Managing Digital Marketing in 2016: Best practices for integrating digital technology, marketing and media to fuel business growth

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This research from Smart Insights and Technology for Marketing (TFM) explores approaches businesses use to plan and manage their investments in digital marketing. Findings and recommendations are grouped in 5 areas aimed at improving the commercial contribution of digital marketing for businesses.

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1. Digital marketing capabilities and transformation

The majority of the 1096 companies surveyed are still actively working on transformation of their digital marketing capabilities – less than 20% rating their digital communications, customer communications or performance improvement process at an advanced level. When asked about managing digital transformation, 32% of businesses had a transformation programme in place, with 34% planning to implement a programme within the next 12 months. This represents a considerable increase on last year, when less than 20% of businesses had a transformation programme in place.

Good practice: Audit your digital marketing capabilities and create a roadmap for digital transformation to improve capabilities over the medium to long-term.

2. Digital marketing strategy and planning

In business, it’s recognised that plans help companies to prioritise, set goals and allocate resources to meet targets. Yet a planned approach often isn’t followed in digital marketing or marketing:

  • Nearly half (47%) of businesses surveyed do not have a defined digital plan or strategy, although they are active in digital marketing.
  • Likewise, nearly half (44%) don’t have a clearly defined marketing strategy...
  • Good practice: Don’t just execute! Create a long-term integrated digital strategy and plan aligning with marketing and business priorities.

3. Improving integration with digital transformation programmes

Integration of digital channels into marketing activities was identified as a major challenge in the research – only 17% of companies were happy with the level of integration.

Good practice: Use digital transformation programmes to eliminate digital marketing silos and improve integration through integrated planning and collaboration during campaigns and ‘always-on’ marketing activities.

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4. Investing in digital marketing in 2016

The research focused on discovering which channels marketers rated as delivering the greatest ROI, this being the most critical metric for most marketing departments, and key to justifying further spend. Email marketing performed the best, with 80% saying it delivered medium to high cost effectiveness. Similar to last years survey, email was followed by SEO as the next most cost effective technique (71%). Interestingly, whilst AdWords came third in our survey last year, it has slipped to being the fourth most effective channel, as organic social media has risen to be perceived as moderately to highly effective by 69% of marketers.

Good practice: With the diversity of paid, owned and earned media, it’s important to focus resources and optimisation on core channels that drive value.

5. Innovation and optimising digital marketing

The opportunity to dynamically update and test digital media has always been claimed to be one of its main benefits compared to traditional media, so we were interested to see to what extent companies have processes in place to execute this continuously. On average, roughly 20% of businesses were not using any form of optimization tests, meaning four out of five companies are using them. Desktop websites and Emails were the forms of digital media most likely to have optimization tests carried out on them, with social media not far behind. There was a lot of room for improvement with marketers use of optimization tests, as the majority were using limited or intermittent optimization, with only one in 10 engaged in continuous optimization.

Good practice: You can’t compete if you update your website or your communications approaches every few years... Create a plan for “Always-on” optimisation of digital media and integrated customer experiences.


The need for managing digital transformation

Late last year, Smart Insights quoted PepsiCo Exec Brad Jakeman as saying that digital marketing was ‘the most ridiculous term he’d ever heard’. Instead, he argued that although digital is often discussed as an afterthought, it should permeate everything marketers do. He added “There is no such thing as digital marketing. There is marketing - most of which happens to be digital.” Similarly, Amanda Rendle of HSBC says that she has ‘banned the term digital’ in her team, to encourage a more integrated approach. We can see they believe they need to take this stance, but the reality we see is that digital marketing presents such an opportunity (and challenge) to businesses that it needs to be managed proactively. Our Managing digital marketing skills report shows that more than half of all marketers’ time is now spent on managing digital marketing. Surely this mean digital marketing has to be acknowledged with specific skills developed and digital transformation plans are needed so that, in the longer-term digital marketing is fully integrated, so it is part of ‘business-as-usual’

In a Google Think article, A “Post Digital” World, Really? Y&R Chairman and CEO David Sable argued against those commentators who said that businesses and consumers are now in a “Post Digital” world. We concur. You will see from the results of this survey that the reality for many businesses is that despite widespread adoption of digital technology by their customers and some of their advanced competitors, we are still in an era of managing transformation to improved digital capabilities. Many businesses are limited in their capabilities and currently lack plans to integrate digital effectively. However, there is a strong appetite to improve their approach to digital marketing using digital transformation and increased investment in digital media and technology.

