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WARC Talks: Three marketing trends for 2024

WARC’s David Tiltman, SVP Content, and Aditya Kishore, Insight Director unpack The Marketer’s Toolkit 2024.

• They discuss political polarisation, generative AI’s evolution into content creation, and masculinity in crisis.
• The Toolkit identifies trends that will disrupt existing global marketing practices and offers insights to help turn these disruptive areas into opportunities for growth.

Listen to the episode in full here 

Timestamps

02:15 – What is the Marketer’s Toolkit?

05:07 – Political, ideological and social divides are growing deeper.

11:03 – AI is evolving from processing to creating.

18:08 – Masculinity is in crisis.

Further reading

The Marketer's Toolkit 2024

What we know about marketing to men

Introducing The Marketer's Toolkit 2024

The Marketer’s Toolkit 2024 has now landed: the thirteenth edition of the report dives deep on five emerging trends for the coming year using a new proprietary methodology alongside an extensive global survey – here’s what you need to know. 

WARC members can read the full report right here.  

If you’re not yet a member, you can find a sample of the report here.

Why the Toolkit matters

Based on a survey of 1,400+ marketers, in-depth interviews with CMOs, and WARC’s GEISTE methodology for trendspotting, the Toolkit provides strategic support for planning and decision-making to understand the challenges and opportunities for the year ahead. 

Why it’s useful 

Not just another forward-facing trend report, the Toolkit identifies five major trends for the year ahead, exploring the quantitative and qualitative data that WARC analysts used to establish these ideas. 

We then put these in context by surfacing highly effective examples of a brand response to each trend, CMO viewpoints, and practical takeaways.

Five trends

1. Unlocking the potential of Gen AI: Nearly three-quarters (70%) of marketers plan to unlock the potential of AI in their marketing. 
2. Preparing for the age of polarisation: 13% of marketers said the best strategy is to “drop all ‘purpose’ driven strategies and political positions”.
3. Masculinity in crisis: Almost two out of three marketers (63%) agree that the way they communicate with young men needs to change. 
4. “Sportswashing” is a growing concern: 61% of marketers concur that it is “very important” for sports organisers and owners to avoid being politically divisive.
5. Sustainability should be locally relevant: Nearly two-fifths (38%) of marketers are investing in local communities.

Taking on economic uncertainty 

“Marketers globally continue to be concerned about the economic picture with 64% of survey respondents seeing it as the biggest factor in 2024 planning. But a majority (61%) of firms expect improved business performance next year, up 10% from last year,” explains Aditya Kishore, Insight Director, WARC, and principal author of the report. 

You can read Aditya’s introductory essay to the Toolkit, Capturing growth in the YOLO economy, on WARC Opinion. 

The evolution of marketing

The Marketer’s Toolkit 2024 is part of WARC Strategy’s The Evolution of Marketing program, offering a series of practical reports designed to help marketers address major industry shifts to drive marketing effectiveness in the coming year. Look out for a series of podcasts and a webinar on the Toolkit in the coming weeks.

Industry snapshot: Five trends shaping B2B marketing in 2024

The latest WARC industry snapshot report examines key macro B2B drivers, identifying five trends that will shape marketing strategies in 2024, including: influencer marketing, B2B’s transition to hybrid sales, AI-driven personalisation, marketing’s efficiency drive, and ESG as a catalyst for value creation. 

Why the snapshot matters

Based on WARC’s GEISTE methodology, the snapshot reviews the macro drivers expected to impact marketing across six pillars: government, economy, industry, society, technology, and environment. 

The report, which WARC members can read here, combines the analysis of these factors with sector-specific research to generate a comprehensive picture of the trends shaping the B2B industry and charts how marketers can respond. It also contains a series of hypothetical scenarios to help businesses plan and prepare themselves for different potential futures. 

Five B2B trends

1. Doubling down on influencer marketing: Businesses are amplifying their influencer marketing campaigns as customers increasingly turn to third-party sources to inform purchasing decisions.
2. B2B sales are increasingly hybrid: B2B selling will continue to transition to a hybrid model, combining online and offline interactions to meet changing customer behaviours and preferences.
3. Enhancing personalisation with AI: Customers increasingly expect to receive personalised experiences, and businesses are utilising AI in an attempt to meet this demand.
4. B2B marketing’s focus on efficiency: Mirroring a wider trend in the marketing industry of stalling budgets and rising costs, B2B marketers face growing pressure to achieve more with less.
5. ESG as a catalyst for value creation: Businesses are taking a more proactive approach to environmental, social, and corporate governance (ESG) as they link these practices to long-term value creation.

