1. Executive Summary and Highlights

This is the second annual Cross-Channel Marketing Report, published by Econsultancy in association with Responsys. The research, based on a 2013 survey of nearly 900 companies and agencies, looks at the extent to which online and offline channels are used as part of cross-channel marketing programmes. These are the key findings from this year’s report.

Companies realise they need to focus more on building relationships with customers, but most are failing to do so

The research shows that companies recognise the importance of building value for and from their customers as part of an on-going relationship. Almost three-quarters of responding companies (70%) agree with the statement that “it is cheaper to retain than acquire a customer”, and just under half (49%) agree that “pound for pound, we achieve better ROI by investing in relationship over acquisition marketing”.

However, just 30% of companies say they are “very committed” to relationship marketing, with 22% conducting no relationship marketing at all.

The most commonly cited barriers preventing companies from committing to relationship marketing are a lack of resources (22%) and no clearly defined strategy (19%). This suggests that despite the recognised cost effectiveness of relationship marketing, companies have not yet made the move away from a campaign-centric approach, with 64% agreeing that this is the way they are still carrying out business. In addition, companies are more likely to focus on acquisition than retention despite the fact they consider this not to be an optimal state of affairs.

44% of companies say their main focus is on acquisition, compared to just 16% who say they focus mainly on retention. For agency clients, the figures are even more skewed towards acquisition, with 58% of supply-side respondents saying their clients focus mainly on acquisition versus just 12% for retention.

Asked where they think they should focus (see chart on right), only a small minority believe they should be more focused on acquisition (21%), while a similar proportion (22%) report they should be more focused on retention. Most company respondents (56%) say there should be an equal focus, recognising the need for a balanced approach.

As customer behaviours change and information is consumed from an ever greater number of channels, it will become more important to build relationships at an earlier stage of the customer decision making process.

Companies switching away from static, campaign-centric models to those that place an emphasis on lifetime customer value are likely to be those that succeed in achieving sustainable and growing revenue streams in the future.

Integration increases as companies see the value of a joined-up approach

Companies were asked to indicate the level of integration between specific digital and offline marketing disciplines and their wider marketing programmes. Across every single digital channel and discipline that was queried, a larger proportion than last year are likely to say that their channels are “very integrated” with their wider marketing efforts. Since last year, the largest total changes are seen for online display advertising (+9%) and social media marketing (+9%).

This is also largely the case for offline channels. With the exception of telemarketing and direct mail, companies are more likely to state their efforts are “very integrated” with the rest of their digital marketing compared to last year, with the most significant change for newspapers (+11%).

However, in most areas (other than website and email), it is still the case that less than half of companies describe their efforts as “very integrated” with their broader marketing strategy.

Of particular note, the level of integration across mobile appears to be significantly less than with other channels. Just 20% of companies say their efforts with the mobile web are very integrated with their overall marketing activity, with similar percentages for mobile messaging (23%) and mobile apps (17%).

Agencies appear to have a different opinion about the levels of marketing integration within businesses, consistently citing that their clients’ marketing activities are less likely to be integrated than is suggested by in-company respondents.

Lack of strategy continues to hold companies back, with little change since last year

For both this year and last year, the most commonly cited factor enabling effective coordination of cross-channel marketing campaigns is a clearly defined strategy, with 37% of companies identifying this as such this year (up from 28% in 2012).

Despite the shortfall in the area of strategy, there are worrying indications that many companies are failing to address this as an issue, particularly in the context of mobile.

40% of companies have no strategy for integrating mobile into their broader marketing campaigns.

More than half of companies (54%) spend less than 20% of their time on strategy and planning, despite qualitative responses showing that they believe they should be spending more time in this area.

With strategy being identified as a critical area for success, it appears that marketers are not able to spend the time and resources desired to plan their activity for maximum impact.

Mobile advertising sees massive growth, but many companies need to catch up

With mobile being such an all-pervasive and growing area for marketing, it is no surprise that significant progress has been made in this area.

The number of companies stating that they use the mobile web as a marketing channel has increased from 35% to 44% in one year, while those using mobile apps has increased from 31% to 35%.

