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Managing Digital Marketing in 2015

Best practices for integrating digital technology,


marketing and advertising to fuel business growth
Author: Dr Dave Chaffey, SmartInsights.com

Research in collaboration with TFM&A 2015

Published with Expert commentary: February 2015


Contents

Executive summary............................................................................3

Managing Digital Marketing in 2015..................................................3

1. Review Digital Marketing Contribution and Capabilities............9

2. Developing Strategies And Plans For Digital Marketing...........13

3. Managing change with Digital Transformation programmes....19

4. Development of Digital Skills and Managing Change...............22

5. Investing In Digital Marketing In 2015.........................................25

6. Innovation And Optimising Digital Marketing............................30

Appendix...........................................................................................33

Methodology.....................................................................................33

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Executive summary
Managing Digital Marketing in 2015

This research from Smart Insights and TFM&A 2015 explores approaches businesses
use to plan and manage their investments in digital marketing. Findings and recommen-
dations are grouped in 6 areas aimed at improving the commercial contribution of digital
marketing for businesses.

1. Digital marketing capabilities and transformation


The majority of companies are still actively working on transformation of their digital
marketing capabilities – less than 20% rating their digital communications, customer
communications or performance improvement process at an advanced level.

When asked about managing digital transformation, again just 20% of businesses had a
transformation programme in place, but with 33% planning to implement a programme
within the next 12 months.

þþ Good practice: Audit your digital marketing capabilities and create a roadmap for
transformation to improve capabilities over the medium to long-term.

2. Digital marketing strategy and planning


In business, it’s recognised that plans help companies to prioritise, set goals and allocate
resources to meet targets. Yet a planned approach often isn’t followed in digital marketing
or marketing:

ýý One half (50%) of businesses surveyed do not have a defined digital plan or
strategy, although they are active in digital marketing.

ýý Nearly half (45%) also don’t have a defined marketing plan in the business to align
digital strategy against.

þþ Good practice: Don’t just execute! Create a long-term digital strategy and plan
aligning with marketing and business priorities.

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Executive summary

3. Managing change via digital transformation programmes


Integration of digital channels into marketing activities was identified as a major challenge
in the research – only a quarter of companies (24%) were happy with their level of
integration of digital marketing and traditional communications.

ýý The main barriers to integration are:


1. Lack of integrated strategy and plans (27%)
2. Teams structured in silos (23%)
3. Lack of skills in integrated communications (17%)

þþ Good practice: Use digital transformation programmes to eliminate digital


marketing silos and improve integration through integrated planning and
collaboration during campaigns.

4. Development of digital skills


Across respondents to the survey, nearly 60% of peoples’ time is now devoted to digital
marketing activities, showing the importance of skills development in this area.

Many marketers are now confident in their knowledge of digital channels with nearly
half saying they are confident, with in-depth knowledge or sufficient knowledge for what
they need across different digital marketing techniques. However, there is still hunger for
deeper learning about digital marketing approaches, particularly in Big Data and CRM
(58% want to improve their knowledge), digital strategy (53%), search engine marketing
(51%), content marketing (50%) and social media marketing (47%).

þþ Good practice: Review and develop your personal or employees’ digital skills.
Are you a T or W-shaped marketer?

5. Investing in digital marketing in 2015


þþ The research shows the ongoing importance of the core digital marketing channels
with similar levels of effectiveness compared to 2014. Email marketing was rated as
highly or very effective by 51% of respondents followed by SEO (45%) and AdWords
(34%). Organic use of social media wasn’t far behind with 33%, but with only 21%
believing paid social media was effective.

þþ Many marketers are planning to increase investment across these channels with
Email marketing (59%), SEO (51%) and AdWords (46%) leading the pack.

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Executive summary

þþ Good practice: With the diversity of paid, owned and earned media, it’s important
to focus resources and optimisation on core channels that drive value.

6. Innovation and optimising digital marketing


The opportunity to dynamically update and test digital media has always been claimed to
be one of its main benefits compared to traditional media, so we were interested to see
to what extent companies have processes in place to execute this continuously. Around
a quarter to a third of companies have embraced optimisation, with these leaders running
frequent tests or continuously optimising. The percentage of leaders who optimised
individual channels or contact points was 30% for website (desktop experience). 21% for
Mobile (mobile site and/or apps), 29% for landing pages, 35% for email marketing, 29%
for social media marketing, 28% for content marketing and 31% for paid digital media.

þþ Good practice: You can’t compete if you update your website, your
communications approaches every few years... Create a plan for “Always-on”
optimisation of digital media and integrated customer experiences.

Methodology
We surveyed Smart Insights members who are based around the world and previous
attendees of Technology for Marketing & Advertising, a conference based in the UK. The
survey was completed online during November and December 2014.

There were 765 respondents, with the majority (62%) in senior, management roles.
Respondents are typically experienced in marketing, with nearly two thirds having more
than five years experience and over a third having more than 10 years experience.

Further details on the sample frame are available at the end of the report.

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Introduction

The need for managing digital transformation


In a Google Think article, A “Post Digital” World, Really? Y&R Chairman and CEO David
Sable argued against those commentators who said that businesses and consumers are
now in a “Post Digital” world. We concur. You will see from the results of this survey that
the reality for many businesses is that despite widespread adoption of digital technology
by their customers and their most advanced competitors, we are still in an era of
managing transformation to improved digital capabilities. Many businesses are limited in
their capabilities and currently lack plans. However, there is a strong appetite to improve
their approach to digital marketing using digital transformation and increased investment
in digital media and technology.

How well do companies manage digital marketing?


At Smart Insights we believe that successful marketers look beyond chasing every
latest technology innovation, following a more strategic, managed approach based
on optimising communications for key customer touchpoints. So, in this research we
wanted to go beyond reviewing the digital marketing tactics deployed and explore the
strategic approaches businesses take to manage the transformation needed to improve
the commercial contribution of digital marketing integrated with all marketing activities.

About Smart Insights


Smart Insights provides actionable marketing resources to help businesses succeed
online. More than 80,000 Basic members use our blog, sample marketing templates
and weekly Digital Marketing Essentials newsletter to follow best practices and keep
up-to-date with the developments that matter in digital marketing.

