Marketing Dojo #76: 🚀 Don't Miss This Reddit Moment 💎
A rare growth opportunity, YouTube takes on TikTok Shop, Gen Z's Say-Do Gap and more.
Hello Everyone,
안녕하세요 (Annyeonghaseyo)!
Work's whisked me off to Korea this week. While my schedule's packed tighter than kimchi in a jar, I'm squeezing in time to learn a phrase or two.
A friend once told me she learned Korean by binge-watching K-dramas.
I am learning Mandarin over the weekends. This visit to Korea made me think: why not turbocharge my weekend Mandarin lessons? If you've got any binge-worthy Chinese drama recommendations, send them my way!
I am reading a mind-opening book which has me glued. If you are short on time, scroll down to the P.S section and add this gem to your reading list.
Not in a rush? Buckle up for some marketing goodness. In this issue of Marketing Dojo, we're diving into:
🚀 Thank Reddit for the traffic
💸 Yes, marketing budgets are shrinking
🌿 The price premium on sustainability
🏆 YouTube is catching on to a trend
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The Unexpected Reddit Goldmine for Savvy Marketers
News publishers have had a rough few years, so seeing them catch a break is refreshing. Even better, their success allows marketers to boost their brand's visibility.
Have you noticed Reddit creeping into the top spots on Google searches? It's not your imagination. I recently searched for a vegetarian restaurant for a friend, and the first non-sponsored result was a Reddit discussion forum.
So, what's driving this change? Two reasons
Google's Algorithmic Shift: Google's recent updates have prioritized user-generated content (UGC), aligning with its commitment to promoting content that scores high on Experience, Expertise, Authoritativeness, and Trustworthiness (EEAT).
Reddit and Google's Partnership: Reddit and Google have inked an exclusive deal, valued at around $60 million annually. This partnership grants Google access to Reddit's massive UGC repository, helping improve search functionalities and train AI models.
Sensing an opportunity, news publishers are jumping on board. Some, like The New York Times Opinion, have opened new Reddit accounts, while others, like Newsweek, are dusting off their old, inactive accounts.
To give you a sense of how impactful this is, according to data from Ahrefs and Semrush, Reddit's organic traffic has skyrocketed sevenfold in the last nine months. At The Washington Post, Reddit traffic has surpassed Instagram traffic on occasion—something unthinkable just a year ago.
For almost a decade, news outlets thrived on Facebook traffic, but as that relationship soured, so did their organic reach.
Reddit's newfound prominence on Google offers a rare, organic lifeline.
Here's the takeaway for brands: When budgets are tight and organic opportunities scarce, why not take a page from the publishers' playbook? Give Reddit a shot - you might just find your next traffic goldmine!
Memetime: YouTube’s Catching On To A Trend.
Social commerce, A.K.A discovery-based shopping, is taking off and how. TikTok Shop has an undisputed lead in this segment. In 2023, the TikTok shop grew its Gross Merchandise Revenue four-fold to $16Bn annually.
It has maintained its momentum in 2024 and is closing in on Shopee - the eCommerce leader in SouthEast Asia.
TikTok's success isn't a fluke. It's the result of a long game that started in Indonesia. Their strategy?
Boots on the ground: TikTok invested in local teams to recruit businesses.
They hired agencies to help small businesses create TikToks.
Rinse and repeat: This winning formula was replicated worldwide.
The result? As of 2023, 500,000 merchants were selling on the US TikTok Shop alone.
This kind of moat is tough to overcome, which is why YouTube's partnership expansion with Shopify is a smart move. YouTube's current shopping affiliate program allows creators to earn money through their videos while helping their audience discover new products. With Shopify merchants now able to join YouTube's affiliate program, YouTube creators will have access to an even broader range of brands to tag in their videos.
A win-win for both platforms.
The Big Marketing Squeeze.
In 2024, marketers are truly being asked to do more with less. Gartner's CMO quarterly report paints a sobering picture of just how tight things have become:
Marketing budgets have shrunk to 7.7% of overall company revenue, down from 9.1% in 2023.
The four-year average spend in marketing has plummeted from 11% pre-pandemic to 8.2% post-pandemic.
Meanwhile, 55% of CEOs expect higher returns on marketing investments.
The marketing community's response? It's a mix of stress and short-termism:
Visible Stress: 64% of CMOs reported feeling under-resourced and struggling to execute their strategies effectively within the new budget constraints.
Rampant Short-Termism: Investment in paid media has risen to 27.9% of marketing budgets, while spending on marketing technology, staff, and agency partners has declined. My hunch? A big chunk of this is going to performance marketing for short-term results.
I've often wondered if the squeeze I've been feeling is an isolated experience. But if Gartner's CMO Report is anything to go by, it seems the entire marketing community is navigating these challenging times.
Gen Z’s Heart-Wallet Gap.
Gen Z is a vocal generation. As they enter the workforce and flex their spending muscles, they're becoming a critical target for marketers. The SpendZ Report from Nielsen offers a fascinating glimpse into the emerging trends of this new dominant cohort.
One data point that caught my eye? The glaring say-do gap when it comes to sustainability:
77% of Gen Z respondents claim they avoid purchasing from countries with poor environmental practices. Yet, fast fashion brands with questionable supply chains are booming.
Adding to this paradox, the report shows quality, discounts, and price far outweigh sustainability, local sourcing, and responsible practices as purchase drivers
But before we write off Gen Z's eco-conscience, two other insights offer a nuanced view:
The 10% Premium: Gen Z is willing to pay about 10% more for sustainable brands.
The Power of Stacking: Products with multiple sustainability claims (e.g., "carbon zero" and "recycled materials") saw a 2.5 times higher sales lift than those with just one attribute.
This say-do gap isn't unique to Gen Z. Brands are learning the hard way that it's tough to compete with the instant gratification of cheap, fast products.
However, Gen Z's passionate stance on environmental issues sets them apart. Gen Z's hearts are in the right place, but their wallets haven't quite caught up... yet. As they mature and their spending power grows, the premium for sustainable brands might well expand.
For now, what's a brand to do?
· Don't overinvest
· Stack sustainability attributes where possible
· Keep expectations realistic
That’s a wrap on this week. Thank you for your time and attention. If you liked this week’s newsletter or found something interesting, please give me a like ❤️ or drop a comment🗨️. Your support helps drive the newsletter's discoverability.
Regards,
Garima Mamgain
P.S:
I work 100% remote. As an introvert, I love being freed from the pressure of small talk. But some days, I crave a change of scenery. Last week, I camped out at a public library. After 4 hours of deep work - I strolled around the shelves.
Purely out of chance, I picked up this book with an intriguing title.
And I have never been so hooked before. The book is a compendium of short essays on underrated ideas. I have never been so mind-blown.
I'm reading it randomly - opening to a page, diving into an idea, then pondering its applications beyond its original context. Some concepts that have stuck with me (so far) are exaptation, Fermi problems, and the illusion of explanatory depth (IOED).
If you are a curious soul ( I know you are), give this book a shot. You will love it.
This book looks interesting. Adding it to my to-read list!