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Marketing Census 2021

    We could write something here about how tough 2020 has been. For personal reasons, we’ve all struggled in so many ways and we’re not out of the woods yet. For business reasons, many companies have struggled, people have lost jobs and the furlough scheme, while hugely positive, was also difficult to navigate and meant a whole new landscape for business that affected us all.

    But this report isn’t about focusing on the Covid-19 pandemic per se. Rather, it is our opportunity to reflect on the year in marketing and look ahead to 2021 and how we’ll attract interest, create desire and encourage conversions across marketing channels.

    We surveyed 344 marketing professionals across the UK and across sectors. Our respondents included marketing directors, managers and executives.

    Executive Summary

    Provided by Dave Cain, Senior Digital Manager at Arriva Group

    “Marketing is never straight forward. As much an art as a science, marketing in 2020 thrived on creativity, agility and ability to adapt to communicate a clear message – those marketers who were able to pivot their strategies and customer communications to the changing times inevitably came out on top.

    What’s clear as we move into 2021 is that, as marketers, we need to be even more focused than ever on the customer. In order to earn the interest and trust of our target audience, we must be interested in them first, to invest in a deeper understanding of who they are, what makes them tick and the topics that are most likely to engage with them and lead them eventually to a desire for our product or service – we need to have engaging conversations and we need to show we listen and care.

    Practically speaking, that means we must be hungry for data beyond that bottom-line conversion; the famous Sherlock Holmes once said “It is a capital mistake to theorise before one has data” – we must recognise the full marketing funnel, hone our ability to attribute action to marketing activity and invest in techniques that optimise the full customer journey, not just the point when they click that all important ‘buy’ button. I read a quote on LinkedIn recently that suggested some businesses are relying on social to drive revenue; social can do this but it goes back to my earlier joint, we’ve got to have a conversation and show we care before we even get to the point of sale.

    The Marketing Census 2021 is a chance to understand the common challenges we as marketers face. It goes without saying right now that Covid-19 will play a huge part in our business choices and successes this year, but so too will Brexit – something which is, even now, still to show its full ramifications.

    Then there are channel choices; the range of marketing channels available to us is growing every day and in order to thrive in the coming year, we need to be open to testing everything, finding the most effective channels to appeal to our specific audiences – again, we need to be leveraging data to support business choices. With all of this in mind, outsourcing of very specialist activity will make sense, allowing those tactics to be trialled without a big investment in in-housing the skills and also provide agility to test and learn at pace.

    2021 will hold brand new challenges for us as marketers and also in the digital space as we continue to adapt and evolve. But what is clear from this Census is that we are all in this together.”

    Reflecting on 2020

    It’s been quite a year! Here’s how businesses tell us they fared in 2020.

    Did your business grow in terms of turnover in 2020?

    We asked our respondents whether their business grew in terms of turnover in 2020. While the majority told us ‘no’, well over a third did experience growth – with over half saying either ‘yes’ or ‘unsure’.

    The landscape may have been a tough one but it wasn’t all bleak. The chart below shows the breakdown of results:

    We can see how this splits down by location, too:

    Our analysis shows that the businesses that struggled most in terms of turnover growth in 2020 were based in London and the South East of England, while the businesses that thrived the most were based elsewhere in Europe.

    In terms of sector, businesses in software, retail and marketing fared the best in 2020 with the majority reporting turnover growth. Manufacturing, charity and hospitality struggled the most, according to our analysis:

    What impact has Covid-19 had on your business so far?

    We couldn’t talk about 2020 without considering how the pandemic has affected business. But again – while it would be easy to assume the effects have all been negative – there are those companies that have thrived during this time, perhaps due to changes in their customer base or the provision of their goods/services providing benefit during the pandemic.

    Here, we see that the majority of businesses did indeed feel a negative impact, but that over half reported no impact or a positive impact:

    This breaks down by location like this:

    The location most negatively impacted by Covid-19 was London and the South East of England. The most positive impact was seen in the South West of England, while the North of England was most likely to see no impact, according to our survey.

    What was the biggest challenge your business faced in 2020?