In addition, there have been significant increases across every type of mobile advertising. For both companies and agency clients, the largest increase has been in mobile display advertising (rising from 23% to 48% for companies, and 41% to 55% for agency clients).

However, in addition to these positive signs, there are indications that many companies are not making the progress that they should.

When asked about what mobile solutions they employed, nearly half of companies (49%) said they do not employ any particular mobile solution.

Only a fifth of companies (20%) target and personalise mobile display advertising based on location.

The greatest opportunities for marketers are still online, but integration across channels will become more important

As was the case last year, responding companies were asked to indicate which channels offer the greatest opportunity over the next year. As shown in the chart below, the top 10 most cited channels are all online, with the most popular ‘traditional’ channel being direct mail at 8%.

Social media marketing is the channel most likely to be cited as one of the three channels offering the greatest opportunities for the next year, with half of companies (50%) choosing this option. Considering that many of these channels did not exist in any significant way 10 years ago, the landscape for marketers has rapidly changed. However, this does not mean that the opportunity within more traditional channels is now redundant. Rather, companies will have to think more clearly about integrating their marketing efforts across channels for the greatest impact.

Which three marketing channels offer the greatest opportunities over the next year? (company respondents)

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2. Foreword by Responsys

Relationships are what define us as human beings. At their most basic level, societies are built on connections between people: the bonds that join families, friends and colleagues are an integral part of our social fabric. In short, relationships are fundamental to civilisation as we know it.

They’re no less important for marketers and brands. Created in association with Responsys, the Econsultancy Cross-Channel Marketing Report 2013 proves that companies realise that maintaining relationships with existing customers is critical. Perhaps one of the most quoted statistics in this area comes from the world of finance, where it costs high street banks up to six times more to win a new customer than it does to retain an existing one.

So it might seem an obvious leap to say that companies in all sectors should be looking at relationship marketing as a major opportunity. The Econsultancy research supports this theory, with 70% of businesses agreeing that it is cheaper to retain than acquire a customer. The surprising element is that despite this strong belief in the theory, according to the research results relatively few marketers put relationship marketing into practice. Evidence suggests that most marketing departments are still focused on a campaign-centric approach and are therefore missing out on the gains they know are waiting for them.

The first Econsultancy Cross-Channel Marketing Report, published in 2012, forms a benchmark against which we can measure this year’s results. This latest report shows that brands have made positive strides in integrating their offline and digital marketing efforts, with a greater percentage of marketers describing their approach to various channels as “very integrated.” There are major gains to be achieved through proper integration of a truly cross-channel approach.

More generally, marketers report that the biggest opportunities are still to be found online. Social media marketing is thought to present the single biggest opportunity, perhaps because its full potential is yet to be realised by most, but also because of the opportunity it presents to get close to customers.

Marketers now have to focus their entire marketing strategies directly around the customer. The mass marketing era is over, replaced by personalisation on a large scale which is powered by data. This is the true benefit of online: the ability to deliver personalised, relevant content at scale to your customers. As more marketers integrate their digital marketing strategies, the agility and scalability of cloud marketing solutions will enable easier integration and drive long-term value.

That is not to say that traditional channels are redundant, but the way they are being used has to change. As this report demonstrates, the best way to get value from offline and digital channels is to use them in combination, as part of an integrated strategy. I hope this report educates, encourages, and inspires in equal measure.

3. Methodology

This is the second Cross-Channel Marketing Report published by Econsultancy, in association with Responsys.

There were 890 respondents to our 2013 research request, which took the form of an online survey2 in April and May 2013. Respondents included both companies (in-house marketers) and supply-side respondents (including agencies and consultants).

Information about the survey, including the link, was emailed to Econsultancy’s user base and promoted on Twitter. The incentive for taking part was access to a complimentary copy of this report just before its publication on the Econsultancy website.

Detailed breakdowns of the respondent profiles are included in the appendix.

4. Findings

4.1. Use of marketing channels and integration

The chart below illustrates which digital channels are used by companies as part of their marketing efforts. Data from the 2013 survey is compared against the results from 2012.

As would be expected, the website is the most popular marketing channel, with 94% of companies using this as part of their marketing efforts. With its ease of use and high return on investment, email follows with 88%.

