The State of Digital Marketing 2021

The state of digital marketing 2021

Back to basics but with new technologies 

Digital marketing: past, present and future

How has it changed, what state is it in now, and what will the future bring?

Past

As Avantika Monnappa wrote on Dec 23, 2020, in The History and Evolution of Digital Marketing:

“The digital market is in a constant state of flux. A Digital Marketing professional must find ways to keep up with this change. They need to be able to keep an eye out for emerging trends and the development of newer and smarter Search Engine Algorithms. After all, nobody can afford to get left behind in this race.”

Present

The state we're in

What's goin' on in digital marketing?

Coronavirus may have been bad for the world, but was it good for digital marketing?

Digital marketing had already been growing exponentially in recent years, pre-pandemic, but since the lockdowns were enforced, companies had to go online to survive (which included greater budgets for investment in marketing) and as a result, digital marketing thrived more than ever.

Every cloud has a silver lining 

Can a day tell the story of a year?

“Black Friday Was a Bust for Many Stores, Better for Online” read the headline of The Wall Street Journal article by Sarah Nassauer and Suzanne Kapner (Updated Nov. 29, 2020):

“U.S. shoppers went online to purchase holiday gifts and score Black Friday deals they once crowded into malls to grab, as the coronavirus pandemic accelerated the yearslong remaking of the U.S. retail landscape.

Roughly half as many people visited stores on Black Friday as they did last year, according to research firms that track foot traffic. Meanwhile, online spending jumped 22% from a year ago, making it the second-best online shopping day ever measured by Adobe Analytics.”

So what's trending in digital marketing?

In Ashley Friedlein’s digital & marketing trends 2021 (January 11th, 2021) he writes that:

“Whilst far from new, the Coronavirus pandemic has given the need for digital transformation a new urgency that, for many businesses, is existential.

The pandemic has accelerated digital trends that were already underway by five to ten years. A Twilio study of 2,569 companies published last summer found that, on average, COVID-19 accelerated their digital communication strategy by six years. McKinsey shared data that showed that in three months of 2020, US e-commerce penetration grew as much as it had in the past ten years, and in the UK e-commerce’s share of retail, excluding groceries, surged to 40% leapfrogging five years of predicted growth.

2020 saw a digital transformation in the enforced switch to digital ways of working. This had an impact on culture and process also. Many companies, particularly large ones, perhaps surprised themselves in their ability to adapt when forced to and this may give them the confidence to drive through changes yet to come in 2021 and beyond.

Digital marketing investment 

Unsurprisingly, ad spending on traditional media is slipping (or at best stagnate). So where is the money going?

You guessed it.

Image courtesy of AdAge.

“As advertising on traditional channels like TV, radio and newspapers decline, many brand managers are turning to the internet for a new audience—specifically mobile phone users,” writes Ted Kitterman in his article for PR daily Mobile marketing drives digital ad spending.

Friedlein says that: “Investment in technology, digital infrastructure, and digital marketing, will, of course, continue in 2021 but the biggest investments in digital transformation this year will be in capabilities, particularly people and skills, that can deliver a new operating (and often, business) model. As I wrote in 2013, digital transformation is really business transformation. Whole industries will be busy transforming their go-to-market offerings over 2021:

Retailers, and others, will be going all in on e-commerce.

Brands and manufacturers, including B2B, will also prioritize direct-to-customer digital and e-commerce routes to market.

    Media businesses will be accelerating away from physical media and ad-funded models towards digital and subscription/membership offerings.

    Events, training, education… will all be moving to ‘hybrid’ digital/physical propositions.”

Digital budgets

How much are companies investing in digital marketing? Now compared with before the pandemic

Despite the increased need for digital marketing during the pandemic, that boom was tempered by the overall economic downturn caused by lockdowns and curfew policies, which had knockon effects for companies' revenues and subsequently budgets in general, not only those in the marketing sector.

Against that, however, Mark Ritson (6 Apr 2020) argues that:

“The best marketers will be upping, not cutting, their budgets

It may seem like a paradox, but recessionary periods actually provide fertile grounds for marketers to grow their brand’s market share if they’re prepared to think long-term.”

Ashley Friedlein thinks “The harsh economic climate of 2021 has mixed implications for learning and skills development in marketing. On the one hand, investment in training by organizations may be de-prioritized to save money. On the other, given budget cuts, hiring freezes and redundancies, there is pressure on businesses to reward and incentivise remaining marketing talent with investment in their careers through training and development.

In practice, from an organization’s point of view, 2021 will see the winners in the economy investing strongly in learning and talent and this will see them pull even further ahead of the laggards in the mid and long term. The same is true for investment in media and brand marketing more generally.”

Future

The shape of digital marketing things to come

Prophets: will the experts' predictions be proved true or false? 

The future's not ours to see...but a good forecast can help get the edge over your rivals 

By looking at future predictions we can see trends from the present and recent past being exaggerated and extrapolated but in a positive way by professional marketers, who tend to be quite optimistic about the future. Seekers of digital dystopias have Black Mirror to devour. 

Which of these forecasts will come true and which will be most useful for you?

What should you prepare for and be ready to take advantage of before your competitors strike first?

To get ahead you need to see where the bandwagon is headed, instead of jumping on late and not knowing where it's going.

The first predictions regarding privacy and data protection determine later predictions relating to creative content.