A Forrester Consulting Commissioned By 4C July 2019 · › Lack of cross-channel insights...

A Forrester Consulting Thought Leadership Paper Commissioned By 4C

July 2019

Mature Your Video Marketing To Drive Business Value

Table Of Contents

Executive Summary

Marketers Should Be Insights Driven

The Shift To Being Insights Driven Takes Work

Marketers Invest To Become Insights Driven

Video Provides A Powerful Opportunity To Drive Business Outcomes

Vanguard Marketers Use Video For The Best Performance

Key Recommendations

Appendix

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2

3

4

5

8

9

10

ABOUT FORRESTER CONSULTING

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© 2019, Forrester Research, Inc. All rights reserved. Unauthorized reproduction is strictly prohibited. Information is based on best available resources. Opinions reflect judgment at the time and are subject to change. Forrester®, Technographics®, Forrester Wave, RoleView, TechRadar, and Total Economic Impact are trademarks of Forrester Research, Inc. All other trademarks are the property of their respective companies. For additional information, go to forrester.com. [E-42752]

Project Director: Chris Taylor, Senior Market Impact Consultant

Contributing Research: Forrester’s CMO professionals research group

Executive SummaryUnprecedented access to technology and information has spurred what Forrester calls the age of the customer — a time in which customers have more decision-making power and expect more from the brands that serve them. This change recasts how firms operate and create value. In particular, marketers need to better understand their customers’ needs and media preferences to provide impactful and relevant cross-channel advertising experiences with their brand, compared to competitors.

In April 2019, 4C commissioned Forrester Consulting to determine if taking an insights-driven, video-centric approach to media buying and management would enable more successful marketing efforts. To test this hypothesis, Forrester conducted a global survey of 505 marketing leaders responsible for traditional and digital marketing decisions (including video) in the US and UK. The survey found that firms that embrace insights-driven, customer-centric video marketing see greater returns.

KEY FINDINGS

› Marketers should be purposeful with how they use customer and marketing insights to improve marketing efforts (specifically media buying).

› Marketers need a clear insights strategy, which includes greater cross-channel data visibility and improved analytics capabilities.

› The majority of marketers recognize the importance of investing in better self-service advertising technology, improving cross-channel attribution, and optimizing use of video.

› Nearly 80% of marketers surveyed recognize video — including TV, digital video, social video, and over-the-top (OTT) video — as an increasingly important medium.

› Mature video marketers see better returns on advertising spend, conversion, and brand advocacy than their less mature peers.

1 | Mature Your Video Marketing To Drive Business Value

Marketers Should Be Insights Driven Consumer platforms and digital technologies produce troves of data like purchase history, location, media usage, behaviors, and even biometrics with new data types emerging regularly. In turn, companies collect and analyze this data to better understand their customers. However, collection and analysis are just an initial step. Companies must take action inspired by insights, or the data becomes useless.1

Forrester defines insights-driven businesses as those that harness and implement digital insights strategically and at scale, to drive growth and create differentiating experiences, products, and services. Insights-driven businesses, which actively utilize customer insights, will grow at seven times the global gross domestic product (GDP) over the next four years.2 One area where marketers can productively apply insights is in media planning and buying. Particularly, marketers have a big opportunity to use data to improve efforts with traditional media like TV, which hasn’t inherently been “insights driven” in the past, since it originated at a time when data accessibility wasn’t the same as it is today. But using an insights-driven approach to marketing with video across channels can increase efficiency, reduce costs, and drive improved business outcomes.

So how can marketers today become insights driven and begin to experience the growth associated with an insights-based approach to advertising and media buying? We asked respondents about how they plan to get started over the year ahead, and their top three priorities for the next 12 months (see Figure 1) are to:

› Get smarter with data. Marketers associate more effective marketing with better data usage. Improving the use of insights for business decision making is a top priority for 82% of respondents. Over 70% of respondents also prioritize breaking down data silos to build a more comprehensive understanding of customers.


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Full page Figure 1: Marketing And Business Priorities Are Well-Aligned With Becoming Insights Driven

Primary business priorities for the next 12 months(Top �ve responses shown)

Primary marketing priorities for the next 12 months (Top four responses shown)

Base: 505 marketing managers responsible for marketing decisions in the US and UKSource: A commissioned study conducted by Forrester Consulting on behalf of 4C, April 2019

84% Grow revenue

82% Improve use of data insights in business decision making

82% Improve customer experience

78% Accelerate our shift to digital business

75% Reduce costs

43% Improve our use of data and analytics

40% Align brand promise with customer experience

38% Accelerate our use of digital marketing tactics

36% Improve the ROI/effectiveness of marketing

Critical or high priority % selected as a marketing priority

› Align brand promise with customer experience. Improving customer experience is a top priority for 82% of respondents. The best customer interactions solve customer problems while also demonstrating company values.3