    We asked respondents what the biggest challenge they faced in 2020 was. For the majority (52%), reduced demand or economic factors were the biggest challenge – unsurprising, given the impact of the pandemic, but also interesting to note that the pandemic affected demand far more than fulfilment. Businesses were able to deliver, but had fewer people to deliver to.

    Meanwhile, a further 47% of businesses explained that their biggest challenge was something other than reduced demand – with access to finance, marketing, recruitment, manufacturing and delivery all being noteworthy challenges with around 7% of the vote each. While the pandemic has hit demand, the other challenges shown here are proof that the difficulties we’ve faced as marketers have been much further reaching, too.

    What were your most successful marketing channels in 2020?

    The marketing channels that drove success for businesses in 2020 were primarily online, with just under 12% of marketing success coming from offline channels including television, direct mail and out of home advertising.

    When it comes to online channels, the most success came, according to our research, in social media followed by SEO, with just over one in five respondents citing the former and just under one in five citing the latter.

    With one in three respondents stating their marketing spend decreased between 2019 and 2020 (a statistic we’ll explore more later), the success of potentially low spend channels like social media and search engine optimisation is not surprising as businesses likely put more effort, if not budget, into reaching users this way.

    “SEO is a formative element of business marketing strategies today and to fail to achieve visibility through search is to fail to reach a large proportion of the audience – and this is true across the vast majority of sectors and business sizes.

    “To see businesses finding success through SEO comes as no surprise and for those who invest well, this will likely continue into 2021 and beyond. Google’s focus is increasingly on delivering excellent user experience; those brands that want to succeed in search will need to follow suit by focusing on their own users as a priority.” Pete Jovetic, Head of SEO at Impression

    CRM and email were also highly rated in terms of their success as marketing channels – a likely response to the pandemic in that businesses have been keen to reach customers in their homes where appropriate and to take a more direct approach to outbound marketing.

    Paid media also ranked highly, though the success of advertising is undoubtedly linked to the availability of product – where there is product or service available, the reach of paid media channels, from PPC to paid social to remarketingvideo and more is vast, and the potential to deliver high ROIs is huge, when managed well.

    The lowest rated marketing channel for 2020 in terms of its success was out of home advertising, such as billboards, buses and roundabouts – no surprise, given the lockdowns and lack of commuting during the year – what remains to be seen is whether these channels will see a resurgence in 2021.

    How did you measure the success of your marketing channels in 2020?

    It’s always interesting to reflect on how we measure the success of our marketing channels. Particularly in digital marketing, our ability to track the outcome of our investment is greater than ever before and in order to make savvy business choices, we need to make decisions based on data – and for that, we need clarity of goals.

    What we see in the results of our Census is that for the majority of marketers, success is measured in terms of either number of leads generated, or number of sales made:

    Return on investment (ROI) and target cost per acquisitions (CPAs) were also key metrics for those businesses monitoring the financial return on their marketing investments. A further 10% of marketers are monitoring audience size and engagement metrics as a key indicator of performance – showing how our focus is not only on the financial impact of our work, but on the experience of our customers, too.

    “When considering how best to make decisions based on KPIs, it is important not only to consider the bottom line conversions but also the micro conversions that occur along the marketing funnel.

    “Especially when investing in activities which interact with consumers higher up the funnel – things like social media, PR and offline ads – we must recognise the influence of those channels on the later conversion decisions.

    “Furthermore, it is those businesses which invest in building a brand to which customers can be loyal that will succeed in the long run and monitoring goals relating to customer experience as well as sales made will reap rewards in terms of visibility, conversion and retention.” Laura Hampton, Head of Digital PR at Impression

    Where did you allocate the majority of your marketing spend in 2020?

    The majority of marketing spend went online in 2020, according to our research:

    Did your marketing budget change between 2019 and 2020?

    We may not have known what was to come back in 2019, but it seems we still lacked a consensus as to whether our investments should grow or shrink.

    Here, we see that the majority of marketers increased their spend between 2019 and 2020, with just under 40% reporting this. A further 33% decreased their spend, with 28% keeping it exactly the same.

    We also asked marketers whether their budget allocation changed as a result of Covid-19. Just under 40% told us their marketing budget decreased in line with the pandemic.

