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Future of Strategy 2021: strategy is in demand – and changing

While it was encouraging to observe the growing importance of the strategist in 2020, this year’s Future of Strategy report from WARC notes how, in 2021, that prominence has led to some introspection among the strategy community about the best place to learn and practice.

Why it matters

WARC’s annual report on strategy is based on a global survey of practitioners gives a helicopter view of what the discipline is thinking. You can read a sample here; subscribers have full access.

Takeaways

• Strategists are busier than ever as economies open up. The emphasis on strategy has continued from the first year of the pandemic, with workloads and productivity remaining high. However, mid-level strategists are increasingly looking beyond agencies for new challenges.
• Training is a problem. Few strategists have formal training and few receive the funds or opportunities to pursue such training – the report identifies this as a potential weakness for agencies looking to retain strategic talent.
• Strategists are increasingly looking upstream – to client-side, consultancy, or freelance opportunities – as the day-to-day business of project-based downstream planning is frustrating to many.
• On diversity, equity, and inclusion, the industry continues to talk a good game but tangible action is less apparent.

JPMorgan enters UK fintech with Chase digital retail bank

JPMorgan Chase is launching a digital-only retail bank in the UK in the coming week, part of a series of measures that together illuminate how the 222-year-old financial firm sees the future of consumer finance.

Why it matters

‘How do you do, fellow kids?’ Traditional banks getting among the UK fintech game with a digital banking offer don’t tend to do very well. It’s a tale littered with weirdly vowel-less new brands, big firm hubris, and confusion about how the new offer differs from the old.

The venerable US bank is hoping to avoid any of these pitfalls, with extensive research, big tech budgets, and rewards programmes – now we’ll see if this formula can work in a vibrant financial market.

The plan

Announced with an interview in the Financial Times, the launch is a major strategic commitment and a jumping-off point for a larger international retail banking expansion, explains Sanoke Viswanathan, the firm’s international consumer division chief. Its initial product will be a current account with rewards, before expanding out to personal lending and eventually mortgages. 

Unlike other established banks that have chased profitability too soon, JPM expects to invest heavily in order to build out its full proposition within three to four years. A business account is expected soon, too – a feature that separated the fintech winners from the losers in the first year of the pandemic.

The space it seeks to occupy is squarely between that of the unblinking spender among the upstart fintechs like Monzo and Revolut but with more wealth management, and the established, steady major brand with deep pockets but with better tech.

The move adds detail to recent news that JPMorgan was acquiring restaurant reviews service The Infatuation, which was assumed to feed into the rewards offers that (ought to) differentiate its products from the competition. More compelling was the news in June that it was acquiring the online wealth manager Nutmeg.

Deep roots

• News of the formal launch follows on from an initial announcement in January.
• “The UK has a vibrant and highly competitive consumer banking marketplace, which is why we’ve designed the bank from scratch to specifically meet the needs of customers here”, the bank’s consumer chief, Gordon Smith, said at the time.
• Notably, the company already has a major office centre in London’s Canary Wharf, from where it has built a vantage point into the dynamics of the UK’s banking market – a place where digital capability is almost as prized as the brand’s trustworthiness and stability.
  

Sourced from JPMorgan, Financial Times, WARC

Targeted advertising: looking beyond the data

Targeted digital advertising is not only vital to the European economy but has a larger social and cultural value that is often overlooked and not accounted for in conventional statistics, says IAB Europe’s Daniel Knapp.

What has targeted advertising ever done for us? 

In a new paper, Knapp, the organisation’s chief economist, warns against a blanket ban on targeted advertising, as suggested by the European Data Protection Supervisor earlier this year, and highlights its role in three areas:

• enabling the proliferation of small- and medium-sized businesses, including sectors which have special cultural value and wider positive effects on regional social structures;
• as an instrument in helping Europe find its place in a new digital world, spurred by large industrial policies and European Champions; 
• supporting a strong, pluralistic and independent media ecosystem.

Point to ponder

Knapp notes that Italy is particular in its reliance on SMEs that have strong roots in their local communities while also exporting abroad. As these small producers are cast on the digital stage, targeted advertising does more than just support business growth: by enabling these companies to compete for customers online, it helps preserve the uniqueness of local clusters of SMEs, the culturally significant goods they produce and the social structures that have grown around them.

Key quote

“We need a constructive debate on how the benefits of targeted advertising that uses data can be best combined with social values and cultural norms that allow Europe to foster long term prosperity” – Daniel Knapp, chief economist, IAB Europe.