Thousands of Expert members from over 80 countries use our planning and management
templates, guides and video courses to map, plan and manage their marketing using the
Smart Insights RACE Planning framework.

Here are 10 reasons why Expert members use our resources.

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Introduction

RECOMMENDED RESOURCES
Strategy development and planning templates

We have developed a series of tools for Expert members to help them plan:
þþ Digital strategy toolkit. This template contains a full workbook to create a
digital marketing strategy to Reach-Act-Convert and Engage your audience.
þþ 7 Steps Digital Strategy guide and course. Step-by-step guidance.
þþ Example digital marketing plans. An example online marketing plan and
blank template using the Smart Insights RACE Planning framework.

About Technology for Marketing & Advertising (TFM&A)


We teamed up with TFM&A to research and present these findings and recommenda-
tions.

TFM&A is the leading event for the marketing industry in the UK. Now in its 15th year,
TFM&A offers the opportunity to learn from a diverse educational programme hosting
the latest industry topics, source solutions from leading marketing tech suppliers, and
network with other marketing professionals.

To share best practices in managing digital marketing, Dr Dave Chaffey of Smart Insights
will be presenting the research and recommendations in seminar sessions at TFM&A
2015, taking place 25-26 February at Olympia London. To register to attend for free,
click here.

For year round marketing and ecommerce insight, research and downloads, please visit
tfmainsights.com.

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Introduction

About the report author


Dr Dave Chaffey is CEO and co-founder of digital marketing
management advice site Smart Insights. He is author of 5
bestselling books on Ecommerce including Digital Marketing:
Strategy, Implementation and Practice and was recognised by the
Chartered Institute of Marketing in 2004 as one of 50 marketing
‘gurus’ worldwide who have helped shape the future of marketing.

Research findings and recommendations


In common with all resources for members in our Smart Insights Digital Marketing Library,
we want this report to be practical and actionable, to make a commercial difference
to your business. So, the results presented from this research are structured around
practical activities companies can use to follow a more strategic, planned approach to
digital marketing.

As always with Smart Insights, each section is based around questions the marketer can
ask to review and so improve his or her approach to managing digital marketing.

We hope you find this research and recommendations useful in reviewing and shaping
your use of digital marketing. If you have any comments or questions, do get in touch.

Dave Chaffey, SmartInsights.com, January 2015

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1 Review digital marketing capabilities
and implement digital transformation

Does your company have the right capabilities in place to


make the most of digital marketing?
Whether companies are able to deliver on the potential of digital channels to contribute
value depends on whether they have the right capabilities in place across the company
for all the digital touchpoints that need to be managed.

We asked companies to rate their digital capabilities from an initial level, 1 through to an
advanced ‘optimized’ level of 5 by referencing the capability assessment shown on the
next page. Results show that the majority of companies rate their capabilities at lower
levels of 1 to 3 on this scale of 1 to 5.

Q11 Assessment of digital marketing capabilities in organisation

Assessment of digital marketing capabilities in organisation

A. Strategic approach 19% 34% 26% 14% 6%

B. Performance Improvement process 23% 35% 27% 11% 5%

C. Management buy-in 1 Lowest


18% 32% 27% 12% 11%

2 Managed
D. Resourcing and structure 18% 35% 29% 10% 7% 3 Defined

4 Quantified
E. Data and infrastructure 19% 33% 32% 11% 5%
5 Optimized

F. Integrated customer communications 25% 34% 25% 12% 4%

G. Integrated customer experience 24% 34% 27% 11% 4%

0% 20% 40% 60% 80% 100%

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5 Importance
1 Investing in of
digital
digital
marketing
marketing

Since digital marketing involves execution of many marketing processes and activities,
it’s useful to rate different types of capabilities by their current effectiveness. This can
help prioritisation of future improvements. The weakest processes that are important
for future improvement can be identified and prioritised. A roadmap can then be used to
improve capabilities and improvements reviewed against this.

AIMING FOR DIGITAL Take your digital marketing to the next level with our
capability assessment. Use our visual checklist to audit

MARKETING EXCELLENCE how well your business or clients are exploiting their digital
marketing and then plan how to take it to the next level.

FIVE. Optimized
FOUR. Quantified
THREE. Defined
Digital
TWO. Managed
Capability ONE. Initial Business-aligned
Agile strategic
approach
Defined vision and strategy and roadmap
Prioritised marketing strategy
A. Strategic activities
No strategy
Approach

B. Performance Quality-based KPIs Value-based KPIs


Volume-based KPIs Lifetime-value KPIs
Improvement No KPIs ‘Last click’ attribution Weighted attribution
No dashboards Continuous CRO
Process Business dashboards Ad hoc CRO

C. Management Verbal support, but Sponsorship and Active championing and Integral part of
Limited
Buy-in inadequate resourcing increased investment approriate investment strategy development

D. Resourcing Centralised hub and


Core skills centralised or Decentralisation and Balanced blend of
and No specific skills spoke
agencies reskilling marketing skills
Structure Dedicated resources

E. Data
Limited / no Separate data, tools Partially integrated Integrated systems Flexible approach to
and
customer database and IT services systems and data and 360o data sources optimize resources
Infrastructure

F. Integrated Integrated, Personalised,


Core push activities Integrated inbound Media optimized for ROI
Customer Not integrated Paid-Owned-Earned
synchronised approach and to maximize CLV
Communications media

G. Integrated Partially personalized Integrated, Personalized web, Full contexual


Desktop and mobile
Customer Website not integrated desktop and mobile mobile, email and social media personalized experiences
support, not personalized
Experience experience communications and recommendations

“Developing “Competent average “Above-sector average “Market leading


“Laggard” capability” capability” capability” capability”

Refine your Digital Marketing Strategy Check out our hub page http://bit.ly/smartstrategy for Join our Expert members to download digital marketing planning
with Smart Insights member toolkits. our free blog articles and planning template. templates and our 7 Step guides to digital strategy.

To download a larger version of the capability matrix go to http://bit.ly/smarttransformation

!
KEY STRATEGY RECOMMENDATION 1: BENCHMARK CAPABILITIES
Score your digital capabilities to benchmark and then analyse how you can
improve and to win the case for investment

Assess what your current capabilities are overall and for key digital channels
to communicate to colleagues where you need to improve. The assessment of
capabilities was based on the survey respondents reviewing a capability review
which can be viewed on the Smart Insights Digital Transformation page.