Key statistics

1. Three-quarters of B2B marketers are currently utilising influencers, and 93% of CMOs plan to use influencers more frequently.
2. B2B buyers spend roughly two-thirds of their time engaging with suppliers online – either through digital self-service or remote human interactions. The remaining one-third of interactions occur via traditional channels such as face-to-face meetings or direct mail. 
3. A majority (93%) of B2B executives plan to increase their investment in generative AI within the next 12 months.
4. Less than half (47%) of SaaS licenses are actively used, and roughly three in five (61%) B2B marketers think their current martech stack is too complex.
5. Nearly half (46%) of B2B decision-makers think that ESG has become more important as a consideration in procurement decisions over the past two years. 

Go deeper

• WARC members can read the full report here. 
• See all other reports in the Industry Snapshot series here.

China woos foreign tourists

A political thaw, more visa-free travel and new marketing campaigns are expected to boost inbound tourism to China.

What’s happening

• Earlier this month, Presidents Xi and Biden agreed on the need to improve air connectivity between China and the US and to hold “a high-level dialogue on tourism”. 
• Following a recent visit to China by Australia PM Anthony Albanese – the first such visit in seven years – travel agencies in Australia are offering huge discounts on package tours to China, the South China Morning Post reports. 
• Passport holders from more than 50 nations can now stay in most parts of China for up to six days visa-free as transit visitors. 
• Trip.com, China’s biggest online travel firm, is investing in marketing and product integration over the next three years, and is teaming up with the government-affiliated programme ‘Nihao China’ (Hello China) which features promotional videos and digital communications.

Why Chinese tourism matters

Foreign tourism spending will be a welcome boost to the local economy: before Covid-19, overseas tourists were spending $130bn a year. 

“The Chinese inbound travel market has substantial growth opportunities, as it currently accounts for 0.3 per cent of China’s GDP,” said Trip.com in a statement. “This leaves ample room for expansion, which will ultimately boost various sectors such as hospitality, transport, retail and entertainment, leading to an increase in our business growth in the future.”

Sourced from South China Morning Post, Skift

Towards a new sponsorship agenda

Brands can make more use of sponsorship to drive sustainability and social equity, according to the WFA.

What happening

The WFA’s Evolution of Sponsorship* report found that: 

• Around half of brands surveyed (49%) say they are using sponsorship to promote sustainability or social equity.
• Four in ten (42%) are not yet using their sponsorships to advance and demonstrate their sustainability and/or social equity agendas; 9% don’t know what, if any, use is being made of sponsorship to drive values. 

Why sponsorship agendas matter

There’s a gap between values and engagement, a space brands can inhabit to demonstrate how they can be a force for good. 

Further, as traditional consumer connections splinter, it has grown more challenging for brands to reach particular audiences, such as the younger Generations Z and Alpha. Sponsorship is an opportunity to establish an emotional connection with audiences by engaging with their passions and enhancing their experiences.

Key quote

“Sponsorship offers brands a unique chance to connect with consumers while they’re doing what they like the most … It’s a great opportunity for brands to pave the way for a better world, live up to their purpose, and lead positive change rebalancing inequalities” – Laura Forcetti, Director of Global Marketing Sourcing at WFA. 

 * The report is based on responses from 34 multinational companies with a total global advertising spend of US$51.3bn. 

Sourced from WFA

Children take to Gen AI

Teenagers and children in the UK are far more likely than adults to have embraced generative AI, according to a new study from regulator Ofcom.

Online Nation 2023 looks at all aspects of the nation’s online lives and finds that: 

• four in five (79%) online teenagers aged 13-17 now use generative AI tools and services;
• a significant minority (40%) of younger children aged 7-12 are also adopting the technology. 

Why generative AI trends matters 

Generative AI provokes a combination of curiosity (the most common reason for using it is simply to explore the technology: 48% of 16+ internet users) and fear (58% are concerned about its future impact on society). Brands may need to address these differing views when using AI in their marketing strategy. 

