Marketing effectiveness in a changing world – how brands can thrive in 2023

At a recent roundtable discussion hosted by The Drum and TikTok on how brands can thrive in 2023, industry specialists discussed the trends, opportunities and challenges that marketers face. The discussion, moderated by Balendu Shrivastava, head of measurement, APAC at TikTok, also explored how TikTok has become a preferred channel for marketers to generate business outcomes due to its unmatched product discovery, effective brand building and sales uplift.

With the cloud of recession and inflation looming on the horizon, consumers are becoming much more discerning about the choices they make. Sapna Nemani, chief product and solutions officer, APAC at Publicis Groupe, implies that the shopping basket is shrinking, and consumer choices are fundamentally changing. The way consumers view the shopping basket is not necessarily about the lowest price but of value.

“Shoppertainment is at the forefront of the way people are discovering brands but also buying at the same time,” said Nemani. “There is no real funnel as such. TikTok has cracked the art of authentically bringing everything together - content, education, entertainment, and purchase.”

Merging user journeys in a fragmented omnichannel world is a challenge that Vitya Vijayan, head of social and search, APAC at M&C Saatchi Performance, is working towards. “During the pandemic, everyone was on their digital platforms and that's pretty much where you could be, but we're starting to see fragmentation in the digital user journey as consumers go offline. Digital experience alone is not sufficient anymore. So, we need to start thinking about how we can get consumer attention from an omnichannel perspective.”

Brands balance between short-term revenue and long-term growth

With the current economic environment, marketers are under a lot of pressure to prove the value of their investments. They are inclined to aggressively prioritize sales over brand building and shift their marketing budgets from media spend to promotion spend, as consumers are price-sensitive and marketers need to win or protect their share.

“To analyze trends in 2023, we looked at Q2 of 2020 which indicated 71% of brands were cutting their media investments by more than 25%,” says Abhinav Maheshwari, vice president of marketing effectiveness at Nielsen. “While this may have been a short-term fix, the long-term impact of going dark has caused loss of revenue. Going into 2023, we recommend brands move from short-termism and focus on building better value, trust in the brand to achieve long-term impact.”

Pablo Gomez, head of creative and media at Kantar, believes in striking a balance between short- and long-term strategies and continuing to build brand equity. He said: “One of the key insights we saw is that consumers don't like advertising in general, they don't like to be interrupted. But brands like TikTok can find the balance because you're not interrupting consumers but are engaging them.”

For Rajeev Bala, vice president of internet marketing at Tokopedia, promotions are a way to convince consumers to stock up more but are not going to increase the consumption of that product.

“Consumers buy two when they could’ve bought one,” he said. “You may see a bump in sales, but it’s only short-term. The moment brands start giving signals to the consumer that they are all about promotions, then the customer becomes spoilt for choice which is not good for the brand in the long run. Instead, brands should focus on building the brand as opposed to investing in pure performance marketing.”

Measuring marketing effectiveness is key to building your brand

Measuring marketing effectiveness can be challenging as there are various data points and metrics to look at. Measurement experts believe in measuring a few metrics integral to your brand rather than measuring all the available metrics.

A vision for measurement is that everything you measure should lead to an incremental lift in your business, suggests Samiha Alam, head of agency at AppsFlyer. “There is just too much being measured, too much being tracked. And it’s difficult to separate the ‘signal’ from the ‘noise’. So, you end up using a lot of resources on things that would not give the incremental lift in your business.”

Marketers should set clear campaign objectives and KPIs and avoid wishing to tick all the boxes from awareness to conversion within one short campaign. For instance, measuring the app opens is an important metric over conversion rate for Tokopedia.

At M&C Saatchi Performance, clients are recommended to add a branding campaign on top of their performance campaign. “We have been able to show success in organic lifts and reaching new audiences," says Vijayan.

Brands must be flexible in defining success and have a long-term success plan, not seven days or one month, suggests Alam. “Brands need to focus on awareness and no matter where on the funnel you are, you have measurement tools to guide the brand. Brand and performance teams should work together and not sit in silos.”

Based on a Nielsen Report, a 1-point increase in brand metrics such as awareness and consideration drives a 1% increase in sales. And increasing awareness and consideration by 1% can also decrease short-term cost per acquisition by 1%. “Advertisers are asking for measuring twice and then planning once. They want to see what channels are important for brand building and what channels are important for driving sales. So, the entire budget allocation exercise is invested on both brand building and sales channels,” adds Maheshwari.

Among key metrics, the panelists agreed that measuring creative is largely untapped. Marketers need to focus on measuring creative at the most granular level where brands can look at the impact of sponsorship, creators, influencers and new channels like podcasts or branded content.

Edith Wu, head of regional business, SEA at TikTok, emphasizes the importance of measuring value of views. "The user journey on TikTok is largely driven by video views. To not disrupt their viewing experience, users may not click the ad immediately when they see a product they like and decide to purchase later. Hence measuring views on top of clicks give advertisers a holistic understanding of performance."

TikTok solutions help brands thrive across the funnel

TikTok has consistently delivered results for brands across multiple dimensions including return on ad spend, sales efficiency, incremental sales, as well as offline sales.

Today’s consumers want to be a part of the discovery process. “When consumers before the era of TikTok went to search for a product or search for answers, they only searched for what they knew,” adds Alam. “With TikTok, they are getting a perspective of what others know. So, the way consumers are discovering, engaging, and buying from a brand is going to change, and thanks to TikTok for revolutionizing the discovery process.”

“What we saw from the results is that TikTok in Southeast Asia achieves a 63% higher return on ad spend (ROAS) versus other digital channels that were modeled in this exercise, and 5.2 times more sales efficiency versus offline channels,” explains Maheshwari.

“The results were similar if you look at other regions, including the Middle East, Europe, and US, which also saw similar increases.

”In Southeast Asia, we also found that brands that were using multiple TikTok ad formats, for example, using hashtag videos, in feed, hashtag challenge in feed videos as well as branded content. They were able to achieve a 12% higher ROAS compared to brands that were just focusing on one ad format. And we also found that brands that executed more than seven weeks of the campaign saw a 14% higher ROAS than brands that executed a shorter campaign.”

Key takeaways for brands

The APAC industry experts recommend that brands need to move from short-termism and focus on building better value and trust in the brand to achieve long-term impact. Brands can leverage TikTok's solutions to better engage consumers across the funnel and achieve marketing efficiency. When it comes to measurement, brands can’t set and forget, “Brands must measure at a granular level irrespective of short- and long-term objectives. It’s important to learn, prove and move on, and brands need to be as agile as measurement should be,” sums up Shrivastava.

During turbulent times, there is a general shift from branding to lower-funnel performance campaigns due to pressure on marketers to increase revenue. However, marketers should also consider the importance of brand building. Those that do are most likely to succeed.

Watch the video above for highlights from the discussion on best practices on measurement.