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5 Importance
1 Investing in of
digital
digital
marketing
marketing

EXPERT VIEW – AUDITING DIGITAL CAPABILITIES


Daniel Rowles, Digital Marketing Consultant and Trainer, Target Internet

I think the best practice of auditing digital capability is of huge significance


and this is inline with other findings around a lack of strategy and internal skills.
Organisations are just waking up to the need to step back and look at their digital
capability and assess what it is that is holding them back, and what they need
to change in order to make effective digital possible. The emergence of Digital
Transformation as a key issue that organisations are thinking about is great news.
Understanding the gap between where we are now and where we need to be is
essential.
Its surprising how many organisations are still dealing with the basics, but I
think this reflects back to need for digital capability auditing and the need for
organisational transformation. Without the fundamental building blocks in place
that will give the right environment for digital, no progress can be made. Many
marketers are spending their time battling with IT infrastructure issues or getting
management buy in, and this prevents the advancement of their digital marketing.

Adoption of digital transformation programmes

Organisations who recognise the importance of digital media and technologies in the
future and seek to accelerate the rate of change to integrating digital marketing into their
business create digital transformation programmes.

To find out the commitment to digital transformation we asked a new question in this
years survey asking about use of Digital Transformation programmes.

The results, shown on the next page, show that over one quarter (30%) of businesses
already have a transformation programme in place, with many businesses still looking to
launch their digital transformation programme.

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5 Importance
1 Investing in of
digital
digital
marketing
marketing
Assessment of digital marketing capabilities in organisation

Adoption of digital transformation programmes in business

11% We have had a digital transformation process


in place for more than 2 years
37% We have just started a digital transformation
19% programme (within the last 2 years)
We are planning to introduce a programme
within the next 12 months
We have no plans to run a digital
transformation programme
33%

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A significant proportion of organisations have no intention to implement a programme


because they feel it is inappropriate for their type of business, for example, startups and
smaller businesses or businesses who are online pureplays.

RECOMMENDED RESOURCES
Smart Insights Benchmarking Tools
We have developed a series of strategic tools to help companies review their
digital marketing and make the case for more investment in digital marketing:
þþ Digital marketing audit / benchmark
A detailed spreadsheet based technique for assessing a company in 6 key
areas. Best suited to larger organisations.
Ecommerce option (PRICE framework) available from Chris Jones.
þþ Competitor benchmarking tools
A recommended process and tools for comparing performance.
þþ Business case template
Improvement needed can be justified through this template and the companion Ebook.

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2 Developing Strategies And Plans
For Digital Marketing

Is digital marketing based on a planned approach?


We believe that to gain the most from digital platforms, a structured, planned approach
based on a solid strategy will give the best results. Plans help businesses to prioritise,
set goals and resource at the right level to hit targets. That’s well known for business and
marketing plans. We wondered whether businesses take a planned approach to digital
marketing too. Without structured plans, there is a danger you will be subject to “shiny
object syndrome”, always chasing your tail, as Jeff Bezos of Amazon has referred to.

Q9 Does your
We found that a majority organisation
of organisations have to
responding a clearly defined
the survey do use a planned
digital marketing
approach to digital marketing, but many still don’t.
strategy?

Does your organisation have a clearly defined


digital marketing strategy?

Yes - it's integrated into our


34% marketing strategy
Yes - it's defined in a separate
50% document
No - we are doing digital
marketing, but no defined strategy

16%

www.smartinsights.com www.tfma.co.uk

!
KEY STRATEGY RECOMMENDATION 3: CREATE A DIGITAL PLAN
Create a specific digital marketing plan aligned with marketing strategy

To provide focus and direction for the future, create a detailed digital marketing
plan defining the digital channel strategy for each major market / proposition.

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2 Developing strategies

Shockingly, nearly half of businesses do not have a digital strategy, but they are doing
digital marketing.

EXPERT VIEW – OVERCOMING INTERNAL ROADBLOCKS


Kieran Flanagan, Marketing Director, EMEA, HubSpot


The biggest road block for most businesses is usually themselves. To be more
accurate, that person in the company who owns the budget/resources and doesn’t
understand digital. There are too many CMOs, CEOs or other variations of senior
management who still don’t fully understand digital. They usually have a team
beneath them trying to push digital forward, but they won’t hand over the keys to
let them make the necessary changes.
One way this can be bridged is with continued education. Education around
digital marketing has never been better. There are so many places marketers can
go to upskill themselves on digital.
They other way is of course with results. Marketers who want to push digital forward
within their company need to demonstrate positive results before they’ll get the
necessary budget/resources need to make this happen. What I tell marketers in
this position is to initially look for quick wins. What is the quickest way you can
demonstrate success to your manager/CMO/CEO. How do you provide them with
that moment where they start to see the value in what you are proposing.

Equally, it’s important to avoid creating a silo of digital resources and practice through
digital transformation. So we see a digital plan as a short-term tool to define your digital
future and help transform your business until it becomes an integrated part of planning
for business as usual.

RECOMMENDED RESOURCES
Strategy development and planning templates

We have developed a series of tools to help Expert members plan:


þþ Digital strategy toolkit. This template contains a full workbook to create a
digital marketing strategy to Reach-Act-Convert and Engage your audience over
the next year or in a 90 day planning period.
þþ Example digital marketing plans. An example online marketing plan and
blank template using the Smart Insights RACE Planning framework.

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2 Developing strategies

BEST PRACTICE TIP 1


Ensure your plan and deployment of digital resources is integrated

Although you may initially need a separate digital plan to help you create a strategy
and get buy-in for investment in digital channels, it’s important to keep it well
integrated. That means supporting common business goals and consistent with
brand and communication strategy. The long-term aim should be to integrate your
digital plan into your marketing communications plan.

Integration requires a clear marketing or business strategy and plan also. The survey
results suggests that lackorganisation
of a marketing plan in a substantial proportion of organisations
Q8 Does your
may make it difficult to e.g.
alignana digital
have a clearly defined marketing
strategy, annualplan against!plan, against which you can
marketing
align your investments in digital technology and media?

Does your organisation have a clearly defined marketing


strategy, e.g. an annual marketing plan, against which you can
align your investments in digital technology and media?