Interestingly, the most prolific users of generative AI among this broader group – the online 16-24-year-olds – are also most likely to be worried about its societal implications (67%).

Takeaways

• Adult internet users aged 16 and above are more reluctant users of generative AI (31%). 
• Among those who have never used this technology (69%), nearly one in four have no idea what it is (24%).
• Snapchat My AI is the most popular generative AI tool among children and teens, used by half (51%) of online 7-17-year-olds; online teenage girls are its most avid users (75%). 
• ChatGPT is the most widely used generative AI service among internet users aged 16 and above (23%). Among online youngsters aged 7-17, boys are keener users of ChatGPT than girls (34% versus 14%).

Sourced from Ofcom

The missed sponsorship opportunity for brands

Sponsorship accounts for a significant chunk of the marketing budgets of multinational brands, but this activity remains relatively unmanaged and unmeasured for many, according to new research from the WFA. 

The WFA Evolution of Sponsorship study, produced in partnership with Lumency, notes that global sponsorship spending is projected to grow at a CAGR of 8.7% from 2022-30 and reports that sponsorship accounts for, on average, 11% of a brand’s marketing budget. 

Why sponsorship ROI matters

That level of spending is second only to media spend for many brands, yet just 5% of brands surveyed* said they feel “very confident” that the investments in their sponsorship portfolio are addressing the right audience, with the right assets and for the right spend. 

But while most brands said measuring ROI of their sponsorship is their most significant challenge related to sponsorship activity, they are spending on average 1% or less of their sponsorship budget on post-evaluation/impact measurement (a fifth of brands spend nothing). Clearly, there is a lot of work to be done in this area.

Takeaways

• Brands need to measure outcomes (eg improved consumer awareness) rather than outputs (eg the number of attendees at an event).
• Brands need a model or framework to determine the commercial value of the rights and entitlements they secure with their sponsorships (31% say they have such a framework, 38% are developing one, 31% have no plans in this regard).
• Activation is a missed opportunity: two in five brands surveyed (43%) say they do not know what they are spending on the activation of sponsorships. Almost the same proportion (39%) are spending less on activation than on rights fees.
• Procurement teams can bring structure and add value to the organisation’s sponsorship activity, well beyond negotiation of rights and contracting. 

*The report is based on responses from 34 multinational companies, with total global advertising spend of US$51.3bn. 

Sourced from WFA

Elderly Chinese embrace short-form video

China’s senior population are spending an increasing amount of time online, embracing short-form video apps and becoming influencers themselves. 

Context

In the past, older people tended to avoid expensive gadgets, but Covid-19 lockdowns were a turning point as smartphones and social media became important new points of connection for them. 

Older people are now spending more time online, as the prices of both phones and data have fallen. Academic studies suggest that while this could help in alleviating loneliness among this age group, it could also be contributing to internet addiction. 

Why social media habits matter

Earlier this year, the Cyberspace Administration of China suggested limiting the amount of time children and teens could spend on their phones, but it might equally have questioned the habits of older people. Whatever the rights and wrongs, it’s clear that marketers can find this age group – which has significant spending power – on social media platforms; Wired notes, for example, that many elderly are shifting media consumption from TV to Douyin.

Takeaways 

• China has become a post-cash society in which a smartphone is essential for everyday living.
• Leading phone brands are targeting older people; one, for example, promotes a product as “the phone for your grandpa”. 
• Social media is a lifeline for many older people whose children have moved from towns and villages to cities. (Or they may have moved to the city with them and have limited IRL social interaction in their new environment.) 
• There’s a growing number of older Chinese influencers (eg Glamma Beijing – pictured above – advertise fashion and beauty products).

Sourced from Wired, Deutsche Welle, Taylor & Francis, Frontiers, Reuters

[Image: Glamma Beijing, Deutsche Welle]

Ozempic-maker experiments with pricing to reframe buyer value

Novo Nordisk, the maker of the popular if controversial drug Ozempic, is attempting to innovate on pharma pricing models for its Wegovy product, proposing a ‘risk-based’ pricing model that allows healthcare providers to spread the cost of the drug over a longer period with the promise of eventual savings down the line. 

These savings would come through a reduction in obesity-related problems and costs. 

