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Staying current and continuously educating ourselves on various aspects, including marketing, is paramount. As we step into the new year, why not revisit the fundamentals and establish the contemporary definition of marketing within the financial services industry? This entails recognizing the evolutionary trajectory that marketing has traversed and discerning what constitutes effective strategies today. Traditionally, marketing encompassed conventional methods such as print advertising, television and radio commercials, direct mail marketing, trade shows, and word of mouth. While these methods may still yield results, they often lack the precision and cost-effectiveness inherent in digital marketing techniques. Digital marketing, also referred to as inbound marketing, leverages online platforms, tools, and strategies to reach specific audiences, enhance brand visibility, drive web traffic, generate leads, and attain business objectives. Grasping the evolving essence of marketing and staying attuned to the latest trends equips asset managers to deftly navigate the dynamic market landscape and enhance their marketing initiatives moving forward.
Understanding Marketing in 2024
The Evolution of Marketing
Marketing practices have drastically changed over the past few decades with the shift from traditional (outbound) to digital (inbound). What started as a simple exchange process of goods and services, evolved into sales-oriented strategies and then shifted focus to client satisfaction. In the early 20th century, marketing was largely about distribution and sales. The concept of building relationships with customers didn't emerge until the 1950s. With the advent of the internet in the '90s, the focus shifted to online marketing, which eventually developed into the diverse digital marketing field we know today.
The evolution of marketing is a continuous process, adapting to the changing environment and consumer behavior.
It's not just about selling products or services anymore; it's about providing value to the client, building a brand image, and creating a lasting relationship with the client.
As we head into 2024, it's crucial for asset managers to understand how marketing has changed over the years to effectively utilize the most effective marketing tools and strategies available in 2024.
Traditional Marketing: What Has Changed?
Traditional marketing, which once the only type of marketing offered, has undergone significant changes. In the past, marketing was largely a one-way street where firms would broadcast their messages to clients through mediums like print, television, radio, and billboard ads. Over time, these traditional campaigns became more targeted but digitalization has fundamentally altered how we approach marketing. Today, investors have access to an array of information at their fingertips, making them savvier and more demanding. They no longer passively receive marketing messages; instead, they actively seek out information and rely on their own research when making purchase decisions. As a result, the effectiveness of traditional advertising techniques has diminished. That's not to say traditional marketing is obsolete. It can still play a role in a comprehensive marketing strategy. However, firms can no longer rely solely on these methods to reach their audience.
Digital Marketing: Keeping Pace with Innovation
In contrast to traditional marketing, digital marketing has been shaped by rapid advancements in technology thanks to the rise of the internet in the early 90’s. This shift has resulted in a more interactive, personalized, and data-driven approach to reaching investors. These days firms can leverage a multitude of digital channels to target their audience more precisely than ever before. Whether through social media, search engine optimization (SEO), influencer collaborations, or content marketing, firms can now meet clients where they spend most of their time: online. However, as the digital landscape continues to evolve, so too must our marketing efforts. With the rise of artificial intelligence, augmented reality, and voice search, staying ahead of the digital marketing curve is no longer an option but a necessity. These innovations offer more cost effective ways to engage investors, drive brand visibility, and achieve business goals. Keeping pace with these digital innovations will be the key to maintaining a competitive edge.
Dissecting Traditional and Digital Marketing
Decoding Traditional Marketing Techniques
Traditional (outbound) marketing techniques, though overshadowed by digital methods, still have a place in some marketing toolboxes. These techniques primarily include advertising and in-person events. These methods are often broad and indiscriminate, reaching a wide audience but lacking the precision targeting of digital marketing. Print advertising, one of the oldest marketing techniques, includes newspaper ads, magazine ads, brochures, and flyers. Direct mail involves sending promotional materials directly to potential customers. Television and radio commercials, while expensive, can reach a large audience. Outdoor advertising, like billboards and transit ads, are used to capture the attention of people in specific locations. These traditional methods can still be effective, particularly for local businesses or when used in conjunction with digital marketing techniques.
Strategies of Modern Digital Marketing: SEO to Retargeting
Digital (inbound) marketing strategies have revolutionized the way firms reach and engage with their target audiences. Search Engine Optimization (SEO) is a key strategy that involves optimizing a website's content and structure to improve its visibility on search engine results pages. Content marketing, another essential technique, involves creating and sharing valuable content to attract and engage with investors. Social media marketing leverages platforms like Facebook, Instagram, LinkedIn, and X to build brand awareness, generate leads, and drive engagement. Email marketing involves sending targeted, personalized messages to a company's email subscribers. Pay-Per-Click (PPC) advertising allows businesses to display ads on search engines and only pay when a user clicks on the ad. Similarly, affiliate marketing involves promoting a company's products or services through affiliates who earn a commission for every sale or lead they generate. Influencer marketing leverages the reach and influence of popular individuals on social media to promote a brand or product.
Interplay of Traditional and Digital Marketing
Necessity of a Hybrid Marketing Approach
Relying solely on either traditional or digital marketing techniques is no longer effective. A hybrid approach is necessary to reach clients at every stage of their buying journey. This approach combines the broad reach of traditional marketing methods with the targeted, interactive nature of digital. With mixed marketing campaigns, firms can leverage the strengths of each method to create a more effective, comprehensive marketing strategy. For instance, a television ad (traditional) could raise brand awareness among a broad audience, while a targeted social media campaign (digital) could engage a narrower, more specific audience.
Similarly, a billboard ad could drive consumers to a company's website after doing their own research based on what the ad showcased, where digital techniques like SEO and content marketing come into play. Finding a balance between these two marketing paths allows firms to reach clients across multiple touch points, reinforcing brand messages and improving the chances of conversion. Utilizing both traditional and digital strategies will be needed if you want to maximize the effectiveness of your marketing outreach.
Determining the Right Marketing Mix
Determining the right mix of traditional and digital marketing techniques depends largely on your business goals, target audience, and resources. This requires a deep understanding of your audience's behavior, preferences, and needs. For instance, a younger audience might be more responsive to digital marketing techniques, while an older demographic might still respond well to traditional methods. It's also important to consider your business goals. If your aim is to raise brand awareness, broad-based traditional advertising might be effective. On the other hand, if you're focused on lead generation or customer engagement, digital techniques could be more suitable. Your resources also play a crucial role.
Digital marketing often requires less financial investment but more time and expertise, while traditional marketing can be more costly but less time-intensive.
Testing, analyzing, and refining your strategies is essential to determining the right mix. By carefully balancing traditional and digital marketing strategies, firms can create a comprehensive, effective marketing mix that drives success.
The journey from the simplicity of product exchange to today's emphasis on investor value and relationship-building reflects a continuous evolution. Traditional marketing, once the reigning monarch, has transformed alongside the rise of digital techniques, ushering in a new era of precision and interactivity. Yet, the wisdom lies in recognizing the complementary strengths of both realms. A hybrid approach, skillfully blending the wide reach of traditional methods with the targeted finesse of digital strategies, emerges as the key to a comprehensive marketing strategy. As firms navigate the complexities of marketing, understanding the audience, aligning with business goals, and judiciously allocating resources will determine the perfect marketing mix.
Related: Understanding Your Target Market: Messaging Questions for Asset Managers