What's Changing (and What Isn't) in 2023
2023 is upon us and the growth marketing word of the year is already ROI. As economic uncertainty and tempered consumer spending continue, marketers are adjusting their growth strategies to prioritize a healthy bottom line. Moreover, the ongoing trend toward increased online privacy and limited browser tracking will require marketers to expand their playbooks and test creative new ways to reach and connect with their target customers. In this post, we’ll look at five growth marketing trends that are likely to dominate 2023 and provide insights into how brands can adapt to these changes.
Trend 1: Marketers Shifting Focus to ROI and Sustainability
This shift started in 2022 as businesses responded to increasing economic uncertainty and rising interest rates, and it will continue in 2023. Business leaders are preparing for the possibility of a sustained slowdown, and adjusting their strategies to increase LTV, decrease LTV payback periods, and conserve cash to weather a potential storm.
For marketers, the growth-at-all-costs approach of recent years has taken a back seat to sustainable, responsible growth. That means measuring the success of marketing programs by their profitability, and building an acquisition strategy that is supported by–but not completely dependent on–paid direct response ads.
Trend 2: Omni-channel Marketing: Reducing Reliance on Meta
While Meta remains an important DR marketing channel, high competition and iOS tracking limitations on the platform have driven decreases in campaign efficiency and conversion volume for many advertisers. Brands will need to diversify their marketing mix and dedicate budget to testing and experimentation across new channels to build a robust and sustainable growth program.
Performance-focused growth marketers should maintain a strong core marketing mix that includes Meta, SEM, YouTube, Affiliate, and SEO, and look to expand to: TikTok, Google Performance Max and Discovery, YouTube Shorts, and Sponsored Editorial Content (more on this strategy below). Ecommerce advertisers can also take advantage of Google Shopping and Amazon PPC to drive efficient sales growth.
With that said, Meta is still one of, if not the most effective channel for customer prospecting at scale, and will remain a large part of marketers’ paid channel mix. And there may be some bright spots for Meta this year. It’s true that Apple’s App Tracking Transparency reduced targeting effectiveness, driving advertisers to pull back on ad spend. However, this could actually prove beneficial for advertiser costs on the platform in 2023. Average CPMs on Facebook were 19% lower in 2022 than in 2021, and that trend has continued into 2023 so far. January and February of 2023 saw CPM decrease by 25% and 11% respectively compared to a year prior.
Trend 3: Creator Marketing Will Continue to Grow
TikTok’s popularity has led Meta and Google to create copycats in Reels and YouTube Shorts. That’s led to an explosion in creators making high quality, engaging, native video content, and marketers leveraging those creators to help build their brands.
Creator marketing is powerful for a number of reasons. Its familiar, native style of ad creative can garner more, and higher quality, engagement from users inclined to scroll right past more traditional ads. It also allows brands to build trust and credibility with their audience by partnering with users who have already built up a following in their particular niche.
The major ad platforms are fully embracing this strategy, and rolling out tools to help brands connect, collaborate, and manage partnerships with creators. Advertisers can leverage Instagram’s Creator Marketplace, TikTok’s Creator Marketplace, or YouTube’s Brand Connect to browse and connect with creators relevant to their audience.
Trend 4: Sponsored Editorial Content is on the Rise
High inflation led consumers to be more prudent with their spending last year, a mindset that is unlikely to change in 2023. Sponsored editorial content can help marketers build credibility through third party endorsement, and give customers an in-depth look at their brand and value props through long form blog posts and reviews. Publishers are creating informative, entertaining content that builds trust and helps customers make more informed purchasing decisions.
Marketers can supercharge the impact of sponsored content with strategies like Whitelisting and Branded Content. Whitelisting allows brands to deploy ad spend behind 3rd party editorial content posted from the publisher’s Facebook and Instagram accounts. This allows them to drastically increase the reach of a positive article or review, while maintaining the credibility of an unbiased publisher endorsement. Branded content is similar, but makes the partnership more explicit with a “handshake” between the brand and publisher.
Both of these strategies drive extremely compelling results. A Facebook analysis of 12 North American Ecommerce conversion lift studies found that branded content campaigns drove an average 57% increase in sales lift with 99% confidence. And whitelisting programs nf&co. have run for our clients have driven 40% higher engagement, and decreased CPA by up to 51% compared to standard branded ads.
Trend 5: An Effective Testing Strategy is More Important than Ever
As channel portfolios grow and marketing programs become more complex, an effective testing strategy is even more crucial, and even more challenging to manage. More complexity means more opportunities to test and optimize, and more potential wins. But without a thoughtful, methodical, scientific approach to testing, you’re setting yourself up for failure. A few keys to an effective testing strategy:
1) Every test should start with a written hypothesis. This is the outcome you expect from your test, stated as a cause/effect. It shouldn’t be overly complicated. For example: “Moving the sign-up button above the fold will increase sign-up conversion rate.” The goal of your experiment is to prove or disprove this statement. (Either outcome is considered a successful test. As long as you have confidence in the result, you’ve learned something that can help you make better decisions going forward).
2) Before you start testing, formally document the following:
- Rationale - Why are you testing this particular variable?
- Structure, Measurement, and KPIs - How will you set up the test, how are your test cells defined, and which metric will determine success? Defining these parameters up front will help ensure that you’re not left with an inconclusive result due to a poorly executed test.
- Test timeline and budget - How long will your test run, and how much of your marketing budget will you dedicate to testing?
3) For A/B tests, use Bayesian methodology (use an online calculator like this one from abtestguide.com) to reach a conclusive result quickly.
This approach solves for the probability that Test Cell A will outperform Test Cell B in the long run. It’s important to note that it doesn’t specify the exact percentage lift in performance. However, what is lost in specificity is made up for by the ability to make faster decisions that improve performance for your business. The sooner you can shift ad spend toward a higher-performing asset, the less money is wasted on inefficient variants.
Ready to level up your marketing strategy, and build a growth program poised for success in 2023 and beyond? Get in touch with our elite team of marketers at nf&co. for a free growth consultation. We can’t wait to build something amazing with you.