Acquisition marketing results are slipping from their 2020 levels -- even while retention has improved, judging by The Ascension To Digital Marketing: A Benchmark Report, a study by CommerceNext.
Of the retailers polled, 57% say their acquisition marketing is meeting or exceeding their goals this year, down from 76% in 2020 and 65% in 2021.
Among the greatest challenges are rising acquisition costs (61%), and finding and retaining top talent (46%), the latter rising from 31% in 2020.
Digital-first brands are more likely to blame costs — 66% cite them as a challenge to achieving their 2022 ecommerce goals, vs. 54% of incumbent or traditional retailers.
In contrast to acquisition, 66% overall say their retention/loyalty marketing is meeting goals -- up from 56% in 2020 but down two percentage points from 2021.
Of course, retention marketing presents its own problems:
This is happening as 29% of retailers are spending 20%+ of their revenue on marketing -- a 4% hike over last year, and closer to 2020 levels.
One issue that seems closer to being solved is first-party data use. But serious challenges remain:
Email is the biggest source of first-party data, although SMS is catching up.
Of the retailers polled, 48% invite customers to share more data or to opt in to receiving information, and another 35% offering these options and expanding their programs, with 5% planning to start.
Overall, 96% of incumbent retailers offer email collection, vs. 80% of digital-first companies.
But some firms are noticing email’s declining effectiveness as a channel, prompting them to move toward SMS solutions, the study claims.
For instance, Firstleaf CMO Geoffrey Sanders says SMS is “more nimble, and possibly just as effective [as email] given certain messages are so time sensitive that it makes more sense for consumers to get quicker responses via text (e.g. ‘Your order is out for delivery’ or ‘last call’ notifications),” the study notes.
After acquisition, finding and retaining top personnel is the biggest challenge. The biggest hurdles to recruiting talent are:
CommerceNext surveyed 114 respondents across retail and brand types and verticals, starting in February of this year.