growth is tied to customer acquisition, which came in second (48%) on the list of priorities.
So far, so unsurprising. But subsequent priorities reveal marketers hope to fatten the bottom line by leveraging technology. The third most common priority (42%) was “Building our customer data strategy and better utilising our first-party data”, and the equal fourth (36%) was “Digital Transformation”.
The study also revealed marketers and digital leaders remain focused on achieving goals (over the next 12-18 months) that are only feasible with MarTech tools. Personalisation was classified as “important” or “very important” by 72% of respondents, who were also strongly committed to CX management (87%), online sales and lead generation (77%) and MarTech utilisation (76%). To put it bluntly, without sophisticated technology and skilled staff, most marketers and digital leaders won’t be able to implement their planned marketing and digital strategy over the next 12-18 months.
“Australian marketers want to take advantage of the available tools,” notes Billy Loizou, Asia Pacific Area Vice President, Amperity. “The problem – as they are usually the first to point out – is Australian marketers are struggling to execute. That’s hardly a new situation, but when you add in factors such as the rise of Gen AI, imminent reforms to the Privacy Act, flat marketing budgets and Google deprecating third-party cookies, it’s not surprising so many CMOs are nervous.”
Marketers’ reality
Marketers want to – and increasingly need to – leverage technology effectively. Nonetheless, many fear they are falling behind. This was particularly apparent when leaders were asked about their organisation’s data maturity:
· Only 29% of respondents agreed with the statement, “We are very effective at activating data to deliver great customer experiences.”
· Only 22% of respondents agreed with the statement, “Our data is well managed and maintained, providing us with high-quality data.”
· Only 19% of respondents agreed with the statement, “We have developed a unified view of the customer.”
Teresa Sperti, Director of Arktic Fox, is worried but unsurprised by these findings.
“When we undertake digital training sessions or partner with clients on strategy, it’s not uncommon for us to have to explain to an organisation’s staff, including its senior staff, where the organisation’s data resides and help them connect the dots around their MarTech ecosystem.
“Brands have been trying to develop a unified view of the customer for at least two decades. Yet in 2024, less than one in five of those surveyed could say their organisation had developed a unified view of the customer that could underpin a data-driven marketing approach. This is why there is a growing gap between the haves and the have-nots in spaces like personalisation, experience delivery and more. Brands that have built strong internal capabilities and robust foundations in data and tech are thriving whilst others are finding it difficult to shift gears.”
Sperti also warns that a casual approach to managing data and, in particular, privacy might result in more than suboptimal marketing outcomes. “Businesses could soon be suffering even more dire financial and reputational consequences for failing to appropriately safeguard their customers’ privacy,” she says. “A privacy or spam breach impacts reputation and trust, which is linked to brand performance and preference. So, I’m amazed there isn’t much more focus on improving compliance and ethics by marketers and digital leaders.”
Is it the machines or the humans?
There’s a consensus that Australian marketers and digital professionals aren’t making the most of MarTech solutions, but there’s debate about why that’s the case.
Those who question the tools point out marketers in many countries have failed to adopt MarTech solutions with the enthusiasm that was expected. Many CMOs appear to believe they overspent on technology and that investment has failed to meet their expectations and deliver the desired outcomes.
That’s partly due to the shortage of Australians with MarTech skills. But Loizou points out that the much-publicised skill gap doesn’t explain everything.
“To grossly oversimplify, the approach in the past was to buy the equivalent of a turnkey, off-the-shelf, full-stack solution from a big-name tech company. Given that 80% of respondents in the 2024 study reported their utilisation of MarTech was ‘average’, ‘low’ or ‘very low’, that doesn’t seem to have worked out well. The understandable but ill-advised reaction is to devote fewer resources to MarTech and MarTech staff training. That’s happening to some extent, with only 12% of respondents reporting they plan to significantly increase their MarTech budget over the next 12 months. But the noteworthy development is the declining popularity of single-vendor solutions. When asked about their plans for current and future MarTech investments, 14% said they were leaning towards a single vendor, 29% claimed they were open-minded, and a whopping 57% stated they were leaning towards ‘best-of-breed’ solutions.”
The digital transformation landscape
Both Sperti and Loizou remain concerned about what they see as an overly relaxed approach to digital transformation. Noting that almost all organisations now talk the digital transformation talk, Sperti wonders how serious they are about walking the walk. “Only about one in five respondents said their organisation had been transforming for a “long time”, with long time defined as three or more years,” she says. “And about one in two respondents reported their organisation was just starting, or had only recently started, their digital transformation journey.
The study also found that only 53% of leaders believe their executive group are aligned on digital transformation priorities.
“When brands aren’t aligned around digital transformation priorities, teams are set up to compete for resources and funding. That drives siloed thinking and that means it takes twice as long to deliver on ambitions. However, when executives lean into challenging discussions and make strategic choices, it enables the organisation to focus on the digital strategies that will deliver the most impact for the business and customers alike.” Sperti says
“With MarTech, the two big investment priorities for marketers remain CRMs (43%) and marketing automation (41%),” Loizou adds. “It’s good that CDPs [Consumer Data Platforms] are now the number three priority (35%), but I suspect many marketers still don’t fully comprehend how central CDPs are. The elevator pitch is that they allow marketers to improve the quality of their data, therefore an accelerator to fuel smart growth, retention, and foster a data-first corporate culture.”
Loizou doesn’t claim CDPs are a magic bullet. But he does insist that, unlike more popular solutions, they can address some of the pressing issues marketers now face.
“Just spending more on a marketing automation platform won’t solve messy customer data problems,” he says. “It’s CDPs that do that, as well as provide an enterprise-unified view, which then solves many of the other business-wide challenges organisations face. We live by the mantra better data = better results!”
We’ve got much more interesting data on Australian marketers
We’ve only had space to cover the more attention-grabbing findings here, but if you’d like to take a deeper dive, you can download the full report here. (For the first time, this year’s report also addresses the ecommerce maturity of Australian organisations.)
About the Digital, Marketing & eComm in Focus report
Developed in conjunction with Six Degrees Executive and in partnership with (gold sponsor) Amperity, the 2024 Digital, Marketing & eComm in Focus study interviewed 250 marketing, digital and ecommerce leaders across Australia.
The findings have been compiled from a 66-question survey and in-depth discussions with leaders. Responses were collected from 15 of January 2024 to the 31st of March 2024.
Respondents included marketing directors and CMOs, CXO and divisional heads, as well as digital, ecommerce and sales leaders. Respondents came from various industries, but disproportionately from education, finance, FMCG, healthcare, manufacturing, travel and retail.
About Arktic Fox
Arktic Fox is an advisory and learning organisation partnering with leaders to better exploit opportunities in the digital and ecommerce space and drive successful and sustainable outcomes in the digital age. For more information, visit Arktic Fox’s website.
About Amperity
Amperity, the first Lakehouse CDP, delivers the data confidence brands need to unlock growth by truly knowing their customers. With Amperity, brands can build a first-party data foundation to fuel customer acquisition and retention, personalise experiences that build loyalty, and manage privacy compliance. Using patented AI and ML methods, Amperity stitches together all customer interactions to build a unified view that seamlessly connects to marketing and technology tools. More than 400 brands worldwide rely on Amperity to turn data into business value, including Alaska Airlines, DICK’S Sporting Goods, Endeavour Drinks, Planet Fitness, Seattle Sounders FC, Under Armour and Wyndham Hotels & Resorts. For more information, please visit www.amperity.com
