Top Marketing Predictions for 2020 Reveal Risks of Influencers and Personalization

December 19, 2019
Contributor: Laura Starita

Changing attitudes about influencers and the potential for real personalization are among the Gartner top 2020 predictions for marketing leaders.

Marketers are always on the lookout for new opportunities to engage directly with their customers and create experiences that are as close to one-on-one as possible. Influencer marketing and personalization are among the high-profile initiatives they’ve pursued toward that end in recent years. Yet consumer trends point to a loss of trust in large institutions, as well as rising concerns about data privacy. These issues will force marketers to proceed with care as they continue to leverage technology to facilitate proximity to their customers.

“Marketers strive to engage prospects and customers on an intimate, personal level.”

“Marketers strive to engage prospects and customers on an intimate, personal level,” says Charles Golvin, Senior Director Analyst, Gartner. “The mantra of one-to-one marketing was born of this goal, but it’s getting harder now that consumers have developed a jaundiced eye toward marketers.”

A changing approach to influencer marketing and renewed scrutiny of the value of personalization are among the top five Gartner 2020 predictions for marketing leaders.

Consumers choose experience over influence

By 2023, CMO budget allocation on influencer marketing will decrease by a third as consumers continue to lose trust in brands and entities they don’t personally know.

Consumer trust in large, abstract entities like “government” or “corporate America” has taken a nosedive in recent years, particularly among millennials. Influencers appear to be caught up in this trend, their downward spiral accelerated by influencers who express racist views, promote poor-quality products or misrepresent themselves. Consumers are turning instead to family, friends and local businesses to provide product advice and commercial service.

For marketers, the erosion of trust is just the latest knock against influencers. Marketing leaders already struggled to find relevant influencer partners and measure the marketing impact of those relationships. Brands in the fashion, cosmetics and gaming industries also need to manage the reputational risks that arise when influencers express views or behave in ways that are counter to the brand — a common occurrence for people whose continued relevance depends on spectacle. In response, marketers are deemphasizing influencers in their marketing strategies.

Influencer marketing is not likely to disappear entirely, however. Instead, marketers are shifting their strategies to focus on small-scale influencers with 25K or fewer followers. These influencers have more engaged audiences and they post more often, creating a personal, focused persona that mimics the experience consumers have with providers in their communities.

Personalization faces a performance deadline

By 2025, 80% of marketers who have invested in personalization will abandon their efforts due to lack of ROI, the perils of customer data management or both.

Fourteen percent of the total marketing budget is now dedicated to the pursuit of personalization. That’s no surprise, given the long-held goal marketers have of creating one-to-one customer engagement. Technology plays a big role in these initiatives, absorbing 44% of personalization spending.

High budgets come with high expectations of business value, yet the returns on personalization remain hard to quantify for marketers. About half of all personalization engines are used for digital commerce use cases, which enable leaders to measure impact through sales. Marketing and customer experience applications make up the other half of personalization engine use cases, however. These initiatives rely on metrics such as Net Promoter Scores and customer satisfaction rates, which have only indirect connections to business value. Without demonstrable ROI from these efforts, marketers will eventually lose support for them.

It is time to retrench and go back to basics. Only 40% of marketers report that they have a clear personalization strategy and roadmap, so start there to develop a strategy and identify high-potential use cases. Go back one or two levels to test tailored recommendations for segments and analyze customer journey maps to identify high-value moments where a more personalized experience could deliver value.

Learn more about CMO predicts for 2020 in the complimentary Gartner Top Marketing Predictions 2020: Balancing Trust With Insights   by Charles Golvin. 

You may also be interested in
“I use Gartner to bolster my confidence in decision making.”

Stay smarter.