2023 marketing trends

Sustainability will become a marketing mainstream

Consumer demand for sustainability in products and services has increased significantly since the beginning of the global pandemic. We are not just talking about intent here – customers want real evidence of our sustainability credentials, or we risk being branded a ‘greenwash’ organisation.

As custodians of the customer communication strategy, we need to rethink the current models we have in place and make sure that we change the agenda from one of acquisition and retention to whole product lifecycle. This comes with the need to extend our thinking around the data we collect and use, types of communication we engage in, and the channels and materials we consume as part of that communication strategy.

Some organisations embraced this change and already have communication strategies that cover sales and service cycles. Now they are having to adjust these programs to consider new business models and to be more agile in recognising what consumers really want and need.

As far back as 2015, long time SAS Customer Levi Strauss signposted its intent to build a circular economy model. In the company’s own words: ‘Circular business models can deliver value through strategic growth and innovation. Circular products offer the potential to mitigate risks across supply chains by using more sustainable fibres and fabrics made with safer chemicals, less water, less energy and less waste.’

Adopting business models, such as Levi’s, provides massive opportunity to marketers in terms of building consumer relationships in a different way. Imagine developing a loyalty program that is based not on points or cash values, but on the measurement of a consumer’s sustainability credentials and achievements. This is true across all industry sectors from financial services to retail. Is the mortgage product you offer your customer truly eco-friendly and sustainable? Can you support your first-time buyer in being carbon neutral? Imagine, as a retailer, being able to differentiate between individual customers when you use the term ‘locally sourced’: for one that could be within 5 miles of the store, for another within the same region of the country.

Consumers are waking up to the need to protect and nurture our planet. As marketers we have a strong opportunity to support and guide them in achieving this aim, which in turn builds our brand credentials with our core market.

Real-world and digital-world merger will accelerate at pace

Almost every marketing prediction in the last five years has suggested that this will be the year that augmented reality, or virtual reality, become mainstream marketing tools. Every year that doesn’t happen. A few brave souls forge the path and experiment with these technology platforms, but we are still a long way from seeing these channels become part of the mainstream marketing mix. Will 2023 be any different? Probably not, but there is an exciting and more tangible trend in the world of digital that is becoming a reality.

Many mainstream brands are experimenting with the metaverse, not just niche players.  Organisations such as Nike have made major investment and commitment to this new channel. This new world is a confusing set of technical ideas for marketers, many of whom are working on the incorrect assumption that the Metaverse and Web3.0 if not the same thing, are at least interchangeable. In very simple terms, Web3.0 represents a vision for a democratized version of the internet, decentralized and more collaborative. A metaverse is best thought of as a virtual world in which a marketer can focus on the user experience. It is in this virtual world that we will most likely see the growth of AR/VR marketing strategies.

What is Nike trying to achieve in the metaverse though? At the end of 2022 it launched a metaverse play called Swoosh. The platform will initially focus on community building and present members with ‘challenges’ to get a sense of what members want to see. The brand’s first virtual collection of footwear, apparel, and accessories will launch on Swoosh in January 2023, shaped by activities such as interactive voting. Members will subsequently be able to collect and trade these digital-only products. The platform will use cash (USD), not cryptocurrency, though all transactions will be recorded on the Polygon chain. They also have an existing metaverse space on Roblox (Nikeland) where users can buy and wear virtual goods for a cash value. Other premium brands such as Gucci (Gucci Town) have also moved into the metaverse. Does it work and deliver value? In 2022, a Gucci bag sold in Gucci Town for more than its physical counterpart. Of course, this purchase was for in-game currency.

A digital–real-world merger is not just about VR/AR or the metaverse. We are seeing increasing numbers of IoT enabled devices, growing use of virtual and digital meeting platforms in customer communications, and the emergence of more of these technologies in our bricks and mortar offices and stores.

Marketers will therefore need to think about more collaborative marketing strategies, inviting their consumers to experience products and services through new environments rather than engaging consumers in price point or feature/function comparison strategies. For organisations with products that often have large gaps in their communication programs, opening these new channels offers a valuable opportunity to engage with consumers more often and on topics that are not just related to the subscription or renewal of a particular service offering.

The dawn of data realization

What underpins and fuels the changes we see coming in 2023? It’s data of course.

Data needs to be about more than just the customer. In 2023 this realization will drive a change in the fundamentals of data strategy.

Until now, marketing and communication practitioners have aggressively pursued the collection of data relating to individual customers with the hope or belief that by applying artificial intelligence (AI) to that data they will be able to communicate on a personal level with every customer that touched their ecosystem. What many organizations now sit on is a highly curated view of data about some of their consumers, but it often misses elements of the consumers’ interactions with the brand, or simply cannot assimilate the data quickly enough to make it useful or, in some cases, usable.

In 2023, the collection of data to support understanding of additional concepts, such as context, environment and value drivers, will gather pace. AI techniques previously only applied to collected customer data will start to be applied to other data, such as content management systems, promotional offers and even collaborative or third party data.

This will drive a change in the collection and curation of data across organizations, which in turn will drive the delivery of more comprehensive ‘data fabrics’ to support the engagement of every customer with a much more detailed understanding their individual needs. Data strategists will emerge as key players in this world, working closely with data science and communication teams as we strive to deliver ‘actionable’ insights, through the right channel with the relevant content at the best time.

Next Best Engagement instead of Next Best Action

2023 will see marketers move away from the rigid thinking engendered by Next Best Action strategies. They will start to experiment with Next Best Engagement as a more productive and efficient means of delivering a contextually rich message, at the right time, on the right channel.

The realization that consumers want to engage in different ways across different channels is of course nothing new, but enlightened marketers have started to understand the potential limitations of the NBA approach and are actively seeking alternative ways to drive effective communications with consumers.

Next Best Action is predicated on the idea that we have a journey we want a consumer to proceed along. We are looking for indicators of their position on that journey so that we can prompt them to take the next step with a timely message or offer. By its very nature, NBA activity is focused on a product or service sales process and is centred on the business line looking for consumers to whom they can sell the product or service. This represents an outward facing view with the product at the centre of everything we communicate

Next Best Engagement, however, places the customer firmly in the centre of the equation and is more inward facing i.e. it asks ‘what is the consumer’s view of our organization its products and services?’ Every potential touch point and interaction should have a ready response built from rich sources of content and delivered through the relevant channel at the best time for the consumer. To achieve this, each consumer journey must be, by nature, more dynamic. Like the very best chess player, we as marketers must have a plan for the next three or four moves which we dynamically change based on the next move from the consumer. To provide true NBE we need to be able to play multiple chess matches concurrently and maintain the individual strategy at the level of each match as no two matches will necessarily be the same.

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