Research aim and methodology

At Smart Insights we believe that successful marketers look beyond chasing every latest technology innovation, instead developing a more strategic, yet agile, managed approach based on optimising communications for key customer touchpoints. So, in this research we wanted to go beyond reviewing the digital marketing tactics deployed and explore the strategic approaches businesses take to manage the transformation needed to improve the commercial contribution of digital marketing integrated with all marketing activities.

To achieve this aim we surveyed Smart Insights members who are based around the world and attendees of TFM, eCommerce Expo and Customer Contact Expo who are based in the UK and Europe. The survey was completed online during March to April 2016. Thank you if you took the time to share your experiences of digital marketing.

There were 1190 respondents, although the majority were from the United Kingdom or the United States. Respondents were marketing managers of various levels of seniority. Further details on the sample frame are available at the end of the report.

1. Review digital marketing capabilities and implement digital transformation

Does your company have the right capabilities in place to make the most of digital marketing?

Whether companies are able to deliver on the potential of digital channels to contribute value depends on whether they have the right capabilities in place across the company to mange all the digital touchpoints to reach, interact, convert and engage their audiences.

We asked companies to rate their digital capabilities from an initial level, 1 through to an advanced ‘optimized’ level of 5 by referencing the capability assessment shown on the next page. Results show that the majority of companies rate their capabilities at lower levels of 1 to 3 on this scale of 1 to 5.

Since digital marketing involves execution of many marketing processes and activities, it’s useful to rate different types of capabilities by their current effectiveness as shown by our capability review below. To download a larger version of the capability matrix go to or use our interactive benchmark in the members area.

Scoring your digital capabilities can help show colleagues your current use of digital marketing and how far you need to go. This can help prioritisation of future improvements. The weakest processes that are important for future improvement can be identified and prioritised. Creating a roadmap is a great way to show that Digital Transformation is a long-term journey and can’t be achieved overnight, or without sufficient investment.

Adoption of digital transformation programmes

Organisations who recognise the importance of digital media and technologies in the future and seek to accelerate the rate of change to integrating digital marketing into their business create digital transformation programmes.

To find out the commitment to digital transformation we asked respondents about their current adoption of digital transformation programmes. The results, shown on the next page, show that nearly one third (33%) of businesses already have a transformation programme in place, with many businesses still looking to launch their digital transformation programme.

A significant proportion of organisations have no intention to implement a programme because they feel it is inappropriate for their type of business, for example, startups and smaller businesses or businesses who are online pureplays. It is interesting how small a percentage have had a programme in place for over two years. This highlights that many businesses are still in a period of transitioning to being ‘digital first’, and the process of digital transformation is far from finished.

Developing Integrated Strategies and Plans for Digital Marketing

Is digital marketing based on a planned approach?

We believe that to gain the most from digital platforms, a structured, planned approach based on a solid strategy will give the best results. Plans help businesses to prioritise, set goals and resource at the right level to hit targets. Without structured plans, there is a danger you will be subject to “shiny object syndrome”, always chasing your tail, as Jeff Bezos of Amazon has referred to. We found that a majority of organisations responding to the survey do use a planned approach to digital marketing, but almost half still don’t. We’ve seen progress compared to past years in integrating digital marketing strategy with that of the overall marketing plan. Previous years saw larger percentages defining their strategy in a separate document.

Shockingly, nearly half of businesses do not have a digital marketing strategy, but they are doing digital marketing. Perhaps this is not surprising since we also found that 44% of businesses didn’t have a marketing strategy to align their digital strategy with.

How should digital marketing and traditional marketing be integrated?

As discussed in the introduction, there is a risk that separate digital marketing plans and teams lead to silos for digital marketing, so it’s important to think about how you manage integration. The research shows marketers are making solid progress towards integration, although relatively few describe their approach as fully integrated.

Only 5% of companies thought their integration process was completely optimised. Yet there is reason to be optimistic about the state of marketing integration. A third of respondents reported that they were making solid progress, and overall 50% of businesses were happy with their integration efforts, compared to just 25% in last years survey.

Integration requires a clear marketing or business strategy and plan also. The survey results suggests that lack of a marketing plan in a substantial proportion of organisations may make it difficult to align a digital plan against!