Sourced from IAB Europe

19% of B2B marketing budgets go to advertising

Advertising is the largest segment of B2B marketing budgets, taking a 19% share, according to a survey of marketers worldwide by Salesforce.

Why it matters

Salesforce also finds that 47% of B2B marketers have 'completely changed' their marketing channel mix as a result of the pandemic, with WARC research highlighting growing B2B opportunities in new channels like video and audio. Account-based marketing is also evolving to encompass broader reach and greater personalisation.

While mental availability and marketing attribution are two key challenges for B2B marketers, B2C brands are providing some potential solutions.

Takeaways

• Advertising takes a 19% share of B2B marketing budgets.
• Account-based marketing, content, and tools & technology follow close behind and each take a 16% share.

Sourced from Salesforce, WARC Data

Remote working and internal politics hinder CX efforts

COVID-19 has made the digital customer experience increasingly important, but at the same time the pandemic has hindered collaborative efforts at improving it, a study finds.

A study of 209 decision-makers in businesses with large headcounts, conducted earlier this year by multi-agency consulting business Paragon DCX, found that 86% of respondents agreed that the CX they provide directly equates to commercial value, but 55% have struggled to recreate the customer experience they offered before the pandemic.

Why it matters

The study also found that half of large organisations do not have an approach to CX that is both developed and joined up; for many, the CX digital journey is, at best, merely functional and effective. With CX now becoming a point of differentiation and competitive advantage, marketers need to focus on how they can develop this aspect of their business. One option is the use of CX guardians or customer committees to bring teams together and oversee the work that goes into creating better customer experiences.

Key findings 

• Challenges: a lack of face-to-face meetings (cited by 44%), less cross department CX collaboration (33%), too busy because of pandemic to focus on CX (25%) 
• Barriers to collaboration: lack of time (32%), internal politics (31%), silos (29%), data not being joined up (24%), poor internal communication (24%).
• Data: 50% admit data sits unused on their CRMs – this despite the importance of data to profiling and segmenting customers and prospects. 

Quote

“It’s astounding that almost a third of respondents claimed internal politics prevents them from providing a better customer experience, especially as a significant majority understand that customer experience directly impacts their bottom lines” – Matt Conner, Chief Growth Officer at Paragon DCX.

Sourced from Paragon DCX

Effectiveness roadmaps give 26% boost to marketing effectiveness cultures

The marketing effectiveness culture of the industry is generally healthy, but a new report says there is significant work that can be done at a deeper level to boost business performance, most significantly through agencies and brands creating effectiveness roadmaps.

What is an effectiveness roadmap? 

The IPA explains it as having a coherent strategy and plan for continual improvement to business value across four quadrants – Focus / Process / People / Data Tools & Measurement – which is understood by the organisation as a whole. By analysing organisations’ performance across these quadrants, it is possible to identify ways to improve the industry’s marketing effectiveness culture.

What difference does it make? 

The inaugural IPA Effectiveness Culture Monitor finds that having an effectiveness roadmap positively increases marketing effectiveness culture scores by 26%. There are increases across all of the four quadrants with the most sizeable in Focus – having that clear vision which understands the levers to impact and value – from 5.4 to 7.8 out of 10.

Brands with an effectiveness roadmap are also more likely to balance long and short-term value and consider long-term value crucial.

What should I do?

• If you don’t have a roadmap, create one. The marketing effectiveness culture score of organisations increases from 3.7 among those who have yet to start, to 7.0 out of 10 once they have begun.
• Get buy-in from senior leaders. The Effectiveness Monitor Culture scores increase from 5.7 when there is no senior buy-in to 7.4 when those values are shared by the leadership.
• For agencies with a roadmap in place, there is an opportunity to become a stronger partner with their clients to show them the road to value.

Sourced from IPA [Image: IPA]

Lessons and reflections: TBWA’s local talent development journey

TBWA’s Sean Donovan, Hui Tsin Yee and Jan Cho view diversity not as a journey with an end but a journey of commitment.

Why it matters

A successful DEI strategy is a movement, not a mandate, with all hands on deck and led from the very top.

Takeaways

• DEI cannot be left to chance – if it can’t be measured, it can’t be managed.
• TBWA’s Take the Lead goal increased female leadership globally for a more balanced, inclusive and successful company.
• Changing the makeup of the workforce and ultimately the industry requires long-term commitment. 

