2021 is going to bring forth a whole new set of challenges for brands around the world. Luckily WARC's released their latest toolkit to help get everyone ready.
This will be WARC's 10th edition of the Marketers' Toolkit and in the words of the VP of content at WARC, David Tiltman himself, " the questions facing marketers as we approach 2021 are more profound than any previous year." In hindsight, the impacts of 2020 were necessary in some sense. It helped break old thought patterns and habits and allowed people to build new ones. Look at ideas and thoughts from new perspectives. However, such monumental changes also bring with it, their own set of challenges.
Responding to Recession
The seismic events of 2020 have been traumatic, to say the least. As Communicate covered in earlier reports: media budgets have been slashed, brand-building activity is on hold, while performance channels receive greater spend. At the same time, brands must find new creative solutions to achieve recognition in the post-pandemic marketplace.
The insights in this toolkit are based on global surveys with 1000+ marketing executives and one-on-one interviews with more than 20 CMO's and marketing leaders. Based on their feedback, 73% believe that majority of budgets will be allocated towards influencer marketing in 2021. Respondents also believe that nascent channels including gaming and podcasts can be optimistic of growing ad revenues over the coming 12 months, while print and cinema media will be bracing for a tough year.
Prior to the pandemic, Facebook and Google have been enjoying a duopoly in the digital advertising market. The pandemic has only helped tighten their grip on the market and it will be carried forward into 2021. With the rise in online shopping habits, brands are seeking to reach consumers in shoppable moments, Amazon and TikTok are both rising up the agenda – with 44% of advertisers planning to spend more on the social video app next year.
Advertisers are still trying to reel from the twin impact of the global recession and unprecedented consumer behavior change. Experts expect budget cut in 2021 as well with 70% predicting that the axe will fall majorly on brand advertising spend. Meanwhile, with consumers still restricted from attending events for the foreseeable future, over half (53%) forecast a decrease in sponsorship spend.
Given the turmoil caused by the pandemic, short-termism remains the leading cause for concern among advertisers in 2021. However, brand marketeers believe they are doing a much better job of balancing short-term and long-term brand strategy than their agency partners. Only 3% of agency respondents believe the brands they work on are doing an excellent job, compared to 12% of client-side marketers.
Brand marketeers are responding to this desire for value in a number of ways, by focusing ad spend on specific product lines (33%), running price promotions and sales (30%), reducing their product portfolio (21%), and altering pack sizes (20%). Four in ten respondents say they are developing new product offerings to cater to post-pandemic consumer preferences.
Staying effective in the age of e-commerce
The COVID-19 pandemic has accelerated e-commerce growth globally. Brands in many sectors have had to respond, bringing forward plans to rethink distribution and experimenting with new models, including direct-to-consumer options. This shift will have knock-on effects on brand strategy and media investment.
Reports and expert opinions suggest that the shopping habits developed this year will stick, particularly among certain cohorts. 67% of client-side respondents expect the shift to e-commerce to be permanent. Retail (63%) food and drink (47%) and FMCG (44%) are other sectors that also agree strongly with the statement.
With the change in preferences and shopping habits, brands have a lot of changes to make on their end. But one of the aspects that should definitely be kept on high priority is the online customer experience. The study noted that 64% of respondents will focus on improving the online customer experience while 47% plan to increase the number of online channels they sell-through. Marketeers will also need to rethink media plans and advertising strategies, to ensure their products and services are noticed by and engage, at-home consumers.