    However, again, it wasn’t all bleak for marketers; in spite of the pandemic, a further 62% said their budget either stayed the same or increased – with 30% reporting the latter.

    Marketing teams also grew in 2020 for nearly one in three businesses:

    Looking ahead to 2021

    2021 is already off to a tough start and while the Covid-19 vaccine is incoming (at the time of writing this report), we recognise that businesses across the globe are likely to face an array of pandemic-related issues in the year to come.

    We asked marketers to tell us about their expectations for 2021.

    Do you expect to grow in terms of revenue in 2021?

    The majority of businesses expect to see growth in 2021:

    This is hugely positive to see, with nearly 90% of respondents stating they expect their business to grow.

    This positivity was true across all locations and when we look at the breakdown by industry, it looks like this:

    As we see here, manufacturing as an industry is the most optimistic for 2021, followed by marketing/advertising and professional services.

    “The future of manufacturing in Britain is bright however it’s integral that businesses do not rest on their laurels and continue to adapt over the next few months to ensure the initial period after Brexit runs as smoothly as possible.

    “Despite the fact we completely manufacture all of our water softeners from our factory in Woking and haven’t been as affected by Brexit when compared to other manufacturing firms, we have continued to invest in new product lines and processes such as testing to improve efficiency in the year ahead.

    “Of course, the challenges associated with COVID-19 still continue to affect typical day-to-day operations, but it’s critical that UK companies continue to invest in quality and consider the opportunities available long term once we are through the other side of this pandemic.” Tony Jones, general manager, Harvey Water Softeners

    Those in hospitality, charity and publishing are the least optimistic, having the highest proportions of responses to the negative, but in spite of that, even they expect growth in at least 66% of cases.

    “We are very optimistic that 2021 will bring growth to manufacturing as people who have had the opportunity to focus on projects they’ve been thinking about starting for some time, put their plans into action. We have already found an increase in enquiries from potential customers who have been furloughed during the pandemic for example, and expect that trend to continue.

    “Although we work in the clothing industry, we expect that this trend will carry over to other industries where people have had time in the last year or so to make plans for projects they otherwise wouldn’t have.”

    Rob Williams, Director, Hawthorn International

    How will Covid impact your business in 2021?

    The impact of Covid-19 has been varied in 2020 in a business sense. In some cases, the reduction in demand has been crippling, while in others – especially those in fitness, home improvement, technology and cookery – the increase in demand has really bolstered business.

    Looking ahead to 2021, just under two-thirds of marketers expect a positive impact in 2021 – be that due to increased demand or a reflection on marketing practices to make the most of the situation. Just over one in five expect a negative impact, while the majority – at just under half – remain unsure:

    How will Brexit impact your business in 2021?

    Interestingly, the bigger impact is expected to come from Brexit, with more than one in five businesses expecting a negative impact and nearly 70% still unsure as to how leaving the European Union will affect them:

    While Covid has 42% of marketers unsure about the impact, Brexit has more than two thirds of businesses feeling lost and confused.

    “Brexit is a real concern for many companies. The deal has indeed been done, but we are only now finding out what the fine print was and what this might mean for business.

    The fishing industry is a good indicator of how it might impact other industries. As a headline issue, it has gained a lot of immediate focus, but could point to where other industries might struggle.

    It is hard to truly see the extent of impact however as lockdowns and restrictions due to COVID-19 are having a big impact. Deals gained elsewhere with non-EU countries might well make up the deficits initially experienced with the EU trade deal. In the short term we may see difficulties, but overall the long-term prospects are bright.” Rick Smith, MD of Forbes Burton

    As shown in the chart below, even those outside of the UK are unsure as to the impact, with 85% of respondents in Europe stating they are unsure about the effects and 65% in the rest of the world. Meanwhile, businesses in the South West of England are most optimistic and those in London and the South East of England are least optimistic:

    “The businesses that will succeed post-Brexit are those looking further afield from our EU neighbours, looking at emerging economies – we are seeing strong demand from clients in other territories, in Africa and the Middle East.”

    Laura Trendall Morrison, founder, gamechanger consultancy ltd

    What will be your biggest challenge in 2021?

