Consumers are more diverse than ever. They consume different kinds of media in many different ways. Further, there's no singular path-to-purchase buyers take. That leaves marketers with more options and questions about how, when, and where to reach and engage their customers.
As marketers are trying to determine the right combination of messages and activities for their audience, they are also being held accountable for sales targets and the ROI of their efforts.
Change is the new normal, and the pace is only accelerating.
The Shift to Agile Marketing
In the old days, brands formed marketing plans and established budgets to align with annual financial planning cycles and media buys. To determine how much to spend on specific tactics, marketers analyzed data from previous years or cycles.
The rapid evolution of marketing has forced brands to pursue more flexible planning models. In the digital arena, real-time marketing based on incoming data has been useful but only for improving tactical execution in a limited number of channels for a small percentage of the total budget.
Automation powered by algorithms has enabled brands to optimize digital campaigns and use automated bidding platforms for online ad purchases. But again, those are tactical in nature and don't deliver the kind of improvements brands need to keep pace with competitors.
Real time, however, is still not good enough.
The Benefits of the Agile Marketing Approach
To keep up with rapid changes, marketers need to continually identify opportunities and optimize plans before spending resources on execution. And that work needs to happen across the total marketing budget to drive the big improvements that make a difference on revenue.
Marketers need to use sophisticated analytics and automated technology for better strategy and planning. When marketers are equipped with solutions that allow them to develop improved marketing plans and more rapidly adapt to changes, the conversation moves from a tactical approach to a strategic one—the kind of approach that brands need to significantly increase sales and achieve real competitive advantage.
That's where technology-driven agile marketing planning enters the picture.
With a more agile marketing approach, brands can apply the right data and technology to four critical planning windows:
- Multi-year strategic planning
- Annual planning and budgeting
- Mid-course reviews (quarterly or monthly)
- Ad hoc responses to internal or external events
By transitioning to a more agile planning approach, brands can execute more strategically. The marketing process becomes more nimble and more capable of responding to changing business or market conditions.
The Nuts and Bolts of Agile Marketing
Brands need a model that delivers a results-driven long-term strategy with the ability to quickly respond to internal or external changes. And in many cases, the demand for more agile marketing is leading brands to software solutions that embody agent-based modeling.
Agent-based modeling drives better decisions. And when delivered in a software application, agent-based modeling drives agile marketing agendas.
Here's how it works: To improve planning and strategy, data scientists or consumer insights professionals create virtual marketplaces with virtual agents that simulate the buying and media behaviors of real-world consumers. Using a sophisticated mix of data on demographics, media consumption, and other market dimensions, those virtual marketplaces give brands definitive, actionable insights about how marketing plan changes will impact sales, their ROI, and other key metrics.
Agent-based modeling equips brands and marketers with the ability to run an endless variety of "what-if" simulations, uncovering the results attached to changes in the marketing mix before the changes actually occur.
Instead of dedicating budget spend to new initiatives and hoping for the best, marketers can quickly evaluate the impact that spend will have on top-line and bottom-line business outcomes.
Compared to traditional approaches, agent-based modeling provides a much better way to evaluate how combinations of marketing activities will influence consumer behavior and affect results over time. In addition to serving up information needed to develop annual or multi-year marketing strategies, agent-based modeling uses the most up-to-date information, current market conditions, and consumer behavior modeling to shape marketing decisions on a quarterly, monthly, or ad-hoc basis—as often as marketers need.
* * *
Brands can no longer rely on backward-looking data alone for strategy. More than ever, brands must be able to simultaneously adapt their marketing investments to current conditions and develop long-term strategies for their marketing programs.
Agile marketing and the use of agent-based modeling give brands the strategic firepower they need and the flexibility the marketplace demands. Just as importantly, these approaches give marketers and executives peace of mind that their marketing spend is being used to achieve maximum ROI and the best possible business outcomes.
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