Why Novo Nordisk’s pricing strategy matters

Across media, the medium is so often the message. For Novo Nordisk, it’s the pricing model that acts as the message to would-be buyers. The lesson – that the big price of a service or product will eventually deliver savings through its use – has great potential across the B2B marketing space. 

The story is deeper, however, as Novo Nordisk faces competition from rivals using a similar medical technology: will it be able to reframe its offer to the point that it can protect its first-mover advantage and the price premium that it’s established?

What’s going on

Danish pharma firm Novo Nordisk is adapting how it talks to healthcare systems as it seeks to increase the uptake of its effective but expensive weight-loss drug Wegovy. 

• The company is best known for its semaglutide drug, which is the active ingredient in the diabetes treatment Ozempic. An insulin regulator that also causes dramatic weight loss, it exploded into public consciousness when several celebrities like Elon Musk credited the product with helping the SpaceX CEO shed 13kgs. 
• In recent years, #Ozempic has blown up on TikTok to the point of causing shortages of the drug for type 2 diabetes patients to whom it is typically prescribed. Wegovy is the formulation specifically for weight loss.
  
• Very simply, it reduces people’s appetites while also slowing the rate of digestion to keep patients feeling fuller for longer.

Why now?

Such hype has boosted the profile of both the company and product but it remains expensive to buy. 

• In an interview with the Financial Times, CEO Lars Fruergaard Jørgensen explained the company’s new thinking about selling an expensive product that promises savings down the line, with recent trials suggesting that Wegovy can cut the risk of serious cardiac events by around a fifth.
  
• “How can healthcare systems justify making a large one-time payment upfront that leads to significant savings down the road? I think we need to share that risk to get going,” he tells the paper.
  
• In the US, the drug costs over $1,300 per month and many insurers don’t cover its costs. It is slightly cheaper in Europe, but healthcare systems – often taxpayer funded – have typically only prescribed the drug for patients with extremely high body mass index. 

The question, then, is whether a new pricing model can reframe the investment case away from saving individual lives and toward a system-wide investment in reducing obesity (42% of US, and 17% of EU populations). 

This goes far further

The Ozempic effect isn’t just a pharma story, but a full blown macroeconomic conundrum the likes of which we rarely see. Recently, the maker of Krispy Kreme doughnuts saw its securities downgraded on analysts’ assumption that widespread Ozempic use is going to hit demand. 

Walmart has registered some behavioural change among users of the drug who shop at the supermarket, with fewer food products sold as a result. 

Sourced from the Financial Times, Euronews, Lloyds Pharmacy, Bloomberg 

[Image: Novo Nordisk]

Cultural hybridity and the future of glocal branding

As Asian cultural influences grow and populations hybridise, people are becoming more culturally diverse and interconnected, leading to new challenges for brands operating in a glocalised world. 

Why cultural hybridity matters

Amid the rise of Asian national pride and cultural influences, there is lower tolerance for Western examples of cultural insensitivity, and global brands can resonate with local markets only by embracing cultural hybridity to ensure relevance and creativity.

Takeaways

• Create a genuine conversation between geographies, time periods and world cultures to be more inclusive and renew creativity.
• Authenticity remains the key, and brands must first draw inspiration from their own cultural identity and legacy.
• To hybridise branding in a genuine way, overcome the dichotomy of local and global while developing multicultural intelligence.

ABM picks up in APAC

Account-based marketing (ABM) is gaining momentum in the Asia Pacific region as a new study shows not only a solid base of existing practitioners but an even higher proportion of recent adopters.

The latest State of ABM in APAC from B2B marketing agency xGrowth outlines how the B2B marketing strategy is increasingly going mainstream and that’s being accelerated by recent market and technological shifts.

Why account-based marketing matters

Bringing marketing and sales teams onto the same page is the top motivation for companies to leverage ABM to target a set of accounts, as the economic downturn emphasises the need for targeted and cost-effective marketing approaches. 

While ABM can help in this regard, there are still challenges around attribution, metrics and reporting.