› Accelerate the use of digital marketing tactics. Over 75% of marketers want to accelerate their use of digital technologies. For some businesses, this means bringing a digital mindset to the entirety of their media programs, including audience targeting, optimization of campaigns in real time, and better measurement to align marketing efforts with key business outcomes.4

The Shift To Being Insights Driven Takes WorkBecoming insights driven is easier to talk about than to put into practice. Our survey revealed that the following hurdles trip up marketers as they work to be more insights driven (see Figure 2):

› Lack of cross-channel insights visibility. Marketers can’t plan customer-centric campaigns if they only have access to insights about a customer in an isolated context; 59% marketers struggle with marketing and audience data stuck in silos. The result: 67% of marketers lack the proper visiblity into holistic insights, which can slow decision making and limit value.

› Limited ability to act on data. Respondents experience several issues with putting data-driven insights into action. First, over 70% of marketers cite a lack of proper analytics skills/expertise and tools, with 53% also lacking a clear strategy around data usage. Second, even if they had the proper skills and strategy, 66% aren’t flexible enough with creative or budget to quickly adjust campaigns based on insights.

› Lack of centralized technology to deploy campaigns across multiple channels. Cross-channel marketing can be difficult if marketers lack an efficient way to connect efforts across disparate engagement channels. Different channels require different tools that are often operated separately. This lack of centralization is a challenge for 65% of marketers surveyed.

› Challenges with placing and measuring advertisements, specifically video. Marketers will struggle to use advertising to drive outcomes if they lack the capabilities to measure results across channels and adjust strategies based on those results. Nearly 70% of marketers surveyed report video ads as challenging to place and measure compared to only 58% who struggle with static ads (see Figure 3).

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Full page Figure 2: Top Challenges To Being An Insights-Driven Marketer

Lack of insights visibility

Limited ability to act on data

Lack of centralized technology

Dif�culty placing and measuring ads


Marketers Invest To Become Insights Driven Marketers in our study want to be insights driven with their advertising and media efforts. Specifically, they:

› Invest in more self-service advertising technology. Teams across the enterprise must have access to data (e.g., customer, performance, planning, etc.) to be an insights-driven company.5 This requires integrating data from multiple sources into shared dashboards and complementary tech, making it available to stakeholders across an organization. In addition, 81% of marketers surveyed say that investing in self-service advertising is very important because it provides more visibility into media and advertising, which supports better campaign planning and management.

› Master cross-channel attribution. Marketers must be able to measure the cross-channel impact of their advertising efforts to better target their marketing efforts in the future. To this end, 71% of marketers indicate that incorporating a wider range of marketing data to improve campaign attribution is very important to them.

› Optimize cross-channel video. Marketers recognize the potential in an insights-driven approach to video advertising. In fact, 66% of marketers surveyed consider optimizing cross-channel TV/video efforts to be a very important priority; 77% want to provide consumers more targeted video content.

4

46% of marketers surveyed don’t believe they have the right tools to execute video-centric marketing campaigns in the right consumer channels.

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Full page Figure 3

“How challenging is it to place and measure the following advertisement types with your current toolset?”


Video advertisements 32% 37%

Static advertisements 20% 38%

Interactive ads 15% 30%

Very challenging Moderately challenging

Video Provides A Powerful Opportunity To Drive Business OutcomesAs marketers take a more insights-driven approach to their advertising and media buying, video will become a more prominent tool in their marketing toolkits. More than 75% of marketers surveyed recognize video (including TV, digital video, social video, and OTT) as an increasingly important medium (see Figure 4). They also agree that video:

› Is evolving to enable better targeting. Our survey found that 75% of marketers agree that video is evolving from a mass-reach medium to one that enables targeted reach to more precise audiences. Accordingly, 77% of marketers state that providing consumers with more targeted video content is a very important marketing initiative for their organization.

› Can do more than boost brand awareness. Video has historically been viewed as a tool for building brand awareness, but different applications of video can extend the impact of video ads. That is why 70% of marketers agree that effective use of video can boost business performance in other channels, like delivering higher organic site visits and increasing position in search results.


MORE MATURE MARKETERS MODEL HOW TO USE VIDEO BEST

We expected that marketers who apply a more sophisticated, insights-driven approach to video would achieve better marketing outcomes. To prove this out, we asked our survey respondents a series of questions related to how they manage video marketing. Questions focused on four themes:

1. Velocity. We wanted to understand the breadth of data sources and data types companies collect overall — and how well they ingest and activate that data in a timely manner.