44.81% Yes

55.19% No

This shows the necessity for digital marketing managers to work with their colleagues to
agree how digital marketing can support and integrate with marketing.

As we would expect, leading companies who rate their digital capability at level 4 or 5 for
strategic approach as shown in the first chart in this report are more likely to base this
on a defined strategy. 90 percent of leading companies have a digital marketing strategy

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2 Developing strategies

(integrated in 70 percent of companies, defined in a separate document in 20 percent of


companies). Of other companies, 75% of ‘digital laggards’ don’t have a digital marketing
strategy.

What should the planning horizon for digital planning be?


Traditionally, business and marketing planning in many larger businesses has been
long-term. Long-term planning enables consistent strategies to be followed in line with
forecast changes in the marketplace and resources allocated. We recommend that,
although digital media change rapidly, the long-term transformation needed by digital
means that you won’t
How be able
far ahead dotoyou
transform theconsidering
plan when organisation in digital
how 3, 6 ortechnologies
even 12 months.
In our previous 2014 research we
willfound that many
contribute businesses
to your do not have a long-term
marketing?
planning horizon with less than one fifth looking beyond the current year.

How far ahead do you plan when considering how digital


technologies will contribute to your marketing?
0% 10% 20% 30% 40%

>3 year and strategic initiatives defined 2%

2-3 year vision and strategic initiatives defined 46%

Annual plans maximum 32%

Campaign and quarterly plans maximum 37%

mainly day-today, week-to-week operations 20%

BEST PRACTICE TIP 2


Create a hierarchy of plans for different timescales and activities

To help develop a more coherent approach to marketing planning, we suggest


you develop a hierarchy of plans as shown in the diagram below. Annual business
and marketing objectives can cascade into goals, objectives and KPIs for different

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2 Developing strategies

EXPERT VIEW – DELIVERING RELEVANCE


Jim Sterne, Founder, eMetrics Summit & Digital Analytics Association

The most important factor for digital strategy in 2015 is flexibility. Your target
audience is changing all the time. Younger people are come into your market
and the rest are getting inexorably older. Everybody uses different technologies
for content consumption than they did just last year. Trends, memes, themes,
and cultural norms shift constantly. You have to keep up to keep your message
relevant.
The only way to do that successfully is to keep your finger on the pulse of your
customers’ behavior and opinion. Track what they do and ask them how they
feel... all the time. Bringing these two data streams together is your only hope for
delivering the right messages to the right people at the right time, segment by
segment.
Managing these two data streams in tandem is the significant challenge. Focusing
too much on one or the other, in terms of budget, tools or report weighting, can
blur the results and tarnish your decision making.
Yes, that means you need two teams, the quantitative group and the qualitative
group, and the wisdom to merge the fruits of their intellectual labors.

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2 Developing strategies

How should digital marketing and traditional marketing be


integrated?
There is a risk that separate digital marketing plans and teams lead to silos for digital
marketing, so it’s important to think about how you manage integration.

The research shows marketers are making solid progress towards integration, although
relatively few describe their approach as fully integrated.

“Only a quarter of companies (24%) were happy with their level of integration of digital
marketing and traditional communications”.
Q12 How well integrated are your digital and traditional marketing activities?

How well integrated are your digital and


traditional marketing activities?

Optimising. Full integration and processes are


7%
reviewed for optimisation.

Fully-integrated. Digital marketing is integrated


within the wider marketing plan but we're not 17%
optimising.

Actively trying to integrate the two. We are making


solid progress in integrating digital and traditional 40%
marketing.

Limited integration. We use digital marketing, but it


24%
isn't well integrated into overall strategy.

Not integrated. Our use of digital marketing is ad


12%
hoc and not integrated.

0% 10% 20% 30% 40%

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2 Developing strategies

The research showed that the lack of a planned approach is most damaging to
integration. Creation of separate teams for digital marketing and traditional marketing
Q12 Which
also single
presents problemsfactor most limits
for integration, integration
showing the importance ofof digitalprocesses
developing marketing channe
and developing skills that involve collaboration across silos.

Which single factor most limits integration of


digital marketing channels?

Lack of integrated
27%
strategy and plans
Lack of process for making
13%
the business case
Teams structured
23%
in silos
Lack of skills in integrated
17%
brand communications
Uncertainty in our commitment
8%
to digital channels

Other 12%

0% 10% 20% 30%

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BEST PRACTICE TIP 3


Allocate and ringfence time for collaboration

The ‘other’ choice was high when asked about integration, with many citing time,
budget and resource. This suggests there was poor realisation that time needs to
be allocated by management for collaboration.

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3 Managing change through digital
transformation programmes

How many digital marketing specialists do companies


employ?
Although it’s often said that digital marketing will become part of “modern marketing”, the
reality in companies is that specialist resources and agencies are required to manage
specific digital marketing techniques. To find the importance of this we asked how many
specialist digital marketing roles are used in companies. Across companies there were
an average of:

þþ 11.5 staff in the marketing organisation


þþ 3.3 staff who were digital marketing specialists
So, that’s an average of between one quarter and one third of marketing roles (28.3%)
held by digital marketing specialists in organisations.

Which resources are used for digital marketing?


With the growing importance of digital marketing in driving leads and sales, a key
resourcing question is which digital marketing activities should be managed internally
and which can be outsourced. There is an argument that some digital marketing activities
should be managed internally since they are so vital to the brand or since the “devil is in
the detail”. For example, digital marketing activities such as search, content, email and
social media marketing typically required a deep understanding of the customer and
micro-management of communications to gain the best results for a brand.

Results from our research in 2014 suggests that in companies of the types surveyed,
managing digital marketing activities in-house is widely used, particularly for social
media, email marketing and SEO.

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3 Resourcing digital marketing

Popularity of resourcing options for digital marketing

Blogging 53% 16% 6 25%

Content marketing asset creation 54% 20% 10 17%

Email marketing 70% 15% 5 10%

Online PR 40% 19% 14% 27%

Display advertising 30% 16% 20% 34%

Social Media Marketing


37% 13% 12% 38%
(paid media)
Social Media Marketing
(earned incl content marketing) 71% 13% 7 9%

Paid Search Marketing


(Google AdWords) 35% 14% 23% 29%

SEO (Search Engine


46% 18% 21% 15%
Optimisation)
0% 25% 50% 75% 100%

Mainly in-house Mixture Mainly We don't invest in


outsourced this activity or N/A

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This chart also shows that significant numbers are failing to exploit the full range of tools
available. This is particularly true for the paid media options.

