Most people think of Hong Kong or Singapore as key hubs of the Asia-Pacific region and that might be true when it comes to banking or data centres; but in the case of digital marketing, recent data suggests Australia is leading the way. Australia is gradually catching up to countries such as the USA and many believe we’re teetering on the edge of digital domination in the region with many others trailing so far behind.
Right now, marketers in Australia are at the forefront of the adoption of digital in the region with 41% – 49% of CMO Digital Marketing Performance Dashboard 2013 marketers now allocating a quarter or more of their marketing budgets to digital marketing. The report also finds senior managers in Australia support digital more strongly than those in our neighbouring countries, with company heads more willing to embrace digital as a result of the ability to measure ROI and generate results cost effectively.
Top Priorities for digital marketing
Last year, the top priority for marketers in Australia was social media optimisation which has now been bumped to second place as 77% of respondents now say digital marketing content strategy is their number one priority. Third on the list was search and online display.
Digital marketing spend must increase
Although the CMO Dashboard report places Australia at the forefront of digital marketing in our region, many believe there are some major obstacles to overcome before the top position is cemented.
According to Paul Robson of Adobe who co-commissioned the Dashboard report, digital expenditure is still too low in Australia and marketers are not paying enough attention to ‘lifetime value’ and attrition rates. He remains optimistic though, stating “In spite of this, with so many of the fundamentals in place, Australia has the potential to establish itself as a regional centre of digital marketing expertise if these issues can be addressed.”
It’s quite possible that as ‘lifetime value of a customer’ moves onto the radar for more marketers, it will naturally have a positive effect on increasing digital expenditure as more businesses realise the true value of a new client and increase what they’re prepared to acquire one. Plus, with the unique (and largely unprecedented) ability to closely nurture clients, respond in real time and automate campaigns, we believe digital and social media used properly should assist businesses in significantly reducing attrition rates, thereby increasing lifetime value even more.
Digital marketing poses new challenges
The rise of digital marketing is presenting new challenges and new opportunities for Chief Marketing Officers everywhere.
The real-time nature of digital marketing and social media, along with the mountains of data they generate is both a boon and a burden. If it weren’t for the ROI information, the ability to measure response, easily test, compare and adjust campaigns, business leaders might not be so quick to offer their support. It appears these numbers literally provide marketers with digital marketing budgets.
Conversely, this data is just some of what CMO’s are bombarded with thanks to digital. Now, they know what times of the day their clients are most responsive, how many of them drive to work, what devices they use (and what for), which words get more online clicks, which get more sales, and a whole host of other minutia.
Where once marketing managers were wishing they had access to more insights about their customer and marketplace, today they have so much, the skill is knowing what’s important, what’s not, how to monetise it and use it to further business goals. Quite simply, CMO’s are drowning in data and often lacking the skills to interpret it.
We discussed concerns around this digital skills shortage in Australia recently on our blog which highlights the shortfalls of Australian businesses by global standards.
The number of devices people own and the various ones they use at different times and for different reasons poses even more challenges and opportunities for companies wanting to connect with their customers.
Other recent articles about the growth of mobile advertising (75% increase in mobile ad expenditure) and the use of mobile devices in email marketing (more than half of all email clicks and opens now happen on a mobile device), highlight the increasingly critical importance of responsive website design and mobile optimised email. This, along with other tech developments and relatively rapid changes in consumer behaviour all add to the pressures the modern marketing manager faces. Not surprisingly, most now opt for specialist help.
Demand increases for specialist digital marketing
With the highest portion of marketing budget in Australia now allocated to digital, 79% of companies rely on external specialists to deliver digital components, up 22% on 2012. Most of the money allocated to digital in Australia goes toward developing today’s business equivalent of a ‘shopfront’ or quality website content. It makes sense then that the other large chunks of the marketing budget are allocated to email marketing and SEO designed to drive customers to these websites.
When you think of it in simple terms, not much has really changed in the world of marketing and business. Words and pixels are your bricks and mortar, an interactive, user friendly design is your customer service team, direct mail has become electronic direct mail, SEO has replaced directory listings and social media has picked up where your PR agency left off.
Simple as it may be in concept, in reality, digital marketing is a whole new world and we’re excited to be at the forefront here in Australia.
iFactory is a dedicated Australian digital media agency, providing cutting edge, responsive website design, digital marketing, email marketing and SEO strategy to companies in the Asia Pacific region.
Drop us a note to see how we can get digital working for you.