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Full page Figure 4

Video Is Evolving And Becoming More Important To Marketers (% who agree or strongly agree)

Base: 505 marketing managers responsible for marketing decisions in the US and UKSource: A commissioned study conducted by Forrester Consulting on behalf of 4C Insights, April 2019

79% Video (including TV, digital video, social video, and OTT) is an increasingly important medium for consumers

79% Instream video ads drive business outcomes more effectively than other ad types

75% Video is evolving from a mass-reach medium to one that enables targeted reach to smaller, more speci�c audiences

71% Video is evolving from a brand awareness format and should be used to impact speci�c business outcomes

70% Video ads (including both instream and outstream ads) boost performance in other channels (e.g., higher organic site visits, increased search results, etc.)


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Full page Figure 5: Maturity Overview

Vanguards(high maturity)

Video Marketing Maturity

Velocity Video Visibility Value

Starters(low maturity)

Base: 505 marketing managers responsible for marketing decisions in the US and UKSource: A commissioned study conducted by Forrester Consulting on behalf of 4C Insights, April 2019

• Have limited organizational priority on being insights driven

• Use fewer data providers and data types

• Use basic data analysis techniques

• Use a wide range of data providers and types

• Use audience data to improve advertising effectiveness

• Use advanced data science technologies

• Target video based on speci�c customer needs

• Prioritize engaging video ad formats with impactful rich media content

• Use video for omnichannel advertising

• Ensure data access is democratized by using self-service tools

• Use data across multiple channels and touchpoints for cross-channel engagement

• Use business KPIs and insights to drive media planning, buying, and targeting

• Work to continuously improve ad campaign outcomes

• See video as primarily a mass-reach medium and less targeted

• Place low priority on video ad formats

• Use video in limited channels

• Limit data access to data scientists, and there is little self-service data technology for various teams to utilize

• Manage data in organizational silos

• Do not measure KPIs that are relevant to business outcomes

• Are ineffective at connecting insights with media planning

2. Video. We dug into the types of video formats companies use and into how they plan for TV, digital video, social video, and OTT video — e.g., referring to premium video content streamed through the internet onto a connected TV device, laptop, mobile phone, or tablet.

3. Visibility. Questions here probed on how marketers break down silos to improve visibility of the media supply chain and cross-channel results.

4. Value. This theme evaluated the ways in which a company measures advertising effectiveness to continuously improve its ability to drive business outcomes.

We calculated a maturity score for every respondent in our sample based on their responses, scaled scores onto a 100-point scale, and sorted our quantitative sample into three segments for further analysis: Starters (less mature), Intermediates, and Vanguards (more mature). See the Maturity Overview (Figure 5) below for more details.

By profiling the differences between Starters and Vanguards, we see that Vanguards feel much better prepared to deliver on initiatives to become insights driven and video-centric compared to Starters (see Figure 6). Differences between the segments also illuminate the habits that those who desire to be more insights driven and video-centric should adopt.

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Full page Figure 6

“How well prepared is your organization to deliver on the following capabilities or initiatives?” (% very prepared)


33%

74%

21%

53%

32%

50%

17%

50%

13%

42%Investing in more data visualization solutions that combine data from

multiple sources

Improving cross-channel attribution

Investing in more user-friendly, self-service advertising technology

tools to have more visibility

Optimizing our omnichannel TV/video efforts

Providing consumers with more targeted video content

Vanguards Starters


66% of Vanguards act on audience insights and performance data to continually optimize advertising effectiveness and business outcomes, compared to just 32% of Starters.

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Full page Figure 7

“Which of the following benefits have you realized from prioritizing audience-based media planning and targeting?”


35%

49%

30%

48%

33%

55%

35%

52%

45%

58%Increased average order value

Increased brand advocacy

Opportunity to introduce cross-selling options

Increased conversion rates

Greater return on advertising spend (ROAS)

Vanguards Starters

Vanguard Marketers Use Video For The Best PerformanceMarketers who take an insights-driven, cross-channel, and video-centric approach see positive business outcomes from their advertising (see Figure 7). Specifically, compared to Starters, Vanguards enjoy greater:

› Return on advertising spend (ROAS). Targeting advertising to more relevant customer audiences or segments drives greater return from media spend. Nearly 50% of Vanguards cite this as a benefit, compared to roughly one-third of Starters. Furthermore, 66% of Vanguards act on audience insights and performance data to continually optimize advertising effectiveness and business outcomes, compared to just 32% of Starters.

