When inflation is high the cost of living rises and wages, although rising too, never quite keep up. This has an impact on our pockets. But in addition to the economic consquences of inflation, there are subtler cultural consequences too. That’s something marketers need to understand.

Kate Muhl, a consumer insights expert and VP, analyst at Gartner, shared this insight. “It’s important to think about the idea that there’s more happening with inflation than just economic impact and consumer spending. Those effects start to fade. We’re not where we were a year ago — but lots of consumer attitudes and behaviors are still ripple effects out of that initial inflationary moment.”

What the research shows. The 2023 Gartner Cost-of-Living and Price Sentiment survey revealed the following:

• A third of households reported financial hardship due to price increases with the most impact felt by low and low-to-middle income households.
• 38% of respondents reported cutting their discretionary income (a YoY increase of 15% on 2022).
• More than a third have increased spending on store brands and increased their use of coupons.
• Over 40% report switching to generic brands, store brands and less expensive products in at least one product category.
• 57% reported postponing a milestone event (such as a wedding or vacation) due to cost-of-living pressures.

Against this background, consumers and marketers are divided on what responses are appropriate. CMO priorities include increasing the availability of a product or service, offering special deals and increasing rewards and benefits. Customers agree on the special deals, but their other priorities are keeping prices steady and, interestingly, not seeing high-level executives get pay raises.

In Muhl’s view, this reflects a growing sense, especially among younger consumers, that the system is “rigged” in favor of the wealthy. “A lot of this is about consumer sentiment, culture,” said Muhl. “How does it feel? What are people’s prevailing opinions about how the world is working? Those things matter to brands.”

This doesn’t mean marketers should blindly switch to their customers’ priorities. “Consumers are consumers,” said Muhl. “Our job is to be marketers, but as marketers we have to realize that this disconnect exists and use the tools available to us to try to close that gap.”

Grab tiefer: Breaking down the digital transformation of today’s customer journeys

The right responses. This would be a good time, Muhl believes, to prioritize narratives that speak to thrift and savings and to focus on those brand values most relevant to your customers’ experience of inflationary pressures.

As examples of responsive narratives, Mulh offered Tide’s “Cold Hard Savings” campaign and Everlane’s “Priced Like It’s 2019.”

“This is just not the time to get into luxury positionings (with some exceptions) — luxury for its own sake rather than premium or quality,” Muhl said. “Brands need to really think about what their core values are and act from those where appropriate.”

Warum es uns interessiert. The past three years should have taught us that our sentiments, our culture, does not necessary align precisely with real world events. For many of us, deeply felt emotional reactions to a global pandemic did not necessarily coincide with COVID-19’s real-time impact. As the pandemic receded, pandemic-induced behaviors persisted — as did anxiety and uncertainty.

Similarly with inflation. Positive economic indicators and a slow but steady decline in inflation has not relieved foreboding about a recession. Inflation-triggered behaviors and attitudes will not automatically dissipate as inflation recedes to a tolerable level. Marketers need to be aware, sensitive and, as always, transparent in responding to consumer sentiment.

After the conclusion of Google I/O 2023, the stage was set for Google Marketing Live 2023, which brought a global hybrid experience to brands and advertisers. In-person viewing events were organized across different locations worldwide, allowing participants to convene locally, while virtual attendees from all corners of the globe tuned in to watch the livestream.

The immersive event serves as a catalyst for empowering marketers with the latest tools, strategies, and best practices – covering a wide range of topics from generative AI to new campaign goals. Attendees (including Tinuiti’s own expert team) scored a front row seat to valuable marketing insights across Google’s expansive advertising ecosystem.
 

AI Takes Center Stage at #GML2023

 
It goes without saying that AI capabilities took the center stage at Google Marketing Live 2023 with a variety of notable product announcements including:
 

• Conversational AI Campaign Creation: Exciting developments are taking place in the realm of campaign creation, with a shift towards leveraging conversational AI. This advancement offers advertisers a potent tool to enhance their audience engagement and foster more effective communication.

• AI-Powered Asset Targeting: Google Ads introduces AI-powered assets, supported by the existing AI-powered campaigns, that precisely target search queries, empowering advertisers to deliver more relevant and personalized content to their target audience.

• AI-Generated Images with Google Product Studio: Through Google Product Studio, advertisers gain access to AI-generated images, revolutionizing the way they visually represent their products and drive engagement.