Quote

“Our vision for diversity, equity and inclusion means relentlessly assessing, disrupting and addressing inequities for marginalised communities to achieve equitable and actionable outcomes” – TBWA’s Sean Donovan, Hui Tsin Yee and Jan Cho.

This is part of WARC’s Purpose Incorporated: A primer for brands in APAC series tackling the complexities and nuances of how brands can go beyond profit to do good and do better in the Asia-Pacific region.

APAC is physically healthier but mentally struggling: study

Almost half of the Asia Pacific region say they are physically healthier than before the pandemic, yet a quarter also say they are anxious and/or depressed, reveals a four-country study by Wunderman Thompson that examines health behaviours, attitudes and triggers across physical, mental, relational and financial health, and how each impacts the other.

Why it matters

As the COVID-19 pandemic continues to surge and dip, insights into APAC’s post-pandemic health landscape will help governments, businesses, healthcare providers and health brands to better understand consumers at a time when health is top of mind and under threat.

Key insights

• The APAC region scores 6.6 on a scale of 1–10 for overall health; respondents from India report feeling the healthiest at 7.6, followed by China (7.2), Singapore (6.1) and Japan (5.3).
• 45% of respondents say they are physically healthier than before the pandemic and 71% declare physical health “very much” a priority, but their mental health has taken a beating.
• A quarter of the region is struggling with anxiety and/or depression; 45% of respondents say being mentally down makes them less productive and 40% say they exercise less.
• To cope with life in a pandemic, 19% of respondents are smoking more, 21% are drinking more alcohol and 73% are spending more time on screens as these activities make them feel good and/or are a social lubricant.
  
• Indians report feeling the most financial stress and Japanese the least. However, Japanese lead in depression.
• China and India are the biggest app adopters; Indians are also most likely to use blood pressure apps at 39% (versus 24.4% overall) and fitness apps at 40.4% (versus 27.9% overall).  
• The Chinese are ahead in using sleep apps with 40.3% of Chinese respondents saying they use them versus 21.7% overall.

Background

The findings are based on an online survey of 4,000 people aged 18–70+ in China, India, Japan and Singapore conducted between February and April 2021.

44% of adults say they are not fully represented in advertising

Brands are failing to achieve diverse representation in their advertising, as more than two-fifths of consumers (44%) say they are not fully represented by the people they see in adverts, according to research across 17 markets from YouGov. Just 19% feel fully represented, with 31% in the middle (neither agreeing nor disagreeing).

Why it matters

Evidence shows that deliberately choosing to reach diverse audiences in more contextual, more targeted and more representative spaces can have a bigger impact for brands.

WARC's latest research explores conscious media investment and how this can support diversity and inclusion, with Diageo and GSK providing examples of this in practice.

Takeaways

• Over two-fifths of consumers (44%) say they are not fully represented by the people they see in adverts.
• This is true across the world - in 14 of the 17 markets surveyed, a greater share of people say they do not feel represented.

Sourced from YouGov, WARC Data

Back to the future with email

Almost two-thirds (63%) of US advertisers are invested in growing email lists via newsletters, seeing these as a valuable way to reach, target and personalize communication in the absence of third-party data.

That’s according to a survey by martech platform LiveIntent and Advertiser Perceptions that polled more than 150 US senior brand and agency marketers across verticals.

Why it matters

Email has long been a leading marketing tool that is essential to building trusted relationships between consumers and publishers. As advertisers look to replace third-party cookies while continuing to be committed to trust and privacy in their solutions, email identifiers have emerged as a top alternative. 

A majority of respondents (80%) believe that email identifiers offer the most direct path to consumer opt-in and consent. Many already rely on encrypted email identifiers, and advertisers are largely optimistic that IDs tied to email identifiers can provide a universal alternative that will be widely accepted by buyers and sellers.

Key findings 

• More than three-quarters of advertisers report high levels of satisfaction with the measurement and targeting capabilities of their newsletter advertising strategies.
• More than four in five advertisers plan to use email to strengthen lookalike targeting, dynamic creative offerings and measurement.
• Within the next six months, 49% of marketers plan to use industry-backed ID graphs/consortia to address privacy changes while 48% plan to focus on building second-party data relationships. 
• A majority of advertisers consider the ability to drive ROI, the ability to achieve scale and reach, and the transparency and accuracy of the solution as the most important criteria when choosing an identity solution partner.