› Conversion rates. Targeting can also improve conversion rates. Vanguards are better at leveraging customer insights to optimize their media targeting, which can improve conversion rates. A recent Forrester report found that interactions with video can nearly double conversion rates.6 While video may not influence all consumers equally, audience-based media planning can help target the people who like it the best. Our survey found that 80% of Vanguards — compared to 52% of Starters — regularly review and adjust their media strategies to account for consumer media habits and marketing trends. As a result, nearly 20% more Vanguard companies have experienced an increase in conversion rates.

› Opportunity to introduce cross-selling options. Advertising messages tailored to audience segments based on past purchases or funnel behavior give more opportunity for targeted cross-selling. Insights-driven media planning and targeting enable customer segmentation and journeys to better inform advertising. This is a top benefit for 55% of Vanguards versus just 33% of Starters.

Key RecommendationsMarketers must take an insights-driven, video-centric approach with their media to drive the greatest business value with their advertising. Based on learnings from this study and Forrester’s breadth of other research, we recommend the following steps to evolve your own approach toward that of mature Vanguard marketers.

Diagnose your current state. It’s difficult to know how much insight or video marketing reinvention you need without knowing how good you are at either today. Take stock of both weaknesses to correct and strengths to exploit, and build your marketing strategy from that point.

Plan for how people consume media. Step one here is to keep up on your customer video habits. Many US consumers today watch network programming in a nonlinear format, like streamed or downloaded through a device that is not a television; almost 194 million US consumers watched some form of ad-supported free streaming in 2018.7 Track how this habit changes your customer time and values priorities. Step two is to pivot to a continuous, flexible model for marketing planning, which enables you to move budget in or out of media formats based on how customers actually use or respond to the media.8

Benchmark your budgets. Forrester projects instream and outstream video advertising to grow at a 13% compound annual growth rate between now and 2023.9 Even without television ads (which this forecast does not include), video will clip faster than all other digital marketing formats.10 Precise budgets should depend on the video adoption of your customers (is your primary audience empowered or resistant to emerging media?) and your business model (how directly do you sell to your end customer?). But if you aren’t growing your current video budget at least 10% year on year, you will fall too far behind market expectations to ever catch up.


Appendix A: Methodology In this study, Forrester surveyed 505 marketing managers responsible for marketing decisions in the US and UK. Survey participants were from a mix of marketing and advertising roles with decision-making influence over marketing strategy and technology decisions. Questions provided to the participants asked about their companies’ use of customer data and video to support key business outcomes. Respondents were offered a small incentive as a thank you for time spent on the survey. The study was completed in April 2019.

Appendix B: Demographics/Data


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Base: 505 marketing managers responsible for marketing decisions in the US and UKNote: Percentages may not total 100 because of rounding.Source: A commissioned study conducted by Forrester Consulting on behalf of 4C, April 2019

NO. OF EMPLOYEES

COUNTRY

47%2,500 to 4,999

44%5,000 to 19,999

9%20,000 or more

INDUSTRY

60%US

40%UK

TITLE

ManagerDirectorVP C-level

7%15%

36%

43%

14%

14%

14%

15%

15%

16%

eCommerce

Technology & tech services

Telecommunication services

2%

3%

7%

Wholesale and distribution

Consumer goods/manufacturing

Retail

Automotive & transportation equipment

Financial services/insurance

Media and/or leisure

Appendix C: Endnotes 1 Source: “The Customer-Obsessed Enterprise,” Forrester Research, Inc., June 25, 2018.2 Source: “Insights-Driven Businesses Set The Pace For Global Growth,” Forrester Research, Inc., October 19, 2018.

3 Source: “Thriving In A Post Digital World,” Forrester Research, Inc., April 26, 2016.4 “The Model For Modern Marketing,” Forrester Research, Inc., March 8, 2019.5 Source: “Insights-Driven Businesses Set The Pace For Global Growth,” Forrester Research, Inc., October 19, 2018.

6 Source: “Make Your Video Shoppable To Boost Online Conversion,” Forrester Research, Inc., February 23, 2018.

7 Source: “Forrester Analytics: Video Advertising Forecast, 2018 To 2023 (US),” Forrester Research, Inc., August 6, 2018.

8 People-led-planning replaces the traditional linear marketing planning process with one that is continuous, with ongoing measurement and fungible budgets. Source: “Forget Everything You Think You Know About Marketing Planning,” September 5, 2018.

9 Source: “Forrester Analytics: Video Advertising Forecast 2018 to 2023 (US),” Forrester Research, Inc., August 6, 2018.

10 “The US Digital Marketing Forecast, 2018 To 2023,” Forrester Research, Inc., February 7, 2019.


A Forrester Consulting Commissioned By 4C July 2019 · › Lack of cross-channel insights...

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