BEST PRACTICE TIP 4


Review opportunities for using paid media to meet online goals

Options such as Google AdWords and paid ads in social networks give
opportunities to create incremental awareness and increase conversion through
the use of remarketing.

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3 Resourcing digital marketing

Are we resourcing sufficiently in different digital marketing


activities?
With the range of digital channels available, there is also the challenge of investing the
optimal amount in different digital marketing activities. This is not straightforward given
the challenges of:

ýý Attributing sales to the right channels / customer touchpoints using analytics

ýý Fragmented decision-making on digital marketing investment

ýý The pace with which new digital marketing channels are introduced
Results show a common perception amongst people working in marketing that
insufficient time is spent on planning, measurement and optimisation (respondents could
choose multiple answers). This is potentially a management failing since managers are
responsible for ringfencing
Q15 time foryou
How do these activities.
rate your company's relative investment in these
digital marketing activities (choose all that apply)

How do you rate your company’s relative investment in these


digital marketing activities (choose all that apply)
0% 10% 20% 30% 40% 50%

Insufficient time invested in measurement,


53%
testing and optimisation for maximising ROI.

Insufficient time spent 46%


on planning.

Insufficient investment in paid media within organisation?


43%
(e.g. Display ads, paid search, sponsorships).

Insufficient investment in earned media within organisation?


40%
(e.g. PR, Influencer outreach, building brand advocates).

Insufficient investment in owned media within organisation?


(e.g. desktop and mobile site and apps, Facebook, 40%
LinkedIn, Twitter, etc).

Insufficient joined up thinking 38%


leading to poor integration.

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3 Resourcing digital marketing

Although best practice advice usually recommends a planned approach to digital


marketing using the dynamic benefits of digital technology to optimise campaigns and
creative, many felt that organisations weren’t devoting enough time to this. Around 40%
believed that insufficient time was spent on planning and optimisation to improve ROI.

RECOMMENDED RESOURCES
Structuring digital teams and job descriptions

We have developed a series of templates to help define the best ways to manage
digital marketing. These are:

þþ Digital marketing team structure toolkit


þþ Digital marketing job descriptions and roles template
þþ Business case template

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3 Resourcing digital marketing

4 Development of Digital Skills

Q2 Assessment of personal knowledge of digital marketing

Development of skills and talent within marketing employees will help companies
compete through a better quality of digital marketing. Given this, we wanted to explore
Social media
the personal challenges for marketers of keeping up-to-date and the skills requirements.
marketing
27% 25% 47% 2%

Search Engine Marketing


20% 25% 51% 3%
(SEO and PPC) I'm confident and have
in-depth knowledge

Across respondents to the survey nearly 60% of peoples’ time is now devoted to digital
PR
16% 32% 39% 13% I know the basics and
that's all I need

marketing activities, showing the importance of skills development in this area.


Digital
strategy
32% 15% 53% 0%
I need to improve my
depth of knowledge

Not relevant to me
Design (web, mobile,
PPC)
19% 33% 42% 6%
multichannel)

We asked about specific personal needs for skills development. Many marketers are now
CRM and
Big Data
PR
13% 22% 58% 8%

confident in their knowledge of digital channels with nearly half (46%) saying they are
Content
26% 22% 50% 2%
www.smartinsights.com www.t-f-m.co.uk

marketing

confident, with in-depth knowledge or sufficient knowledge for what they need across 0% 20% 40% 60% 80% 100%

different digital marketing techniques. However, there is still hunger for new learning,
particularly in Big Data and CRM (62% wantQ2to Assessment of personal
improve their knowledge ofcontent
knowledge), digital marketing

marketing (55%), digital strategy (52%) and social media marketing (48%).

Assessment of personal knowledge of digital marketing


Social media
27% 25% 47% 2%
marketing

Search Engine Marketing


20% 25% 51% 3%
(SEO and PPC) I'm confident and have
in-depth knowledge
PR I know the basics and
16% 32% 39% 13%
that's all I need

Digital I need to improve my


32% 15% 53% 0% depth of knowledge
strategy

Not relevant to me
Design (web, mobile,
PPC)
19% 33% 42% 6%
multichannel)

CRM and
PR
13% 22% 58% 8%
Big Data
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Content
marketing 26% 22% 50% 2%

0% 20% 40% 60% 80% 100%


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4 Skill development

EXPERT VIEW – CRM AND BIG DATA SKILLS


Nick Baggott, Trainer and Consultant, Director, Navigate Consulting

“The survey shows that the digital skills that most marketers feel they need to
improve most revolve around CRM and Big Data. I am not surprised by this.
The most engaging digital channels are personalised around the needs and
behaviours of individual users. Marketers will have experienced this on sites like
Amazon and Netflix and are wondering how they could achieve the same degree
of personalisation and relevance with their own digital content. They will also
be aware that display ads, search and social media are also becoming more
personalised.
So marketers need to up their game in terms of CRM, because it will help them to
develop more engaging and personalised content in their owned channels, but
also so that they can understand how to be more effective in using the paid and
earned media channels like Google and Facebook.
Marketing is becoming more of a science than an art. Analytics skills are crucial
to your ability to target and develop engaging content. Sophisticated testing
and measurement are crucial if you want to justify marketing budgets and really
understand what is working. The technology costs are reducing, the software is
becoming easier to use, so CRM is now affordable, achievable and has never
been more crucial to marketing success.”

Given the range of potential techniques to master there has been much talk within digital
marketing of the necessity for marketers to broaden their skill-sets and to embrace and
learn broadly, while focusing on key areas – to become a T-Shaped Marketer.

The T-Shaped Marketer is a marketer that has broad knowledge covering a wide range
of digital tactics with in-depth knowledge in 1 or 2 specific areas as shown by the chart
on the next page*.