Takeaways 

• A majority of those surveyed (86%) have either already adopted an ABM approach (35%) or started adopting it in 2023 (51%).
• 59% of ABM practitioners surveyed plan to increase their ABM-related investments in the coming year.
• The one-to-one ABM tier is popular in APAC, with 50% of marketing and sales teams leveraging it.
• Australia, New Zealand and Singapore are the top three geographies where marketing teams direct their ABM programs.
• 60% of long-term ABM practitioners use direct mail to engage their target audience.
• Popular channels included email marketing, paid ads and outreach by sales teams.
• The majority of ABM marketing leaders (55%) say generative AI is either currently impacting their marketing decisions or will influence them in the future.

Sourced from xGrowth

How marketers can navigate Gen AI complexities

As marketers embrace the capabilities of generative AI, they must strike a balance between efficiency and the ethical use of these technologies, argues a marketing professor in a WARC exclusive.

Why Gen AI matters

Marketers might be tempted to use generative AI tools like ChatGPT to create content at scale, but they must balance saving time and resources with minimising the potential for harm to brands, people and the planet.

WARC members can read the full exclusive here.

Artificial intelligence will be significant for this industry, but the new technology won’t be an unalloyed good: risks include the inadvertent creation of harmful content, inconsistent brand tone of voice, erosion of creativity due to over-reliance on automation and the environmental costs of producing more advertisements, not to mention the energy usage of the technology itself.

Takeaways

• As the climate crisis intensifies, marketers should be looking at doing better by doing less. Reduce ad clutter to minimise environmental impact. 
• Translate the unintended consequences of AI-generated content into wider company functions so that they can be managed, looking at it through the lens of brand/reputation management, CRM, sustainability/ESG goals and regulatory compliance.
• Deploy a human-AI collaboration approach with pre-screening tools and content filters to minimise the risk associated with the use of Gen AI tools. 
• AI literacy and diversity training in Gen AI is essential for modern marketers.

Key quote

“An internal policy and a planning guide for Gen AI can help ensure marketers and business leaders are empowered to navigate the complexities of evolving Gen AI, while also minimising the risks of the unintended consequences of AI in their marketing efforts” – Kimberly Hardcastle, Assistant Professor in Marketing at Newcastle Business School (AACSB), Northumbria University.

Consumer confidence grows but Christmas outlook still complex

Following an uncomfortable year of price rises across much of the globe, the festive shopping season is set to be a huge moment for advertising as people spend whether they like it or not, but there are now signs that consumer confidence is improving.

Christmas in the bad vibes/YOLO economy

Back in October, strategist and WARC columnist Faris Yakob wrote about the strange phenomenon of the YOLO [you only live once] economy: one in which despite predicted economic downturns, people continue to spend money like there’s no tomorrow. 

GfK consumer confidence data for the UK, out on Friday, suggests that the festive period will constitute something of a rally in overall confidence. “The dramatic 10-point jump in our major purchase sub-measure, reversing some of the worrying 14-point drop we saw last month, will be good news for retailers looking to benefit from Black Friday and Christmas,” says Joe Staton, GfK’s client strategy director, in a statement.

Heading into the festive season, the fight for that spending is now heating up. WARC/AA figures for the UK alone anticipate £9.5 billion of adspend in Q4 2023. But the likes of Black Friday deals and the retailers that are set to benefit most from them, such as Amazon, will be important.

Spending through the struggle

Many people are spending money even though they are struggling. A Harris Poll in the US last week found that 81% of Gen Z and millennial shoppers plan to splurge even if 62% say they’re not set up financially to do so, Retail Brew reports. 

Overall, the picture looks tight, with some surveys indicating that consumers will aim to spend less and pursue more deals; other surveys from earlier in the year, such as the IPA’s, painted a bleaker picture of greater cutbacks.

Young shoppers are out for deals

eBay research by Censuswide, based on a survey of 2067 UK adults between 30 June and 4 July, found: 

• 22% of 16-34s do their shopping during Black Friday sales
• 49% of 16-34s plan to take advantage of sales throughout the festive season

Online shopping is key

Commerce media firm Criteo’s Q3 survey of 2,381 UK consumers found that the majority of people plan to spend more online (74%) this festive season, but the figures also sketch a less loyal audience: 

• 79% are prepared to purchase from new online stores for the festive period 
• In general, 61% report frequently trying new brands and retailers 

However, it’s not just price: Criteo also found evidence of ethical and environmental price elasticity, with people willing to pay more in certain instances: 

Ethically produced products

• 37% of respondents would pay 5% extra
• 16% would pay 10% extra
• 3% would pay 20% or more 

Carbon-neutral delivery

• 39% would pay 5% extra
• 13% would pay 10% extra
• 2% would pay 20% or more

Locally produced food

• 39% would pay 5% extra
• 22% would pay 10% extra
• 5% would pay 20% or more

Sourced from WARC, eBay, Criteo, Retail Brew, GfK

Chinese social media’s new high stakes

Major social media platforms in China are demanding that popular KOLs or influencers use their real names, raising questions about a form of celebrity and a source of advertising heft that had become hugely important to the country’s internet economy. 

