As the United States undergoes massive shifts, marketers are concerned about how changes will affect business, including inflation and macro-economic factors.
Some 85% of the marketers who responded to Merkle’s survey conducted earlier this year are concerned about how inflation and other macroeconomic factors will impact their organizations thus year.
Larger companies expressed even greater levels of concern, with 91% of respondents from organizations with annual revenue of more than $500 million saying they were concerned about the impact of inflation. In organizations with annual revenue of less than $500 million, 80% expressed concern, but to a lesser degree than larger businesses.
When asked how brands might respond to economic changes, Matt Mierzejewski, senior vice president of search at Merkle, said to think about the fallout in 2008.
“Some brands in 2008 decided to pull back on advertising and focus on margins,” Mierzejewski said. “Other brands took a shot to accelerate. … They increased budgets by 10% to 20% in a down economy.”
More retailers might reduce spending through the phases of a recession. Financial and insurance services will try to take share by spending.
Mierzejewski also pointed to the importance of creative, using machine learning to optimize the content. Some 45% of respondents prioritized machine learning to help inform creative. Dynamic creative optimization (DCO) supports the shift.
In the past three months, 57% of advertisers said paid search spend rose YoY, with similar trends across Google Shopping and Google text ads. The majority of survey respondents said they are experiencing cost-per-click and click increases YoY across text ads and shopping ads.
The insights Mierzejewski shared came from Merkle’s Q3 2022 Performance Media Report, which analyzes trends in digital marketing.
The report takes a look at performance media channels and uncovers data around ad spend, marketers’ top priorities, business readiness, and challenges facing organizations. It also reveals significant opportunities for performance media and a basis to create more meaningful experiences for customers.
Merkle sourced the data from primary survey research conducted by one of its companies, Ugam, in May 2022. About 250 marketers across the United States participated. The companies represented in aggregate generate more than $100 million in annual revenue.
When asked to cite the top areas of paid search that are most important, survey participants cited the following: improving product data quality for visual ads, combatting rising competition and CPCs, testing Google Performance Max campaigns, managing audience and first-party data, and leveraging automation in ad copy.
Marketers also will focus on privacy changes and tracking in the quarter, with 64% of survey respondents prioritizing analytics and measurement more year over year during the past three months. Google’s deprecation of Universal Analytics and migration to Google Analytics 4 (GA4) is also contributing.
Analytics and measurement are not customer-facing, but 55% of respondents identified them as “very important” to their customer experience strategy.
Some 45% of respondents choose accurate reporting as a top-two priority in measurement, because “data paints the picture of how consumers are engaging with marketing efforts and whether those efforts are resonating, measurement ties that data to core business objectives, and analytics translate data into the insights, trends, and audiences that power activation and optimization.”
Attribution, data visualization, and online-and-offline connection were each identified as top two priorities for 40% of respondents.