The year 2022 may not be remembered as one of product launches or major innovation in ad-land, but it did offer a few surprises for those paying attention. We saw significant advertiser expansion into short-form video, with brands (and their influencer ambassadors) creating hours of authentic “messaging on the move” for Tik Tok and Facebook Reels audiences. Meanwhile, the popularity of Connected TV and the draw of live-streamed sports events like the World Cup reminded us that streaming video remains a treasure trove of opportunity for collaboration – and consolidation. In a telling example, Disney+ and Netflix introduced versions of their own programmatic ad networks last year.
The truth is, if companies are too focused on what’s happening at the lower end of the funnel (i.e., last click attribution), they will miss what’s happening at the top. While it’s important for companies to leverage rapidly emerging technology that can refine data influx and maximize targeting capabilities, the best long-term growth strategy is to invest in brand building. In 2023, the brands and companies that are honing in on what makes their customers tick will find themselves at the front of the pack from a market share perspective.
The media fragmentation unfolding before us – just as the first-party data era is dawning – naturally obliges those closely watching advertising and marketing efforts for a sign of market optimism to stay hyper-focused on where consumer attention is concentrated.
“Be Greedy When Others Are Fearful”
This advice from value investor, Warren Buffett, sums up the contrarian position behind “buy low, sell high” – the only investment strategy that has stood the test of time. Contrarian investment also applies to marketing and ad budgets. When others are fearful, retreating from brand-building activities, it’s time to be greedy. The result will be increased market share and customer affinity.
Profit margins may be getting squeezed across the board, but there are more strategic ways of justifying spend than simply watching what drives clicks. Last-click attribution will still yield diminishing returns and customer attrition if a brand has stopped investing in the upper funnel, which matters as much (if not more so) than cold, hard numbers.
While many obsess over the companies that are prioritizing optimization, investors should consider if the time is right to break from the herd and take stock of the bigger picture and longer term gains. Knowing that personal connection is at the core of marketing success, investors need to pay attention to the brands identifying what matters to their customers– and harness those learnings into actionable insights.
Quantifying Brand-building Efforts
Marketing is a delicate balance between art and science. Emerging technologies can quantify how successful brand-building efforts are, from facial coding to micro-expression analyses. These insights are collected primarily via wearable technology, a global market worth about $122 billion in 2021 and expected to surpass $392 billion by 2030. Where once marketing was considered a pseudo-science by academics, the industry now has the science community’s interest piqued. So what makes this technology so appealing?
Wearables in the consumer research space, such as headbands, have until recently tracked eye movement, which allows researchers to gauge viewer attention. But advancements to the technology indicate we are entering whole new era of neuromarketing applications for biodata. Now, scientists can gauge viewer affinity for content, opening a portal for brand owners to fine-tune ads based on consumer emotion and memory, thus driving more effective engagement.
With consumer appetite to share information at an all-time high, the opportunity to trade insights for value is here. The most successful marketers (and brands) in 2023 will be those who can connect the dots between building a rapport with new customers and creating hyper-personalized purchase moments for them by utilizing technology like these new wearables—this is where market value will be created. We will see the wearable space continue to grow, and brands engaging with these technologies will surely see a return on investment.
Many companies have lost sight of connecting with consumers in a way that moves the business forward for the long term. In a market obsessed with attribution, the companies following the contrarian model of customer-first brand building will likely see affinity and market share grow in conjunction. Creating and demonstrating value is the only strategy that’s stood the test of time. To maximize value, it’s necessary to focus on understanding customer connections. Brands coupling what they learn with the latest tech rooted in consumer psychology and human emotion will demonstrate value for their investors.