CMO DIGEST 2023

Thinking about the whole last year, how would you describe 2023 as a marketer? In today's day and age I often find my colleagues lost in the amount of news appearing every day. Thus, I find news curations (e.g. Contagious or WARC) pretty useful, but I have never found the one for CMO's scope of work and this is why you are reading this article. For the debut edition, I summed up the most interesting news from the industry last year. I hope you will enjoy your reading.

Brands and Campaigns

Of course, there have been many different campaigns around and I surely have my favourites, but it would be a pity to not mention the best-awarded campaigns of 2023. You know what I am talking about, it is Cannes Lions 2023. As many of you know, the highest-ranked award you might receive at Cannes is a Grand Prix. There were 23 Grand Prixs given last year and there certainly was an interesting trend. There were 21 winning campaigns based on a technological or a digital solution as the key technique. This makes 62%, for a comparison one year ago there was 50%. We can see a rising trend of creative technologies and digital innovation playing the main role in creativity. If I had to highlight my favourite grand prixs, these would be Stella Artois, Apple Series and Cardburry.

Research

The most interesting research, it would be personal. I fell back in love with the topic of "Medium is the message". Unconventional advertising methods can provide marketers with innovative ways to engage their target audience and strengthen brand associations. A recent meta-analysis exploring the impact of creative media advertising reveals significant findings that marketers can leverage to enhance their advertising strategies. The study confirms that compared to traditional media advertising, creative media advertising has a positive effect on both brand association strength and persuasion. Moreover, the use of metaphors in creative media ads amplifies these effects, making them even more powerful. Indirect exposure to the message through social media or printed pictures also enhances brand association strength. Notably, the research indicates that creative media advertising is particularly effective in driving electronic word of mouth (eWOM), highlighting its potential for generating buzz and spreading brand messages organically. These findings emphasize the importance of incorporating surprise and metaphors in creative media advertising campaigns, as they can increase persuasiveness and overall brand impact. Marketers can use this knowledge to create memorable and impactful ad campaigns that resonate with consumers and drive favorable brand outcomes.

Media

The general trend is digital. According to WARC, global advertising expenditure is on a significant upswing with a projected 4.4% growth in 2023 year and an impressive 8.2% surge anticipated in 2024. This surge will propel the market to unprecedented heights, exceeding $1 trillion for the first time. The tech giants like Alibaba, Alphabet, Amazon, ByteDance, and Meta—are set to collectively command over 50% of global advertising spending this year growing in revenues by 9.1% in the current year and 10.7% in 2024. Social media will lead the pack, with an estimated $227.2 billion in spending by next year, representing 21.8% of total ad expenditure, primarily driven by Meta. Retail media and connected TV will also experience robust growth, with Amazon and CTV together accounting for a substantial share of spending. One of the most interesting trends was also AVOD. Video-on-demand revenue from ad-funded platforms (AVOD) will also grow faster than subscription revenue (SVOD) over the next five years, according to Digital TV Research’s report. AVOD revenues are forecast to increase by $10bn between 2022 and 2028 to reach $16.2bn in Western Europe, while SVOD revenues will total $23.6bn by 2028 — up 41% from 2022. Last but not least - podcasts. According to eMarketer, there are 464.7 million worldwide podcast listeners. That equates to 22% of all internet users.

Innovations and Tech

Another platform showing incredible growth was ChatGPT. The fact that OpenAI gave the public access to its model 3.5 was remarked by us as the strongest innovation. Not long after this announcement, the platform acquired one hundred million monthly users, which was rather fast compared to the other platforms. They also gave access to their API as many other companies also did, which resulted in upgrading other companies' products and services. We now have Gen AI in campaigns on Google and Meta. But we also have a tonne of other Gen AI tools. According to Acumen research, this bubble is gonna grow enormous and is supposed to reach almost 2009 billion dollars in 2032. As you can see, there is a lot to be thrilled about and hopefully, we will be surprised again in 2024.

Distribution

One of the biggest news from the last year was the boom in retail media. That's a big thing. According to WARC’s estimate that global investment in retail media would reach $121.9bn in 2023, making it the fourth largest channel. Amazon's ad business is expected to be more than 50 billion dollar, which is trully shocking since it would be bigger than the global outdoor industry and the whole industry of publishing. For those, who is still confused retail media are all sorts of adplacements withing retailers' environments. The most common example is the section "sponsored products" with a picture of the newest Playstation on Amazon, but it also can be a POS at your local grocery store.

Consumers and Economy

We saw an economically weaker year in 2023, however economies of the US, UK and EU were still growing at a weaker pace. Organisation for Economic Co-operation and Development's (OECD) predicts the global growth to ease to 2.7% in 2024, from 2.9% this year, before picking up to 3% in 2025, due to real income growth recovery and lower interest rates. Eurozone's GDP is expected to swell by 0.6% this year. The UK is forecasted at 0.5% and the US at 2.4%. GDP growth has held up better in the United States and many other commodity-producing economies, but is expected to weaken in 2024 and 2025, meanwhile, Europe can expect a brighter GDP growth. Lastly, inflation is going to go down. Inflation in the Eurozone is going to slow to 2.9% next year following 5.5% this year and will settle at 2.3% in 2025. Generally, we are expecting higher and healthier consumption in the European markets compared to 2023.

Leadership

In this section we focus our attention on the way that marketers lead their teams in the context of an entreprise. One of the strongest statistics we saw last year was showing that the divide between CMOs and CEOs is growing. According to McKinsey, nine out of 10 CEOs say that the role marketing plays is clearly defined at their companies, according to a new McKinsey survey tracks relationships between CEOs and CMOs. But only 22% of marketing chiefs say their jobs are well-defined and understood by other C-suite executives, down from 31% in 2019. Similarly, 97% of CEOs think their companies meet customers’ needs, yet only 75% of CMOs agree, according to a May survey from Forrester. And 90% of CEOs say their companies’ strategies are driven by customers, while only 58% of CMOs say that is true, Forrester found. The good marketer should understand that his function is directly related to the brand's customer acquisition and should be able to explain it to the other divisions. Carry on with CMO digest and I'm sure you would be great at it.

Cheers!

This is it. Did you like the format? Definitely do not give it a like and don't you dare comment! Instead, check out Julian Cole. He's a pretty cool strategist. Otherwise, enjoy your week.