Sourced from LiveIntent

Findings from the Facebook document pile

Facebook, the world’s most significant and scrutinised social media company, knows a lot about its internal problems, according to a trove of documents uncovered by the Wall Street Journal – here’s what we know.

Why it matters

Is Facebook a bad place to advertise? Still no. While it has since 2019 tried to implement more of a master brand ‘by Facebook’ strategy, one of its key strengths is that Instagram and WhatsApp enjoy an important separation from the mothership, at least in people’s minds. The other factor is that most of Facebook’s users now don’t live in the United States where this is major news.

However, the pressure is on, between reports of secret preferential treatment for VIPs and company knowledge of the mental health impact the company was having on its users , and the promise of more revelations to come. Those that are currently public have already drawn Senate attention.

It boils down to the fact that rules, laws, and even people are not prepared for a company, driven by potent and clearly effective recommendation algorithms, that is this consequential. Should an advertising destination – which is, ultimately, what Facebook Inc. is – touch this many people, be this opaque, and continue to be so successful despite ignoring problems that have been brought to its attention?  

The documents

The Wall Street Journal’s reporting shows that Facebook’s own researchers have identified major problems with the service, not limited to policy exceptions and adverse effects on users, but that the platform has not fixed them. There are reasons both technical and commercial for some of these oversights.

• The Journal’s first revelation surrounds XCheck – pron: Cross-Check – which was a technical solution to whitelisting some 5.8 million of the platform’s VIP users from rules around bullying, hate speech, sexual content that apply to everybody else automatically. XCheck is a review system that blocks automatic moderation of content posted by VIPs while it passes to a human moderator in order to avoid negative media attention from incorrect policy enforcement against influential celebrities and politicians.
• One of the most egregious examples was when the footballer Neymar Jr. posted the name and nude images of a woman who had accused him of rape. In his counteraccusation of extortion on Instagram he posted images and content that clearly contravened the site’s policies, but XCheck allowed these to stand. Worse still, despite a one strike policy against posters of revenge porn, Neymar was allowed to keep his account.
• The second story surrounds several reports, reviewed by senior leadership, that outlined the effect of Facebook platforms – especially Instagram – on young women and girls. Driven by the understanding that the platform is more geared to social comparison than its competition, many young women in the US and UK report feelings of unattractiveness, anxiety, and – among a minority – suicidal thoughts.

Key quote

“We are not actually doing what we say we do publicly,” said a 2019 internal Facebook review of XCheck, adding that the policy was a “breach of trust”.

Sourced from the Wall Street Journal

Ireland’s National Lottery focuses on attention

Social campaigns for Ireland’s National Lottery are now focused on attention rather than engagement and reach.

Why it matters

Likes, clicks and view duration are the wrong tools for the job of ensuring that the National Lottery is the first brand Irish consumers think of when feeling optimistic and dreaming of changing their lives, explains social media manager Stephen Cleary in Marketing.ie.

With the switch to attention, the brand has rethought its approach to media planning and buying, including buying advertising for the first time on a social media platform with lower reach but greater active attention than its usual choice. 

Takeaways 

• The use of attention data to plan media has streamlined planning processes, reduced reliance on vanity metrics and driven clearer brand objectives.
• There is a more structured approach to the use of distinctive brand assets so that social ads can be largely visual (with little text and no reliance on sound) yet instantly recognisable.
• The campaign saw a 35% increase in attention seconds and a nine point uplift in distinctive brand asset score.

Key quote

“Across the digital landscape, including TV and VOD, the cost of attention must be appreciated to plan media properly” – Stephen Cleary, social media manager at Ireland’s National Lottery.

Sourced from Marketing.ie [Image: lottery.ie]

TikTok user activity overtakes YouTube

TikTok's user activity has overtaken YouTube's in the United States and UK, though the app still lags behind in South Korea and Japan, according to an analysis of Android devices by App Annie.

Why it matters

Both platforms are expected to benefit from a shift in marketing budgets, with online video, influencer content and social media seeing the greatest planned increase in 2022.

For YouTube, the quickest growth is coming from connected TV devices, while TikTok is expanding its user base to older audiences. Additional research shows most TikTok users are female and younger, while YouTube is more popular with male and older audiences.

Takeaways

• TikTok user activity is higher than YouTube's in the United States and UK, though it still lags behind in South Korea and Japan.
• The short-form video app has seen quicker growth since 2019 than YouTube in all four markets.

Sourced from App Annie, WARC Data