EXPERT VIEW – CUSTOMER UNDERSTANDING IS CRUCIAL


Geraint Holliman – Director of Strategy and Head of Content Marketing at
DIRECTIONGROUP
The most important skills for any marketer are around customer understanding.
Too often I find that marketers simply do not understand how their customers
actually buy their product and the role that digital channels play in that process.
If you don’t understand how your customer, thinks, feels and behaves then you
have very little chance of delivering engaging and compelling communication,
whether digital or not.

*  Smart Insights: Are you a T-Shaped Marketer?

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4 Skill development

This representation of the T-Shaped marketer shows content marketing at the heart of
the skill set. When we discussed this on our blog, some suggested that a “W-Shaped”
marketer is closer to the mark with several core competencies required, for example an
analytical approach should be a common feature in addition to SEO, Content or UX, for
example.

EXPERT VIEW – THE MOST IMPORTANT DIGITAL SKILLS?


Philip Sheldrake, Author, the Business of Influence

When considering the most important skills of the digital marketer?, it’s a tension
between getting the most for the organisation and for the individual. Ideally, this
tension will be the focus of ongoing alignment, and the skills acquired will then
best serve the individual’s career progression and the marketing strategy the
organisation is executing.
So the answer is, depends. One thing is certain however, the best marketers
invest hours every week without fail in their continuous professional development.

RECOMMENDED RESOURCES
TFM&A Insights Content Skills Assessment Tool

Luke Bilton, Director of Digital and Content for UBM Live has developed this free
tool to score content marketing competence available from TFM&A Insights.

þþ Download Content Marketing Skills Assessment Tool

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5 Investing In Digital Marketing
In 201
2015

Which are the most effective digital marketing channels to


invest in?
To choose the right level of investment in digital marketing requires an assessment of
which channels will produce significant volumes of leads and sales at an acceptable cost
Q16b
per acquisitionHighest-rated
(CPA) for new customers.
digital Reviewingforyour
media channels 2015marketing
(lead andchannels through
sale volume)
comparing these two factors shows which channels warrant most investment.

The most effective channels as rated by our respondents for their expected performance
in 2015 are shown in the chart below.

Top Online Marketing Channels in 2015

0% 20% 40% 60%


Search Engine
Optimisation (SEO) 45%

Paid Search Marketing


34%
(AdWords)

Social media
33%
(organic)

Display
19%
advertising

Online PR 23%

Email
51%
marketing
Social media
(paid ads) 21%

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5 Investing in digital marketing

EXPERT VIEW – MEASURING CHANNEL SUCCESS


Kieran Flanagan, Marketing Director, EMEA, HubSpot

The question for me is how are marketers measuring the success of these
channels. Often marketers will try measure all channels by the same metrics. They
look at leads or sales generated by each channel and then rank them in order of
conversions they generate. Measuring in this way will mean channels like social
will always be below Adwords and SEO, and will probably not look that attractive.
Measuring against the right metrics is such an important part of making good
decisions on what channels to invest time and energy in. Paid social media could
look bad when measured against direct leads and sales attributed to it, but may
look great when you look at multi-attribution reports for those same metrics.

The assessments by marketers of channel effectiveness are consistent with the patterns
reported for driving visits across websites reported by SimilarWeb - use this tool for
comparing to competitors. Search and direct visits are the main traffic drivers, with Social
media marketing and display also low. Email is included within the referrals category in
this example - so this can’t be compared to the reported data from marketers in our study.

Within the retail sector, the volume of search is even higher - the example data below
shows sources of visits for US retail site visitors.

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5 Investing in digital marketing

Q18 Channel cost effectiveness in 2015


Here is the full reporting of media effectiveness from rating each on a 5 point scale.

Channel cost effectiveness in 2015


Social media
16% 21% 18% 16% 8% 21%
(paid ads)

Email
4% 13% 22% 30% 26% 6%
marketing

Online PR 13% 19% 28% 19% 9% 12%

Display
17% 25% 23% 13% 5% 18%
advertising

Social media
11% 22% 26% 22% 15% 4%
(organic)

Paid Search Marketing


12% 19% 23% 21% 10% 15%
(AdWords)

Search Engine
7% 14% 23% 28% 22% 6%
Optimisation (SEO)

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

1 Lowest 2 Low-medium 3 Medium 4 Medium-high 5 Highest 5 Don’t use or N/A

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5 Investing in digital marketing

Q16a Channel rating for volume of leads or sales expected by businesses

Channel rating for volume of leads or


sales expected by businesses
0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

Search Engine
Optimisation (SEO) 10% 15% 25% 27% 18% 5%

Paid Search Marketing


17% 18% 18% 22% 12% 13%
(AdWords)

Social media
16% 23% 24% 21% 12% 4%
(organic)

Display
21% 26% 18% 15% 4% 16%
advertising

Online PR 16% 23% 28% 16% 7% 9%

Email
marketing 8% 13% 24% 28% 24% 4%

Social media
20% 20% 21% 13% 8% 18%
(paid ads)

1 Lowest 2 Low-medium 3 Medium 4 Medium-high 5 Highest 5 Don’t use or N/A

www.smartinsights.com www.tfma.co.uk

BEST PRACTICE TIP 5


Review channel volume against ROI to select the best mix

You can plot volume of leads and sales for different digital media on the horizontal
axis against cost-effectiveness on a vertical axis. You should review specific ad
network placements such as AdWords remarketing or paid social media marketing
techniques. See our Content Distribution Matrix infographic for an example.

The research shows the ongoing importance of the core digital marketing channels with
Email marketing rated highly or very effective by 52% of respondents followed by SEO
(45%) and Adwords (34%). Organic use of social media wasn’t far behind with 33%, but
with only 21% believing paid social media was effective.

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5 Investing in digital marketing

Q20 Investment changes in Digital Advertising in 2015

Investment changes in Digital Advertising in 2015


0% 20% 40%

7%
Facebook 25%
advertising 39%
29%
6%
Twitter 26%
advertising 30%
37%
5%
LinkedIn 25%
advertising 38%
33% Increase
5% Stay the same
Google AdWords Display 24% Decrease
Network including Remarketing 51% Don't use or N/A
20%
4%
Mobile display 26%
advertising 35%
35%
4%
Other Ad 34%
Networks 25%
36%

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We also asked how allocation of investment in digital channels would vary in 2015 which
is an alternative view on the most effective techniques. Many marketers are planning to
increase investment
Q19 across these
Investment channels
changes with
in digital Email
media marketing (59%), SEO (51%) and
in 2015
AdWords (46%) leading the pack.