    The biggest anticipated challenge in 2021 is reduced demand or economic factors:

    This differs to 2020 in that the manufacture and sourcing of product is expected to be a challenge for fewer businesses, while access to finance, marketing and recruitment are all expected to be a challenge by more businesses than last year:

    When it comes to access to finance, the number of businesses expecting this to be their biggest challenge has increased by just under 15%, for marketing the increase is just under 32% and recruitment is 19% up year on year.

    “Recruitment is likely to become more challenging in 2021. This is largely due to the growing need for traditional ‘bricks and mortar’ retailers to get online.

    “While this is of course very positive for performance marketers in general, and will open up employment opportunities for graduates and entry level workers that have not previously been available to them, it will potentially lead to a shortage of senior level online marketing professionals – particularly those with ecommerce centric experience. 

    “The surge in demand will inevitably lead agency owners to do all they can to retain staff to cater for a positive upswing in the number of clients on their rosta.”

    James Congdon, Director, WithFrontier

    What will be your most successful marketing channels in 2021?

    The expectations we have around marketing channels for the coming year are indicative of the investments we are most likely to make in 2021. The chart below shows that the majority of businesses expect paid media to be their most successful channel, with out of home ads expected to be the least effective:

    The difference between 2021 and 2020 is shown below:

    The chart shows that the expectations around paid media differ significantly from reports of its success in 2020 – with the percentage of businesses that saw paid media as a successful investment in 2020 being 7.5% vs 33% that expect it to be successful this year.

    Meanwhile, expectations around SEO and social media marketing are far lower than reports from the previous year would suggest them to warrant – with fewer businesses expecting them to be successful in 2021 than reporting them as successful in 2020.

    How will you measure marketing success in 2021?

    We asked businesses how they will measure marketing success in the year to come:

    Once again, the number of leads and number of sales are the top measures of success for businesses. The chart below shows how this compares to 2020:

    As shown here, the percentage of businesses measuring success in terms of number of website visitors has dropped 10% year on year, while reliance on organic search rankings has declined by 40% between 2020 and 2021.

    “Marketing is rarely an exact science but the rise of digital channels means we can be more data-driven than ever before – and the reality of savvy business is that we need to adapt to emerging sales channels.

    “For those businesses that want to measure the return on their investment (and that should be 100% of businesses), digital marketing channels are areas where budgets can related directly to profit. While it’s no surprise to see so many marketers reporting their budget will go online, it is surprising to see a quarter of them suggesting they will spend more offline, especially given that the pandemic isn’t over yet.

    “The pandemic has changed shopping habits. The high street demise has been accelerated by five years or more. And the market leader in the UK, Amazon continues to find more ways for us to spend money with them.

    “The launch in 2020 of Amazon Wardrobe and Amazon’s response to online pharmacies, it is interesting to see how few marketers have embraced the major product search engine. Amazon’s advertising revenue will grow in 2021 – Marketplaces with increasing consumers & soaring revenue will provide more tools for sellers to differentiate through advertising.” Rob Laughton, Digital Lead, Culligan

    Where will you allocate the majority of your marketing spend in 2021?

    We asked respondents where they expect to allocate their marketing budget in 2021 and more than two thirds will dedicate most of their spend to online marketing channels:

    As the country moves into further lockdown and the year ahead is still uncertain, it’s little surprise to see the prevalence of online tactics as a means of reaching consumers within their homes and connecting with them over the longer term.

    “As demand goes up for online shopping and activity, more marketers are going to need paid media to reach their customers. But these are increasingly complex channels, so it makes sense that it’s a channel that will be outsourced more in 2021 as businesses seek specialist support to maximise the return on their advertising spend.

    That said, with the rise in automation this should make it easier than ever for marketers to get a hold of these channels without having to outsource. By investing in tools to facilitate automation, marketers will be able to reach even more users in smart and strategic ways – meaning they will need more clarity than ever on metrics such as target cost per acquisition and improvements to their websites to encourage conversions.

    What will be really interesting in 2021 is to see how businesses adapt and accelerate their digital transformation. There is increased demand for more digital products and subscription services but not every brand will be able to digitise its product or offering. In this case brands need to consider how digital can streamline the processes that surround the product for a seamless end-to-end experience.” James Murray, Product Manager at Bing

    Will your marketing budget change in 2021 compared to 2020?

