Digital commerce and marketing have become even more intertwined and both will need to work more closely than ever to create a complete online shopping experience as more and more companies bring digital agency capabilities in-house.
With the immense amount of data available on online consumer behavior and purchasing habits, it’s now easier for in-house teams to target these consumers with relevant marketing campaigns and promotions, driving them directly to ecommerce stores to not only interact and engage, but also transact.
The Digital Agency Shift
In-house digital agencies are booming right now, as many external agencies are being replaced. According to a research report by the Society of Digital Agencies, the number of companies that no longer work with external agencies increased 108% from 2014 to 2015. With in-house digital capabilities, brands can better manage the development of marketing communications and make adjustments in a matter of hours rather than days or weeks.
Brands that still outsource marketing to digital agencies are now reducing the number of partners they work with. This is evident since the percentage of brands that work with four or more digital agencies have decreased by 43% from 2014 to 2015. Today, only 12% of brands work with four or more digital agencies. By consolidating agencies, companies can function more efficiently and adapt to the growing changes of the modern day digital era’s dynamic competitive environment.
An Ever-Changing Market
Part of the new trend away from external agencies is due to the fast-paced nature of the digital landscape; it requires the ability to adapt and respond quickly. According to Demandware, digital commerce is growing at a YoY pace of 23%. More importantly, the industry is evolving quickly. With the recent surge in new commerce channels and platforms such as social shopping buttons and purchase-enabled wearables, online shopping is becoming more transformative and spontaneous every day. Companies need responsive digital marketing teams to quickly integrate these new channels in order to avoid missing out on potentially lucrative opportunities that competitors may already be aware of.
Direct-to-consumer digital commerce channels are now necessities for brands across nearly every industry. In order to leverage the benefit of these channels, companies must create coordinated marketing campaigns that drive consumers in. With digital commerce and marketing working hand in hand, brands are now able to deliver seamless shopping experiences that accurately capture the brand’s voice and identity throughout the entire consumer journey.
And while digital commerce has opened a wealth of new opportunities, it has actually become more complex. In today’s multi-channel digital environment, the opportunities for buying are endless. Staying aware of these new developments and being able to quickly setup and service these channels is key, which makes it even more important for digital agencies to closely integrate themselves with the brand team. This way, they will be able to respond to the company’s changing needs with better industry and product acumen.
More Creative Control
With the massive amount of information available on the internet nowadays, brands tend to believe that they understand their customers better than their agencies do, which makes them crave more control over the marketing team’s creative process. This whole process is made easier when one has the continuity. One example of this is the Red Bull Media House, which serves as a media portal through which marketing content is continually produced and disseminated to the Red Bull audience through their own internal team.
Less Approvals, More Efficiency
When companies bring digital teams closer, they also reduce the problems that occur when working with multiple agencies, where the process of working back and forth is too slow and fragmented. Even with one agency there are too many approvals to be made before the finalized product reaches the client. Multiply this by the number of agencies a company works with and it’s evident that the time and effort it takes to get through these approvals can quickly turn into a cumbersome process. Slow reactions are unacceptable when dealing with today’s lightning-fast digital space, so having an efficient end-to-end solution that quickly delivers hard results is the ideal organizational structure.
Enabling the Full Cycle
The end-to-end tactic is more important than ever, and companies can no longer work with agencies that only focus on the initial engagement. The close is just as crucial, if not more. Brands must have continuity in their consumer journey, completing the full cycle of discovery, engagement, transaction and fulfillment. Owning the entire journey is the best way to ensure complete fluidity. Furthermore, agencies are often recognized and chosen for creating award-winning work, yet it is important for brands to realize that this does not always translate into sales.
The convergence of digital commerce and marketing requires thought on how organizations are structured. As more and more companies bring external digital agency capabilities in-house, the speed and pressure within the competitive digital field will also increase. Both digital commerce and marketing teams must be structured in a way that enables the ability to respond efficiently to a rapidly evolving digital marketplace.
Richard Magalik is Executive Creative Director for BrandShop