Diana Marszalek 05 Dec 2023 // 11:00PM GMT
After a rough 12 months, growth companies are preparing for international expansion in 2024 despite economies in some parts of the world — including the US and UK — expected to slow, according to new research from VCCP tech agency group Outleap.
The survey of more than 200 CCOs, CMOs and CEOS found that while most respondents (79%) at companies that have raised more than $100 million said macroeconomic factors are inhibiting growth, 44% said their companies are looking to expand in the next 12 months.
“It’s clear that brands and marketers can’t wait for macroeconomic factors to stabilize before they act on their global ambitions,” said Outleap chairman and Method Communications CEO David Parkinson.
Growth, however, will be markedly than it has been over most of the last decade, during which companies saw unparalleled injection of cash, the study found.
Given higher interest rates, threats of recession and a slowdown of the IPO market (which in the last year or so has brought much investment to a halt) companies are expected to take a more cautious approach to expansion. Doing that includes measured and disciplined management of costs, headcount and marketing, according to Outleap, which in addition to Method includes Harvard and Sling & Stone.
Half of comms and marketing leaders said their companies are emphasizing profitability more than they have in the past. In addition, 60% said their budgets are higher now than a year ago.
“It certainly seems the only constant is change. The last few years have been a challenge to say the least, but we now know that companies wanting to expand internationally can’t wait on the sidelines for things to stabilize,” said Parkinson. “The world is complex and it will stay that way for a long time.”
Today, more than two in five (44%) of comms leaders are directly involved in business strategy. However, more than half (51%) are still developing reactive communications recommendations based on existing business strategy. This shows there is a significant opportunity for many communications leaders to take a more active role, especially when it comes to overseas expansions, Outleap said.
The survey also found that the shift toward performance marketing over the past two years is starting to reverse, with CMOs and CCOs reporting a focus on a 41/59% split between brand/comms and performance marketing. Those with more than $100 million in funding find brand marketing and comms the biggest growth driver for their businesses.
Measuring the impact of PR is still a point of contention as there is a significant gap between how CEOs and communications/marketing leaders perceive the most effective methods for measuring marketing campaign success.
The study found 90% of CEOs express confidence in their ability to accurately measure the impact of PR and marketing on profitability, sales and brand recognition. However, only 69% of CCO and CMOs and 72% of other communications and marketing leaders share that confidence.