How should you go about optimising your customer journey?

We have seen how there is a major challenge for many marketers of creating integrated strategies and communications plans. From a customer point-of-view there is also likely to be a poor experience if their customer journeys are unclear or restricted by the inability of brands to integrate their communications and experiences.

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A focus on improving customer journeys by businesses can help resolve customer journeys. We see a key trend in 2016 as a focus on customer journey effectiveness. Marketers are starting to realise that experience is what counts, with thought leaders like Brian Solis of Altimeter urging markets to realise that your customer experience is your brand.

In our customer persona toolkit we show how different techniques such as customer persona development, customer journey analysis and content mapping can be used to review and improve digital experiences in conjunction with conversion rate optimisation. Since improving your customer journey can be one of the most effective way to boost online leads and sales and bottom line. With that in mind, we asked respondents which techniques their businesses were using to research and improve the effectiveness of their customer journey.

AB testing is clearly the most popular way marketers assess the effectiveness of their customer journeys, as it’s easy to carry out and leads to actionable results. Yet a relatively small proportion of businesses are using this technique and others such as persona analysis and customer journey mapping. What’s more, often A/B tests are too simple, and multivariate testing is needed, yet only 5% of marketers are engaged in this form of testing when it comes to their customer journey. We recommend managers invest in their teams skills and in tools to help them conduct tests for effectively. Only with testing can you get the data you need to optimise your customer journey.

How effective is Marketing Automation in 2016?

Marketing Automation grew massively in popularity in 2015, and is coming of age in 2016. A separate survey by Smart Insights discovered that marketers rate marketing automation as the 3rd most important marketing trend of 2016. For this report, we asked marketers to rate how well they are currently utilising marketing automation tools, with some interesting results. The vast majority of marketers were using at least some marketing automation tools, as only 24% did not use it. However many were just using the basics, and only 15% rated themselves as using all or most of the features. Therefore there is clearly a big scope for improving company use of marketing automation in 2016. Managers should address any skills shortages on their teams by investing in training to let staff get the most out of the systems that are already in place.

Investing in Digital Marketing in 2016

Which are the most effective digital marketing channels to invest in?

To assess your investments in digital media we recommend you take a look at our Content Distribution matrix.

The chart shows that Email marketing leads the pack in terms of perceived cost-effectiveness, with SEO not far behind. Social Media comes in third this year, just beating AdWords, which had been 3rd highest rated in previous years.

The assessments by marketers of channel effectiveness are consistent with the patterns reported for driving visits across websites reported by SimilarWeb - you can use this tool for comparing to competitors. The chart below for the retail Ecommerce sector shows that search and direct visits are the main traffic drivers, with Social media marketing and display relatively low. Email is included within the referrals category in this example - so this can’t be compared to the reported data from marketers in our study.

Considering another data point, Custora’s Ecommerce Pulse, a compilation of traffic sources for online retail sales, we can see a similar pattern where paid and organic are really important. You can see that email marketing is really important here, since this will include customer orders prompted by email marketing.

Use of data for targeting

We also looked at innovation in using data for targeting. The results show that, overall businesses are long way from the 360 degree customer view and personalised customer lifecycle marketing that many have discussed for a long time.

4. Innovation And Optimising Digital Marketing

Are marketers managing digital marketing activities continuously?

The opportunity to dynamically update and test digital media has always been claimed to be one of its main benefits compared to traditional media, so we were interested to see to what extent companies have processes in place to manage this continuously. The concept of Always-on marketing has emerged to show a change in emphasis of investment in marketing activities from burst marketing campaigns to generate awareness and response to continuously driving demand for products and services as consumers search and review products and services. Real-time marketing is also part of ‘Always-on’ since marketers can deliver more relevant content that is being discussed in social media and by word-of-mouth.

For Always-on marketing to be effective, testing, review and optimisation are essential to increase the effectiveness of different digital channels. We explored the use of digital marketing optimisation through a question which reviews the use of testing across channels. The response to this question shows a core group of respondents have moved beyond intermittent to more regular structured testing and optimisation programmes.

A relatively small proportion (around a third of companies) have embraced optimisation with these leaders running frequent tests or continuously optimising. The percentage of leaders who optimised individual channels using continuous optimisation or structured tests were at similar level to 2015.

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