In the world of eCommerce, staying ahead of the competition requires strategic and effective marketing efforts. As we delve into 2023, it’s essential to understand how eCommerce brands are allocating their marketing budgets. In this blog, let’s explore the trends and strategies shaping the marketing landscape for small-to-medium businesses (SMBs) and mid-market enterprises.
The shift towards customer acquisition
A prominent trend in marketing spending for SMBs is the focus on customer acquisition rather than retention. While customer retention is super important for long-term success, SMBs often prioritize expanding their customer base. In 2023, mid-market businesses are expected to lead the pack in marketing expenditures. Klaviyo, a marketing automation company, suggests that a significant portion of these businesses are likely to spend $1 million or more per month on marketing initiatives. This demonstrates their commitment to major growth and their recognition of the importance of robust marketing campaigns in achieving that goal.
On the other hand, SMBs are projected to spend between $301,000 and $400,000 per month. This represents a nearly 10% increase year over year in the number of businesses willing to invest in this bracket. It underscores the growing understanding among SMBs of the need to invest in marketing to stay competitive and drive business growth.
What are the most popular marketing channels?
Now, let’s take a closer look at the most popular marketing channels utilized by eCommerce brands. According to Klaviyo, the top five channels include email, organic social, paid social, SEO, and content marketing. These channels all offer unique advantages in reaching and engaging target audiences effectively. Email marketing, in particular, stands out as a high-ROI channel for eCommerce brands. A whopping 76.86% of all businesses consider email marketing as one of the top three channels for generating return on investment. The ability to tailor messages to individual preferences and behaviors makes email an invaluable tool for driving customer engagement and conversion.
As we just mentioned, following email, other channels that generate significant ROI include paid search, paid social, broadcast, and SEO. These channels offer a mix of paid and organic strategies, enabling brands to reach wider audiences, increase visibility, and drive conversions.
Let’s summarize the key findings.
SMBs prioritize customer acquisition over retention in their marketing budgets. Mid-market businesses are leading in marketing expenditures, with a focus on aggressive growth. SMBs are increasingly investing between $301,000 and $400,000 per month on marketing. The most popular marketing channels for eCommerce brands include email, organic social, paid social, SEO, and content marketing. Email marketing delivers the best ROI, with 76.86% of businesses ranking it in their top three ROI-generating channels. As eCommerce continues to evolve, marketing strategies must adapt to meet the changing needs of customers. By understanding these trends and allocating resources strategically, eCommerce brands can position themselves for success in 2023 and beyond.