The area which has experienced the most significant change since the last survey is in the use of the mobile web; last year, just over a third (35%) used this, but now the figure is 44%. With consumers increasingly using their mobile devices to interact with brands, this growth reflects the need for companies to connect with their customers through this channel. Mobile apps also saw growth from 31% to 35%.

4.1.1. Use of online channels / marketing disciplines

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4.1.2. Highest priority channels

Figure 3 shows which channels (both online and offline) are listed as being the highest priority for companies over the next year.

In a similar situation to last year, the website is the highest priority channel, with just over half (52%) of companies citing this as one of their three main areas of focus. This is followed by email (47%) and social media marketing (41%). These three channels have all seen increases in the proportion of companies highlighting them as a significant priority.

Channels which have seen significant falls are direct mail (falling from 12% to 7%) and affiliate marketing (falling from 10% to 6%).

[Download PDF to see Graph]

For agency respondents, answers were slightly different. Agencies were most likely to state that social media marketing is one of the main priorities for their clients, with over half (54%) stating that this was the case. The other biggest areas were website (40%) and SEO (33%).

[Download PDF to see Graph]

4.1.3. Channels with the greatest opportunity

Figure 5 below illustrates the marketing channels which companies believe offer the greatest opportunities for the next year.

The first trend to notice is that the top 10 most cited channels are all online, with the most popular offline channel being direct mail at 8%. Social media marketing is the channel most likely to be cited as one of the three channels with the greatest opportunities for the next year, with half of companies (50%) choosing this option. This is followed by email (43%) and the website (35%).

Agency responses are slightly different, with the mobile web being selected by 44% of respondents compared to just 26% of company respondents. Web retargeting also sees a significant difference, with 27% of agencies selecting this compared to 13% of companies.

[Download PDF to see Graphs]

4.1.4. Integration of offline channels with digital marketing

The charts below show which offline channels are integrated with digital by both companies and agency clients.

For both sets of respondents, the two channels most likely to be integrated are newspapers (57% of companies, 56% of agency clients) and direct mail (53% companies, 51% agency clients).

[Download PDF to see Graphs]

4.1.5. Extent of integration of online channels

With the customer journey being recognised as a non-linear activity that involves multiple touch points, a joined-up customer experience has become an increasingly important priority for marketers. This trend has been accelerated by the continued growth in the number of devices used by consumers.

In order to understand the underlying trends, companies were asked to provide details on how integrated each of their channels were. Responses are shown in Figure 9, with year-on-year changes in the channels listed as being “very integrated” shown in Figure 10.

It is encouraging to see that for every single channel and discipline listed, more companies are likely to say that their efforts are “very integrated” compared to last year, with the largest total changes being seen in online display advertising (+9%) and social media marketing (+9%).

However, the level of integration across mobile appears to be significantly less than with other channels. Just 20% of companies say their efforts with the mobile web are very integrated with their overall marketing activity, with similar percentages for mobile messaging (23%) and mobile apps (17%). With smartphone use and penetration continuing to rise, this indicates that the majority of companies have not been able to integrate their mobile efforts with the other parts of their marketing activity.

[Download PDF to see Graphs]

Across every channel, agencies are less likely to say that their clients efforts are “very integrated” with the rest of their overall marketing activity. This may be because agencies have a different opinion as to what constitutes “very integrated” relative to client-side respondents. However, the pattern remains broadly the same, in terms of which channels are most likely to be integrated.

[Download PDF to see Graphs]

4.1.6. Extent of integration of offline channels

Companies were also asked to provide details on the extent of integration with offline marketing channels.

Figure 14 shows that with the exception of telemarketing and direct mail, companies are more likely to state their efforts are “very integrated” when compared to last year, with the most significant change being for newspapers (+11%). However, with the exception of mobile, companies are more likely to report that their offline channels are “not integrated” with their digital marketing activity compared to online channels (Figure 9).

[Download PDF to see Graphs]

4.2. Acquisition and retention marketing

4.2.1. Area of focus

For many marketers, it is an assumed fact that it is cheaper to retain existing customers than to acquire new ones, particularly in industries where the lifetime value of a customer is a more significant metric than the profit arising from an individual sale.