Investment changes in digital media in 2015


0% 20% 40% 60%
3%
Search Engine 39%
Optimisation (SEO) 51%
7%
6%
Paid Search 33%
Marketing (AdWords) 46%
14%
3%
Social 38%
media (organic) 53%
6% Increase
9% Stay the same
Display 40% Decrease
advertising 33% Don't use or N/A
18%
5%
Online PR 41%
41%
13%
3%
Email 33%
marketing 59%
6%
4%
Social media 32%
(paid ads) 43% www.smartinsights.com www.tfma.co.uk
20%

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5 Investing in digital marketing

Finally, we also reviewed the breakdown of intended Paid and Earned media investment.

Paid media
There are a substantial proportion of businesses that don’t use each of the paid media
options shown in the next chart. However, a large proportion of businesses are looking
to increase investment in paid media, particularly for advertising in social media, a
significant trend for 2015.

Use of data for targeting


We also looked at innovation in using data for targeting. Learning about data, CRM and
Marketing Automation was seen as a great interest in 2015. The results show that, overall
Q14 businesses are long way from the 360 degree customer view and personalised customer
Data-driven marketing
lifecycle marketing - how
that many havewell are you
discussed for aable
long to target your audience?
time.

Data-driven marketing -
how well are you able to target your audience?

Social media interactions or sentiment 30%

Channel preference 29%

Customer value (future e.g. predictive modelling) 19%

Customer value (current) 44%

Behavioural segment (e.g. preference or intent based


48%
on Recency, Frequency or Monetary value of

Disclosed profile (e.g. age or gender) 46%

0% 10% 20% 30% 40% 50%

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5 Investing in digital marketing


EXPERT VIEW – ENCOURAGING MEASUREMENT OF EFFECTIVENESS
Philip Sheldrake, Author, the Business of Influence
It’s striking that marketers can respond to survey questions about effectiveness
and admit simultaneously a paucity in measurement capability.
If they measure at all, the majority of marketing teams measure outputs in my
experience, not outcomes. It’s far easier to measure outputs, but easy and useful
aren’t the same thing. If you measure simply what you can rather than what you
should, subsequent conclusions will be entirely a function of output measurability
than anything resembling strategic effectiveness.
How to encourage measurement of effectiveness? We must appeal to emotions
and character in order to have logic prevail. Every line manager understands the
emotional pressures of reporting to a higher up, and having answers is part and
parcel of good relations with the boss. Talk about the emotional power that comes
from confidence in good measurement and evaluation.
On the character front, distinguish between management (doing things right) and
leadership (doing the right things). Many managers aspire to lead, and that starts
with knowing the right things to do. Investing in understanding what works and

EXPERT VIEW – A SOCIAL MEDIA BACKLASH?


International Social Media Speaker, Writer and Advisor, Debsylee.com

From my own experience many are still struggling to get to grips with how to use
social media effectively. The analogy I tend to use is that it’s like passing your
driving test; knowing the theory and ‘how to’ is just the start. Once you get behind
the wheel of a car then you start to understand that a large part of it is about
preempting and anticipating the actions of other road users (or your social media
audience, if you will). Email marketing, SEO and Adwords are areas that many
have become proficient at, but the truth is that social media is lagging behind in
terms of popularity because we’re still trying to use old and laboured techniques
that just don’t work on the various platforms. They don’t inspire audiences, and so
they are largely ignored.
The implications are that some businesses will undoubtedly abandon the platforms
and others will continue to utilise them by actively progressing their involvement,
with some making real headway. At that point, expect to see a resurgence in
interest and curiosity!
I’d only advise businesses to walk away from social media when user numbers
start to tail off, and there is no sign of that happening any time soon.

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5 Investing in digital marketing


EXPERT VIEW – A SOCIAL MEDIA BACKLASH?
Michelle Carville, Social Media Consultant, Trainer and author
I wouldn’t say there’s a backlash – but social is much more about broadening the
touch points a consumer has with a brand or business, rather than direct sales.
With Adwords and in many cases, SEO, there is a very clear view on exactly how
much £1 spent on Google Adwords or SEO effort returns to the bottom line.
Social is rather more complex to pin down – and therefore, that is probably driving
the believe that it’s far less effective. What’s interesting is content marketing and
social are far more about growing a relationship with a brand or business – and
therefore, the quality of the consumer when they do come on board has been
proven to be far higher than a simple direct response consumer coming via
adwords.
It’s still early days on looking at the impact of strengthening relationships and
loyalty prior to direct consumer purchase – and so I think as marketers we’ll be

EXPERT VIEW – A SOCIAL MEDIA BACKLASH?


Gerraint Holliman, Director of Strategy and Head of Content Marketing at
DIRECTIONGROUP
‘Most marketers see social media as a communications medium in the same way
as they would see advertising or direct marketing: one-way, interruptive, broadcast
messaging.
Until marketers wake up to the fact that the beauty of social media is that digital
channels enable customers to speak back to you then it will continue its downward
spiral into redundancy.’

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5 Investing in digital marketing

Earned media
Within earned media we reviewed a range of content marketing techniques in our 2014
report (omitted in 2015 for brevity). Across these content formats the majority of marketers
said they would increase investment in these tactics.

How will investment in these earned media approaches change (2014)?

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6 Innovation And Optimising
Digital Marketing

Are marketers managing digital marketing activities


continuously?
The opportunity to dynamically update and test digital media has always been claimed
to be one of its main benefits compared to traditional media, so we were interested to
see to what extent companies have processes in place to manage this continuously.
The concept of Always-on marketing has emerged to show a change in emphasis
from burst marketing campaigns to generate awareness and response to investment in
marketing activities which continuously drive and meet changing demand for products
and services as consumers search and review products and services, what Google has
called the Zero Moment of Truth (ZMOT).

For Always-on marketing to be effective, efforts should be made to increase the


effectiveness of different digital channels through testing, review and optimisation. We
explored the use of digital marketing optimisation through a question which reviews the
use of testing across channels. The response to this question shows a core group of
respondents have moved beyond intermittent to more regular structured testing and
optimisation programmes.

