Future of Strategy 2022: vital skills and worrying shortages

WARC’s Future of Strategy survey finds that, in a tumultuous world, strategists continue to gain influence, but talent shortages are a major concern for the profession. Here’s what you need to know.

Why it matters

From the COVID crisis through to today’s economic environment, uncertainty necessitates strategists.

Strategists’ generalist abilities stand out, as the report describes clients in need of professionals that can simplify, integrate, think big-picture, and address issues outside traditional marketing and move into new areas like responses to climate change. 

You can read the full report here.

Method

These findings are based on the tenth edition of the annual study, taking in responses from over 700 client- and agency-side strategists, as well as 12 in-depth interviews with strategy leaders.

The report examines “how strategy careers are evolving, the biggest topics impacting the function and what strategists need to do to meet high client expectations in an uncertain world”, explains Anna Hamill, Senior Editor - Brands, WARC.

Five ideas you need to know

1. Tumult keeps strategists in demand. Though the pandemic might have ended, the upheaval has not. Respondents feel optimistic about the value and influence they can bring both to their clients and agencies.
   
   
2. Agencies struggle in talent war against deep-pocketed competitors. Continuing a years-long trend, but with additional urgency, 46% of strategists are concerned about being able to find the right talent at a time when a majority (57%) report that they plan to hire to fill current gaps. Just 30% expect their next strategy role to be in an agency.
   
   
3. Thinking beyond marketing and about the business’s performance. Versus last year, 49% of strategists report working on upstream business problems with their clients as the discipline’s biggest opportunity – a ten percentage point increase on 2021’s results. But other questions are being asked too: a significant majority of strategists expect sustainability (82%) and DEI considerations (70%) to be more visible in client marketing strategies and briefs.
   
   
4. Strategists brace for cost-of-living crisis. Eighty-six percent of respondents anticipate the cost-of-living crisis will have a significant or transformative impact in the next year and 69% believe that it will be at the centre of marketing communications. However, the extent of concern depends on the region. In North America – which has a more optimistic mid-term economic outlook than Europe – just 50% of respondents believe that cost-of-living concerns will be more visible in client briefs, compared to 79% in Europe and 69% in APAC.
   
   
5. Diversity, equity, and inclusion needs work. Both at a client and at an agency level, challenges remain in this area with agencies continuing to lack internal diversity while clients struggle to deliver DEI agendas.
   

Go further

Expert commentary from leading strategists, who include Joyce Ling of Wunderman Thompson China, Aki Spicer of Leo Burnett Chicago, Anush Prabhu of MediaCom, James Honda-Pinder of We Are Social, Mehak Jaini of 22feet Tribal Worldwide, Eunice Tan of The Secret Little Agency and Nick Myers of OLIVER Agency, is available to read here.

The full Future of Strategy 2022 report which includes quantitative and qualitative data analysis and advice, is available to WARC subscribers.

A Future of Strategy podcast will be released mid-October.

NFL sponsorship hails Apple’s arrival in sport

The iPhone maker and the National Football League have struck a deal for the sponsorship of the Super Bowl’s halftime show, replacing Pepsi, and hinting at deeper shifts in Apple's business.

Why it matters

Apple tends to do its marketing differently, usually choosing to stay high-end, but taking the spot of a major CPG firm at the country’s biggest advertising event indicates the importance of the mass market to Apple’s evolving business.

Now used by the majority of Americans, continued growth will come both from intensification of existing users while continuing to acquire new users. Sport is already a strategic pillar to this, as evidenced by Apple’s successful move for Major League Baseball rights.

What’s going on

The joint press release aims to reflect how the music and sport combo of the halftime show chime nicely with Apple’s longstanding presence in music (and also, it says, sport), but it comes at a time when the kinds of sums demanded by the world’s largest sporting IP are only available from major west coast tech firms of Apple or Amazon size.

The New York Times makes much of how it could point to a deeper relationship emerging in coming months or years, reporting that the opportunity for the halftime sponsorship stemmed from talks about a deeper relationship.

With an expensive though little used streaming service to sustain, it’s not beyond the realm of possibility that more, and more expensive sport will be available exclusively on Apple+. As its advertising ambitions grow, could it mean buyers going to Apple both for performance and more traditional-style TV inventory?

Sourced from NFL, New York Times, WARC

China’s half trillion-dollar wedding market and its discontents

The estimated average cost of a wedding in China is 8.8x a couple’s average monthly income, which has driven up the size of the country’s wedding market over 30% from 2020 to reach around half a trillion dollars (4.14 trillion Rmb).