In order to understand the differing priorities and efforts that marketers have in this area, companies and agencies were asked to provide details on their own and their clients’ marketing efforts specifically in the context of acquisition and retention.

Figure 17 and Figure 18 show that both companies and agency clients are significantly more likely to be focused on acquisition than retention (44% vs. 16% for companies and 58% vs. 12% for agency clients). A substantial number state that they have an equal focus on acquisition and retention with this being the case for 40% of company respondents and 30% of agency clients.

However, when compared against where they think they should focus, far fewer believe they should be focused more on acquisition and instead recognise the need for a balanced approach (Figure 19 and Figure 20). Just 21% of company respondents think they should be more focused on acquisition, compared to 22% who believe they should focus more on retention and 56% who believe there should be an equal focus.

Responses on the agency-side were even more pronounced, with just 15% stating that they believe their clients should be more focused on acquisition.

[Download PDF to see Charts]

4.2.2. Channels used for acquisition and retention

Respondents were asked about whether the channels they used were more geared towards acquisition, retention or both (Figure 21 and Figure 22).

For both company and agency respondents, the channels most likely to be geared towards acquisition were paid search (85% for both client-side and agency respondents), online display advertising (82% for company respondents vs. 80% for agencies) and SEO (69% vs. 70). For both sets of respondents, the channel most likely to be used for retention was email (58% vs. 57%).

[Download PDF to see Graphs]

4.3. Relationship marketing

4.3.1. Use of relationship marketing

With consumers and decision makers having access to more information than ever before, particularly through mobile devices, opinion within the industry is that consumers interact directly with a brand far later in the purchasing cycle; some within the B2B space claim that up to 70% of the buying cycle takes place before the customer ever talks to a sales person.

As such, relationship marketing is an area of particular interest as companies seek to influence the customer at all stages of the buying cycle. Respondents were asked whether they and their clients carry out relationship marketing and what their opinions were on the area.

Around one-in-three companies surveyed (30%) answered that they are very committed to this (Figure 23) with more than one in five agencies (21%) say the same for their clients (Figure 24). The largest proportion of responses was in the area saying that relationship marketing was carried out to a certain extent; 46% of companies and 56% of agencies chose this option.

[Download PDF to see Graphs]

4.3.2. Reasons preventing relationship marketing

Those companies who were not “very committed” to relationship marketing were asked to provide the main reason which prevented them from doing so.

The most commonly given reason as shown in Figure 25 was a lack of resources, with 22% highlighting this as the principal issue. This was followed by no clearly defined strategy (19%) and technology limitations (13%). These three reasons account for more than half of all responses.

Agency responses (with regards to their clients) are shown in Figure 26. The three most commonly cited reasons are no clearly defined strategy (20%), lack of resources (15%) and that they don’t understand the customer journey (13%).

For those looking to champion relationship marketing, the results suggest that those companies yet to commit either have not established a business case (i.e. why resources should be dedicated here) or have not provided a roadmap to drive long term customer value (i.e. a clearly defined strategy).

Vendors and agencies operating in this space can help drive purchasing decisions by providing their potential customers with tools to remove these barriers.

[Download PDF to see Graphs]

4.3.3. Opinions on relationship marketing

In order to ascertain opinions around relationship marketing, companies and agencies were asked to state whether they agreed, disagreed or had a neutral opinion towards a set of statements. Responses are shown in Figure 27 and Figure 28.

The statements which most company respondents agreed with were that it is cheaper to retain than acquire a customer (70%) and that consumers are tuning out from mass marketing (61%). Nearly half (49%) agreed that pound for pound, we achieve better ROI by investing in relationship over acquisition marketing.

The statement which was most disagreed with was we orchestrate interactions based on customer lifecycle understanding. A third (32%) disagreed with this statement, indicating that more needs to be done when it comes to understanding the customer journey and taking decisions based on knowledge of this area.

For agency respondents, answers were broadly similar, as seen in Figure 28. However, one area with a substantial difference was in the proportion agreeing that open rates for email campaigns are declining; 46% of agency respondents agreed with this statement, compared to just 30% of company respondents.

