For many, 2020 required a significant shift in marketing strategy. Marketing budgets were quickly revised to increase digital presence in a world where face-to-face interaction has become taboo. So what does this mean for 2021?
For many companies, marketing budgets and marketing channel allocation will continue to shift. What was a short-term strategy to address plummets in lead generation volume will continue to shift to a more permanent long-term strategy.
Shifts in Marketing Mix
Marketing mix is the allocation of marketing budget to various marketing channels. Determining what your marketing mix should be should start with an analysis of various marketing metrics as you look back at 2020 marketing mix performance. Two key metrics for 2021 planning include:
1. Cost per contact generated per channel
Using marketing automation platforms like HubSpot or Marketo (among others) provide detailed insight when identifying the source of new contacts generated. To determine the cost per contact generated, take the total spend for a specific marketing channel divided by the number of contacts generated to identify your cost per contact generated.
2. ROI per channel
Calculating ROI might look differently depending on the products or services your company offers. ROI in its simplest form is spend divided by revenue generated. Keep in mind that just because a particular channel has lower ROI than another doesn’t mean you should decrease your spend in that area — it simply means that you might have to invest more budget to generate the target sales numbers you are looking for. Keep lead quality in mind and assess the amount of time it takes to convert a contact to a customer. In some cases, higher spend for higher-quality leads that convert faster than other channels might be worthwhile.
What should your marketing budget look like? Overall, the allocation of overall budget to your marketing budget should generally be between 6.5% and 10% of the overall company’s budget — although many companies are reporting spend as high as 15% to cope with dramatic decreases in lead generation and sales volume. What may surprise many is that on average marketing leaders that see high lead conversion spend 26% of their marketing budget on marketing technology alone. Marketing tools that allow for swift execution of digital marketing campaigns and a holistic view of analytics performance are key when determining which channels are performing and which aren’t driving traffic.
Even traditional marketing channels have become more measurable when integrating them with digital marketing strategies. Tracking URLs or call tracking numbers can be placed on billboards, in newspaper ads, or used on radio ads to identify traffic volume metrics. Long gone are the days where marketing wasn’t measurable in some way, shape or form.
Expected Marketing Mix Changes in 2021
For half a decade, investments in traditional advertising channels have consistently dropped by single digit percentages each year. Digital marketing spend, by comparison, has consistently grown by double digit increments year after year. This means businesses are shifting their marketing spend — and rightfully so. While it likely isn’t advisable to go all-in on digital, digital marketing has proven to be measurable and agile. Traditional marketing still aids in brand awareness and market positioning but plays far less of a role in direct lead generation than it did a decade ago. Realistic goals and expectations when it comes to traditional marketing channels are key. A spend strategy that is based on “that’s what we’ve always done” will leave businesses at risk of being out-performed by competition that is quicker to make adjustments based on consumer needs.
2020 brought several unexpected changes, among them is the shift from the amount of marketing spend on traditional advertising strategies to increased spend in digital advertising strategies. On average, businesses are expected to spend at least half of their overall marketing budget through online channels in 2021.
Shifts in marketing strategy should have a customer-centric approach. A market research survey completed with one of Elite’s clients showed 56% of respondents preferred text message marketing as compared to 33% who wanted to see the same message via email — completely opposite results than marketing leadership had expected from the survey.
Additionally, 20% of customers and contacts ranked direct mail as the third most beneficial marketing tool — and important insight for a company that used direct mail sparingly in 2020.
While only 3% found radio ads useful and 5% reported they were still using newspaper to learn about the company or incentives offered, the company made some significant changes to their traditional versus digital marketing spend for 2021. Traditional marketing spend for radio and newspaper had previously accounted for 15% of the overall marketing budget and now has been decreased to 7% to account for an increase in digital marketing spend in 2021. All of these changes were driven by customer feedback to ensure adjustments as significant as these would pay off.
A market research survey sent to your existing customers and contacts to learn what marketing channels they find most helpful can be extremely helpful when identifying shifts in marketing mix to increase lead generation volume.
So what marketing channels should you consider increasing spend and focus? Here’s a look at five channels expected to see significant growth in marketing spend in 2021.
Online video is projected to represent that highest growth category. 59% of executives would rather watch a video than read text and by 2022 it is projected that online videos will make up more than 82% of all consumer internet traffic. Year-over-year mobile video consumption has risen 100% and viewers retain 95% or more of a message when they watch video as compared to 10% when reading text.
65% of people use YouTube to help them solve a problem and 75 million people visit Facebook’s video platform every day. Increasing leads generated in 2021 doesn’t necessarily require a new and exciting strategy – it might require new types of content being promoted on the channels you’ve been using for quite some time.
For some companies, virtual events were started out of necessity, but many companies have found that ROI and accessibility means they are here to stay. Whether you’ve shifted to hosting an online memory loss support group for your Senior Living community, or have decided to make your annual customer retreat virtual – complete with door prizes and engaging speakers -, or work in the farming industry and are taking your customer equipment clinics virtual to keep farmers up-to-date with equipment maintenance - many companies are learning that virtual events are the key to engaging prospects and customers in an era where face-to-face interactions have become far and few between.
Blogging with Visual Elements
Although video content reigns supreme in terms of engagement, blog articles are still an extremely useful lead generation tool. But it requires more than just a well-written article – readers want visual elements incorporated into blog articles, too. Whether it be an infographic, a meme, or a chart – there are plenty of ways to visually stimulate readers while presenting a well-written article.
Brand-related articles are useful for those actively researching and considering your company, but problem-solution based articles still perform highest in lead generation blog content topics.
Referral and Influencer Email Marketing
Email marketing can play a key role in converting marketing leads to sales prospects. Email marketing for lead generation specifically focuses on referral and influencer email messages. Here are some key points when crafting your 2021 email marketing strategy for lead generation
What’s the key to successful email marketing in 2021? Empathy, empathy, empathy. Whether you work in healthcare, manufacturing, farming, or any other industry – 2020 was a difficult year for most (both in business and in our personal lives). Human-centric email marketing that embraces empathy with receive a much higher response rate than email marketing targeted at strictly your product and service offerings. Companies turned to email marketing as doors closed due to shut downs and quarantine periods in 2020. Setting yourself apart from hundreds of other businesses vying for attention from your target audience. Never before has it been more important to send the right message to the right prospect at the right time. A one-size fits all to email marketing rather than a segmented approach isn’t going to cut it. Personalized subject lines will drive open rates and empathetic and personalized email copy will drive engagement in 2021.
Voice-search and mobile-friendliness will continue to impact search engine rankings for businesses in 2021 – but this isn’t a new trend.
In addition to voice-search and mobile-friendliness, companies will need to continue focusing on content that conveys expertise, authoritativeness, and trustworthiness to rank for search terms – a strategy that fulfills Google’s EAT (expertise, authority, trustworthy) principle. This is one of the primary reasons companies are still heavily reliant on blog article content for future lead generation efforts related to your website. If your company has a set-it and forget-it approach to updating your website, competitors that continually enhance website copy and add content such as articles or long-form downloads will see higher volumes of website traffic overall.
Elite is a full-service marketing agency that is experienced in lead generation, lead nurturing and sales enablement strategies. Whether you are looking for assistance to complete market research similar to the study outlined in this article, are looking for an in-depth analysis of your marketing spend effectiveness, or looking for a strategic partner to plan and deploy marketing campaigns, Elite has a team of experienced marketing experts who can meet your needs and your marketing budget.