    When asked if their marketing budget will change this year from last, more than half said that it will increase – a positive reflection on aspirations for the year ahead. A further third expect it to stay the same, while just under 8% say that their marketing budget will decrease in 2021:

    The sector where the greatest proportion of businesses expecting to increase their marketing spend is construction, followed by education and fashion retail:

    The sector with the highest proportion of businesses expecting to decrease their spend is marketing and advertising, followed by other retail and hospitality / tourism – the latter being of particular note because it is the sector with the most balanced opinion, 56% expecting an increase in spend vs 36% expecting a decrease. The hospitality sector, it appears, is still very uncertain.

    “The hospitality industry continues to be severely rocked by the pandemic, and it’s been vital for businesses to adapt in order to survive. We’ve managed to maintain rapid business growth at Yoello throughout 2020, largely because our platform has become a necessary tool for businesses in the ‘new normal’.

    “From a marketing point of view, I’ve found people have been more active online, so content is certainly getting seen. However with uncertain circumstances, businesses in the sector are particularly cautious around buying into new products – so it’s been important to be agile and shape our product and messaging around supporting current needs and situations.” David Bull, Senior Marketing Executive at Yoello.

    Meanwhile, just under half of respondents expect their marketing team to grow in 2021, suggesting a positive outlook for those working in the marketing profession who might be seeking a new role at this time:

    Which marketing channels do you expect to outsource, if any, in 2021?

    We asked respondents whether they expect to outsource any of their marketing functions in 2021 and the most popular answer was Paid Media, including PPCpaid socialdisplay and video:

    Online Marketing in 2021

    In this section of our research, we asked respondents to think specifically about online / digital marketing.

    We asked what digital marketing channels businesses expect to invest more in in 2021:

    As shown here, paid media once again holds the top spot with the highest percentage of businesses expecting to increase their budget in paid social media advertising and paid tactics through Google’s networks.

    Organic social media and organic Google channels (i.e. those for which there is no ‘pay to play’ element) are also expected to increase in 2021.

    How will Core Web Vitals affect your business in 2021?

    Google’s upcoming Core Web Vitals update will impact every website in the world by re-focusing on user experience – meaning that websites which give users a positive experience through working correctly, loading quickly, being usable and accessible and so on, will be benefitted.

    We asked marketers how CWV will affect their specific business in 2021 and the results are revealing:

    The greatest proportion of businesses (just under two in three) told us they don’t know about or don’t understand Core Web Vitals, with more than one in five saying they understand but don’t know how it will affect them.

    Watch our webinar if you’re still not sure what Core Web Vitals mean for your business or what actions you need to take to prepare.

    Will online behaviour change in 2021?

    Finally, we asked our respondents whether they expect online behaviour to change in 2021, the answers being Yes – more people will go online to shop / find service providers, No – online audience behaviour will not change in 2021 and Yes – fewer people will go online to shop / find service providers:

    Nearly nine out of ten marketers believe more people will go online to shop / find service providers in 2021 compared to 2020 – perhaps coming as no surprise, given the investment marketers expect to make in online channels.

    “The winners from this situation would be businesses that were investing in their online presence way before the pandemic took place. 

    Yes, you can still leverage your brand and your existing customer base by serving them online. You can also use ads to get new leads to your website the same day. But building up organic (free) traffic to your website takes a lot of time and effort, this is not something that can be done quickly.

    That said, it is not an excuse to give up and do nothing. This is merely a good example of how investing in your online presence now can be essential for the survival of your business in future.”

    Tim Soulo, Chief Marketing Officer at Ahrefs

    Methodology

    This survey was conducted in December 2020 and was open to business owners, founders, leaders and marketers, promoted via social media, email and event / groups.

    Our respondents mainly came from the UK, with 89% stating their business is based primarily in the UK. 90% told us their role was either marketing or the business owner / founder, with a further 10% working in operational roles.

    One third of our respondents were directors / C-suite in their business, a further 15% were heads of departments, 23% were senior managers, 21% were junior managers and 7% were in junior or graduate roles.


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