[Download PDF to see Graphs]

4.3.4. Practices regarding relationship marketing

Companies and agencies were also asked whether they agreed, disagreed or were neutral to a set of statements relating to relationship marketing practices. Results are shown in Figure 29 and Figure 30 below.

The questions reveal that around two-thirds of companies (64%) and agency clients (67%) have a campaign-centric approach to marketing.

At the other end of the spectrum, 29% of companies and 40% of agencies disagreed with the statement saying we / our clients collect and make best use of data from multiple channels.

Despite discussions within the industry about “always on” marketing4 and the use of data in driving decision making and action, it appears that many companies are still not adopting best practices in the digital age.

[Download PDF to see Graphs]

4.4. Co-ordinated campaigns

4.4.1. Factors driving effective co-ordinated campaigns

Companies were asked to state what they considered to be the single most important factor which enables effective co-ordination of cross-channel marketing campaigns. The results from this and the preceding year are in the chart below.

As was the case last year, the most commonly cited factor that enables success in this area is a clearly defined strategy, with 37% of companies (up from 28% in 2012) selecting this as an issue. Agencies were also most likely to select this, with 41% choosing this (up from 36%).

[Download PDF to see Graphs]

4.4.2. Integration with email marketing

With email regularly being cited as being among the channels with the highest return on investment within digital5, it makes sense to focus on integrating such a significant driver of revenue with other marketing activities.

The proportion of companies integrating various marketing channels with email is shown in Figure 33 below. The two channels most likely to be integrated with email are website content targeting (65%) and social media (59%).

Figure 34 shows agency responses which are broadly similar to those on the company side. However, one area which has seen a rapid increase in integration for agency clients is in mobile marketing, with 24% (up from 14% last year) saying this is integrated.

[Download PDF to see Graphs]

4.5. Integration of display with other channels

4.5.1. Integration of display advertising with online channels

With marketing attribution and other technologies such as real-time bidding highlighting the value of display advertising, intelligently integrating this channel into other areas of marketing is likely to pay dividends for companies.

In order to explore this, companies were asked whether they integrated display advertising with other digital marketing disciplines. In line with the findings provided earlier in this report (Figures 9, 11, 13 and 15), both companies and agency clients are more likely to be integrating other marketing disciplines with display this year than last.

The most likely marketing discipline to be integrated with display marketing is on-site content management, with 43% stating that this was being integrated now at their companies. The largest increase since last year was in social media marketing, up 6% to 34% this year.

[Download PDF to see Graphs]

4.5.2. Relevant objectives from display advertising

Companies are starting to harness the versatility of display advertising, recognising how it can impact the customer journey in a number of ways.

In order to understand why companies are using display advertising, we asked them to state which display advertising objectives were relevant for their company. Results are shown in Figure 43 below, with agency responses shown in Figure 44.

The two most commonly cited display advertising objectives for both companies and agency clients are increasing brand awareness (78% company, 73% agency) and driving acquisitions (76% company, 69% agency).

Of note is the large increase since last year in the number of companies who use display advertising for extending conversations to individuals who aren’t opted in, with 43% having this objective compared to just 22% last year.

With retargeting technology enabling brands to communicate with unknown customers that have indicated a propensity to buy (e.g. through using certain search terms or previously having viewed content on site), and real-time bidding enabling the most effective use of media spend, it is not surprising that there have been some significant changes in the objectives cited by companies in this area.

[Download PDF to see Graphs]

4.5.3. Types of information used to target customers

Companies have access to potentially more information than ever before as their customers leave an electronic footprint of data that can be harnessed to formulate insight and make decisions that increase revenue.

With such a broad range of first- and third-party data and information potentially available, it is surprising to see that, in the context of display advertising, not a single type of data or information is used by more than half of companies or agency clients.

The most popular type of data or information used by both companies and agency clients is onsite browsing behaviour, with 46% of companies and 50% of agency clients using this as part of their display advertising campaigns to target customers more effectively.

[Download PDF to see Graphs]

4.6. Mobile

4.6.1. Integrating mobile into marketing campaigns

With smartphone penetration now at well over 50% across most of Europe and North America,6 there has been a growing discussion within marketing about how best to optimise the customer experience across this channel, particularly as it plays a growing role within many customer journeys.