A relatively small proportion (around a quarter to a third of companies) have embraced


optimisation with these leaders running frequent tests or continuously optimising. The
percentage of leaders who optimised individual channels using continuous optimisation
or structured tests were. There was no significant increase from 2014.

þþ Website (Desktop experience) 30%


þþ Mobile (Mobile site and/or apps) 21%
þþ Landing pages 29%
þþ Email marketing 35%
þþ Social media marketing 29%
þþ Content marketing 28%
þþ Paid digital media 30%
The next page shows a full breakdown of planned structured optimisation tests for 2015.

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Q17 Always-on marketing and Digital Agility -
use of structured optimisation tests to improve results
6 Innovation and optimisation

Always-on marketing and Digital Agility -


use of structured optimisation tests to improve results

Paid digital
21% 21% 17% 12% 11% 18%
media

Content
marketing 18% 24% 25% 16% 12% 6%

Social media
marketing 16% 28% 22% 17% 12% 6%

Email
marketing 11% 21% 27% 22% 13% 6%

Landing
17% 26% 23% 16% 13% 6%
pages

Mobile (Mobile site


22% 25% 19% 11% 10% 12%
and/or apps)

Website (Desktop
13% 24% 28% 13% 17% 4%
experience)

0% 10% 20% 30% 40% 50% 60% 70% 80% 90% 100%

1 No Optimisation 3 Intermittent optimisation projects 5 Continuous optimisation


2 Some limited 4 Frequent tests 5 Don’t use or N/A

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EXPERT VIEW – TOWARDS AGILE MARKETING
Joe Edwards, Consultant, Brand Joe

The term lean / agile marketing seem to be appearing more and more, which
“Measurement, testing and optimisation” underpin these. I would argue that
perhaps it’s not actually about more investment at all, it’s about re-aligning existing
budgets and re-setting objectives.
In a lean world it’s about minimum viable product, if we start thinking like that in
marketing we’d not need more budget for testing, it would just be built-in, we’d
reap the rewards of our marketing efforts, enough to build the next program,
where more investment would be a natural by-product of the previous activity,
perhaps a holy grail ... but if it’s more budget we need then, it’s business case we
need to provide, what are your expected outcomes from further investment, can
you project or build KPIs around what additional conversions you would hope to
achieve.

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6 Innovation And Optimising Digital Marketing

EXPERT VIEW – TOWARDS AGILE MARKETING


Joe Edwards, Consultant, Brand Joe
In a lean world, it’s about minimum viable product, if we start thinking like that in
marketing we’d not need more budget for testing, it would just be built-in, we’d
reap the rewards of our marketing efforts enough to build the next program, where
more investment would be a natural by-product of the previous activity. Perhaps
a holy grail ... but if it’s more budget we need then, it’s business case we need
to provide. What are your expected outcomes from further investment, can you
project or build KPIs around what additional conversions you would hope to
achieve?

It seems that many marketers are frustrated by the barriers to innovation in digital
marketing. How could this be changed? We wondered which factors are limiting
innovation. The main factors limiting innovation are shown below (Surveyed in 2014).

It is expected that budget limitations may restrict innovation, but lack of process to
encourage innovation and trial can be addressed.

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2 Developing strategies

BEST PRACTICE TIP 6


Identify flexible processes that encourage trial and innovation

Finding methods to encourage trial and innovation of new digital media


technologies and media should be explored by managers given the rate at which
digital media change. This gives both opportunities through gaining cut-through
via new media and content formats and counters the threats through changes to
algorithms affecting visibility in search and social media marketing..

RECOMMENDED RESOURCES
Strategy development and planning templates

We have developed a series of tools for Expert members to help them plan:
þþ Digital strategy toolkit. This template contains a full workbook to create a
digital marketing strategy to Reach-Act-Convert and Engage your audience.
þþ 7 Steps Digital Strategy guide and course. Step-by-step guidance.
þþ Example digital marketing plans. An example online marketing plan and
blank template using the Smart Insights RACE Planning framework.

We hope you have found this report useful to compare against your approaches to digital
marketing and inform your investments.

Do let us know if you have any comments via @SmartInsights or our Contact Us.

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Appendix
Methodology

The survey was completed online during November and December 2014. In this section
we summarise the characteristics of respondents to the survey.

Respondent profiles

We surveyed Smart Insights Expert members who are based around the world and
previous attendees of Technology for Marketing and Advertising, which is a conference
based in the UK, so the emphasis is on UK attendees.

Since this research explores how digital marketing is managed, our research focuses
on the views of marketing managers, digital marketing managers and company owners.

Which of these best describes your role? (Mandatory)


ANSWERS SKIPS

765
100%
00%

0% 5% 10% 15% 20% COUNT PERCENT

Managing Director 148 19%

Owner / Proprietor 112 15%

Digital Marketing Manager 104 15%

Head of Department 84 11%

Digital Marketing 62 8%

Other option 56 7%

Marketing Executive 50 7%

Consultant 49 6%

Board Director / CEO 44 6%

Student 21 3%

Ecomerce Manager 20 3%

Non Board Director 15 2%

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7 Appendix

Our respondents are typically experienced in marketing, with nearly two thirds having
more than five years experience and over a third having more than 10 years experience.

Types of business
Businesses respondents represented a wide range of sectors and sizes including Retail,
Financial services, Consumer brands, travel and public sector/education.

Size of company was assessed based on the resources devoted to marketing in terms
of spend on marketing services and media. Spend on marketing services was skewed
towards smaller businesses, but with 52% of respondents planning to invest more than
£50,000 on external marketing services and media in 2015.

We also wanted to assess the relative importance of digital marketing in terms of dedicated
resources for digital marketing. To do this we asked how many people worked in the
marketing team overall and how many were focused primarily on digital. We explore this
further in the section on resourcing (section 3).

How much does your business plan to invest in marketing


services and media for 2015? (excluding salary)
ANSWERS SKIPS

76099%
5
1%

COUNT PERCENT

£0-£10,000 187 25%

£10,000-50,000 133 18%

Don't Know 111 15%

£50,000 - £100,000 92 12%

£100,000 - £300,000 79 10%

£1 million+ 71 9%
£300,000 - £500,000 45 6%
£500,000 to £1million 6%
42
0% 12.5% 25%

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