Why it matters

Short-term growth in this particular market, however massive, doesn’t tell the whole story of China’s evolving attitudes to marriage.

An intellectual shift

Luxury news site Jing Daily pegs the rapid growth to the desire for unique, custom wedding experiences even as the official number of weddings fell by 6.1% in 2021 versus the year before.

A report from Daxue Consulting identifies in this surging market a deeper intellectual shift from more traditional wedding ceremonies toward ceremonies that reflect the changing tastes of individual couples. But it comes at a difficult time for the demography of the country.

A deeper trend

China has recently launched a marital and maternity survey to assess the ability of citizens to get married and have children amid precipitous drops in birth rate that could lead to population decline, which is a long-running concern. 

Some reports have linked the dip in rates of marriage to a need to fulfil a number of markers of success – having a good job and owning a house among them – before tying the knot, which has grown more difficult to achieve as prices have risen in a growing economy.

There is a cultural issue here, as delaying marriage is significant in a country where extramarital births are not explicitly outlawed, but certain local interpretations of the law make it very difficult for non-traditional families to obtain crucial state help.  

Declining births are also partly blamed on the effects of the country’s one-child policy, which ended in 2016, that contributed to an imbalance of more men than women in the population.

Still, it’s important to note that for many individuals the confluence of these wider shifts suggest a life in which people increasingly make their own choices. With far higher levels of education in younger generations – especially among women – marriage is no longer the primary objective for many young Chinese. It will take time for the system to adjust.

Sourced from Jing Daily, SCMP, FT, Daxue Consulting

Price is an essential element of a brand’s communication

Research indicates that consumers place far more emphasis on price as an influence on their perception of a brand than executives believe – part of a set of findings that suggest pricing should be part of the brief for the department that owns the customer relationship: marketing.

Why it matters

Prices are going up across the board, and to maintain any margin, consumer prices are rising too – this is a communications challenge, given the significance that buyers place on price, and should drive a re-think of marketing’s influence over pricing.

What’s going on

This is the conclusion of an article on pricing strategy in the Harvard Business Review, in which marketing professors and researchers from the universities of Ramon Llull (Barcelona), Munich, and Massachusetts, explain how price is far more than the result of a numerical calculation, but a signal of the business’s intentions, and look to theories in the field of linguistics for ways to approach it.

They make three recommendations:

• Prices reflect values. Certain brands have made good, fair prices a core value. Sometimes, this can be a case of showing slightly higher prices so long as there are no nasty surprises later in the interaction.
• Explain the price. Break down the costs or explain the rationale behind an eventual price, with transparency on internal costs like rent or wages humanising the eventual figure.
• Break rules. Sometimes, emphasising expense, or talking about it in totally new – even seemingly irrelevant – ways can elicit new comparisons.

Sourced from Harvard Business Review

Consumer confidence spirals downwards

UK consumer confidence hits a(nother) new low today but the picture is similar across Europe and the US where the spending habits of a majority of consumers are being reconsidered in the light of rising prices. 

Key figures

• GfK’s UK Consumer Confidence Index fell to -49 in September; the index has reached new lows in four of the last five months.
• Future-facing indicators are particularly bleak: confidence in personal finances in the coming year is down nine points to -40 while confidence in the economy in the next 12 months is down eight to -68.
• A separate study from First Insight found that, on average, 82% of consumers in France, Germany, Italy, Spain, the UK, and the US have less confidence to spend ahead of the holiday season.
• On average, 68% of consumers are most impacted by rising food prices, most notably in Germany at 78% with the UK and Spain closely following.
• German consumers report the most significant inflation-induced change in their shopping habits and say they are shopping more for deals and staying within a budget.
• The threat of recession concerns at least 92% of consumers in every country and two thirds, on average, believe that a recession is already underway. 
• Almost one-third of consumers overall acknowledge that they are saving less because of high prices, and 17% report that they are tapping into savings to cope with the cost of living crisis.

Why it matters

Falling consumer confidence and belt-tightening ahead of the crucial holiday season means brands and retailers may need to re-examine their pricing and promotional strategies. 

Key quote 

“Consumers are buckling under the pressure of the UK’s growing cost-of-living crisis driven by rapidly rising food prices, domestic fuel bills and mortgage payments. They are asking themselves when and how the situation will improve” – Joe Staton, Client Strategy Director, GfK. 

Sourced from GfK, First Insight