As shown earlier in the report in Figure 1, there has been a substantial increase in the number of companies who use the mobile web for marketing.

Companies and agencies were asked to state whether they or their clients had a strategy for integrating mobile into their broader marketing campaigns. Around six out of 10 on both sides (60% for companies, 58% for agency clients) have some sort of strategy, but just 15% of companies and 12% of agency clients say this is very much the case.

While that still leaves 40% of companies without a strategy for integrating mobile into their broader marketing campaigns, this has reduced from 51% last year, indicating that companies are moving in line with this significant customer trend.

[Download PDF to see Graphs]

4.6.2. Types of mobile advertising

Figure 49 and Figure 50 illustrate the types of mobile advertising that companies and agency clients are engaged in.

Positively, there have been significant increases across every type of mobile advertising for the past year. For both companies and agencies, the largest increase has been in mobile display advertising (rising 23% to 48% for companies, and 41% to 55% for agency clients).

[Download PDF to see Graphs]

4.6.3. Types of mobile solution

Figure 51 shows the type of mobile solutions currently deployed by companies.

While 49% use none of the listed solutions, the three most commonly used solutions are email acquisition (23%), customer service (19%) and promotional alerts (15%).

For agency clients, the most commonly deployed mobile solutions are email acquisition (30%), competitions (26%) and customer service (24%). Around a third of agency clients (34%) do not deploy any of the stated mobile solutions.

[Download PDF to see Graphs]

4.6.4. Customer engagement via smartphones compared to PCs

Since last year, there have been no significant changes in the reported level of customer engagement with display advertising via smartphones compared to PCs. Details are shown in Figure 53 and Figure 54 below.

In addition, there seems to be no huge differences in opinion between the client-side and supplyside, although companies are slightly more likely to believe that customers are less engaged with display advertising when using a smartphone compared to a PC.

[Download PDF to see Graphs]

4.6.5. Customer engagement via tablets compared to PCs

One item of note when comparing engagement of tablet users with display advertising (Figure 55 and Figure 56) is that fewer companies and agencies believe that consumers are less engaged when they are using tablets (than is the case with smartphones as shown in the previous section).

[Download PDF to see Graphs]

4.7. Resourcing campaigns

4.7.1. Level of involvement

Company respondents were asked whether or not they were personally involved in the development and execution of digital marketing campaigns.

Nearly three quarters (73%) of those surveyed said that they were.

[Download PDF to see Pie Chart]

4.7.2. Time spent on areas of digital marketing

In order to find out where marketers were spending their time, companies were asked to detail which channels were the most time-consuming for their team.

The most time intensive channels are listed as email (56%), website (50%) and social media marketing (39%).

There appears to be a strong degree of correlation between what channels and disciplines are actually used by companies as part of their marketing efforts (Figure 1) and where they are spending their time.

For agency clients (as shown in Figure 61) the most time-consuming channels are listed as social media marketing (43%), website (43%) and email (36%).

[Download PDF to see Charts and Tables]

4.7.3. Areas that take up too much time

Companies and agencies were also asked an open ended question about which area of marketing they believed was taking up too much time. A word cloud illustrating their responses is shown in Figure 74.

[Download PDF to see Figure]

Common themes included data, content and reporting. However, the key issue among many of the responses appeared to boil down to either inefficient (or a lack of) technology, or internal issues which took too much time to deal with.

In addition, it appears that many processes that take up too much time are those that have not yet been automated by companies. While setting up such automation may involve an up-front cost, the investment over time is likely to reap rewards in terms of improving organisational efficiencies.

Agency responses were broadly similar, with many of the same areas and issues identified.

4.7.4. Areas that would benefit from more time

Figure 75 below shows company responses to the question “Is there any area which you feel would benefit from more time? Why?”

Common themes which emerged were evaluation, planning, testing and strategy.

Evaluation was often mentioned in terms of the missed opportunity that occurs when it is not properly carried out, particularly in the context of iterative improvements which come from an improved insight. For the same reason, testing was often mentioned.

Planning and strategy often came up in the context of not setting clear objectives which highlighted the route to business success.

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[Download PDF to see Appendices]