Why the creator economy matters

KOLs (Key Opinion Leaders) are important channels for brands operating in China, but the risks to the people who do this work are growing – with their anonymity under threat, the diversity of voices is under threat. 

What’s going on

In late October, social networks Weibo, WeChat, Douyin (TikTok in China), Zhihu, Xiaohongshu, and Kuaishou announced that users with a high number of followers would need to make their legal names visible to the public, Rest of World, a tech news site, reports. 

• It is likely that the policy change is a response to the Chinese internet regulator’s scrutiny of anonymity in order to better control the online environment. 
• In response, some users are either leaving platforms or – in order to maintain anonymity – culling some of their followers to come in under the threshold. 
• “Many [influencers] are choosing to remain silent for now, waiting to see how the policy will be enforced,” said one influencer agency exec from Beijing, speaking to RoW anonymously. 

Given that outspoken criticisms of the government are rare, some observers believe that influencers’ greater threat is the collapsed wall between their offline and online lives, which is likely to chill online conversations once they can have more real-world impact. 

For marketers, it’s likely to mean that the wide pool of possible influencers will shrink, while the appetite for less risky technological alternatives like virtual KOLs will grow. 

Sourced from Rest of World, WARC

How an NBA team set itself up as a standalone ad business

The Utah Jazz play in the NBA but are now going it alone on TV and online as the franchise aims to build an ad business that can ensure its sustainability in the face of seismic changes to the sporting model, with many of the lessons universal. 

Why new sport broadcast formats matter

The US is the largest sport market but it is undergoing significant disruption: the viewing format and experience is evolving as tech giants like Apple move into the space or as leagues and clubs explore new markets. In Europe, many major football clubs have in-house production capabilities and paid channels – some are even producing advertising – but the opportunity to branch out and own a significant chunk of the customer relationship into match day is rarer. The opportunities beyond the broadcast, however, are expanding fast.

All that Jazz

The team is the subject of a report in Bloomberg Businessweek exploring how the company set itself up to continue broadcasting games to fans of the franchise, whether on TV or online, at a time when Regional Sport Networks (RSNs) on cable, traditionally a steady stream of revenue for teams, are struggling to survive. 

How it works

The strategy has two prongs:

• KJZZ: a local TV station first acquired in 1993 aimed at beaming to as many households as possible on a free-to-air basis. 
• Jazz+: a paid streaming service that carries both NBA games not on national broadcast channels and new content formats featuring players and technical staff.

To power this, the franchise already employs a 35-strong in-house broadcast crew, which is different from most other teams and leagues in the US. 

Utah’s relative isolation and small population meant that it sensed vulnerability in the cable market early and was able to protect itself by making some smart job hires.

Working on a long-term horizon

Jazz owner Ryan Smith cut his teeth founding the survey company Qualtrics and joins a new set of NBA owners with tech backgrounds. The adoption of a scale first, monetise later strategy is clearly present. 

• Currently, the team expects to bring in just 50%-70% of the revenues it had made from AT&T Sports Net (its previous RSN), but with a loyal fanbase, the three-year road plan to get back up to speed is to become a small but mighty advertising firm.
  
• KJZZ’s reach constitutes a 220% boost to its previous reach under an RSN. The team hopes that as word proliferates more people will put up antennas, allowing higher reach to translate into higher ad rates.
  
• Jazz+ anticipates a targeted ad capability, building on a unique practice of the franchise keeping all its ad inventory and revenue back when it had an RSN deal. 

While the project remains experimental, other teams and leagues are watching. Engagement statistics are good, with more than 65% of subscribers logging in for games, according to the Jazz.

Sourced from Bloomberg, WARC