 
These advancements highlight Google’s commitment to harnessing the potential of AI and delivering innovative solutions to enhance advertisers’ marketing efforts.

However, aside from AI, what are some of the other announcements that stood out?

This week, we spoke with our internal experts at Tinuiti to find out what they deemed as the most valuable takeaways at #GML2023. Let’s dive in!

Google Performance Max: 6 Standout Upgrades for Marketers

 
Google Performance Max campaigns are goal-based, automated campaigns that enable advertisers to promote across all Google networks from the same campaign. Google announced Performance Max campaigns in October 2020 as “a new way to buy Google ads across all our inventory.” 

Performance Max—or PMax, for short—is designed as a complement to your existing keyword-based Search, Shopping and fully-automated campaigns, building on learnings from the latter “to deliver a comprehensive solution that works for all advertisers across a wider range of marketing objectives.”

Per the updates shared during GML 2023, the latest features within Performance Max that we are most excited about include:

• New customer acquisition with high value optimization goal in Google Ads
• Access to re-engagement goal for improved retention
• Test and learn opportunities with custom experiments
• Improved insights to better understand performance
• New features within the Ads Creative Studio
• Generative AI to create text assets and images

“These changes create additional ways to leverage Performance Max and make it an even more flexible marketing tool, capable of optimizing towards impactful business objectives. These updates also further solidify the need for advertisers to have robust first-party data / Customer Match infrastructure and execution capabilities.”

– Josh Brisco, Group Vice President, Acquisition Media at Tinuiti

1. New Customer Acquisition with High Value Optimization Goals in Google Ads

 
What is it? The existing New Customer Acquisition (NCA) works by using first-party data lists to analyze users’ characteristics and then implements the power of AI to predict and find new high value users. This new iteration will allow advertisers to specifically target users who are predicted to have high lifetime values.

How will it benefit marketers? NCA allows marketers to optimize for the highest value new customers, in addition to maximizing their bottom line sales. Overall, this feature (along with many others released at GML 2023) provide marketers with new ways to leverage Performance Max to execute specific business outcomes.

According to Google, NCA leverages data from a variety of sources include customer lists, global site tags Und auto detection to:

• Grow overall revenue but optimize for conversions from new customers because new customers bring long term revenue to the business.
• Grow market share with a dedicated budget for customer acquisition either maximizing the number of new customer conversions with a Customer Acquisition Cost (CAC) or maximizing the revenue from new customers to also meet near term return of investment (ROI).

“As we look to leverage an audience-first approach to Performance Max, advanced functionality as it relates to NCA is an exciting addition. This will allow us to not only focus on new customers, but focus on new customers who can drive the highest value”.

– Evan Kirkpatrick, VP, Shoppable Media at Tinuiti

2. Access to Re-Engagement Goal for Improved Retention

 
What is it? Google’s re-engagement goal allows marketers to optimize their campaigns to reach customers at every decision-making point in their lifecycle journey. In addition to new customer acquisition, marketers can use re-engagement goals to optimize for other lifecycle stages, like retention and re-engagement of churned customers.

How will it benefit marketers? Google’s re-engagement goal allows marketers to bid more effectively to re-engage lapsed customers, report conversions from lapsed customers directly in the Google Ads UI.

“I’m most excited about the potential for customer reactivation Und lifetime extension. Our job as marketers is not over when the customer comes in the door. As the saying goes, it’s cheaper to keep an existing customer than to get a new one.”

– Aaron Levy, VP, Paid Search at Tinuiti

3. Test and Learn Opportunities With Custom Experiments

 
What is it? Performance Max Custom Experiments will let you test changes within your Performance Max campaign. This feature helps you A/B test different features, settings, and campaigns to drive improvement. For example, you can test if using a value based bidding strategy for your campaign drives more results for your business.

How will it benefit marketers? When you test different campaign settings, you reach more customers and drive better results quickly and efficiently for your business. You can also use experiments to help you measure the incremental lift of using Performance Max campaigns.

“This will provide an improved way to measure the efficacy of your current Performance Max structures as well as potential improved strategies overall.”

– Josh Brisco, Group Vice President, Acquisition Media at Tinuiti

4. Improved Insights to Better Understand Performance

 
What is it? According to Google, new insights will highlight additional data on your assets to help marketers better understand their campaign performance. You’ll also get easy-to-apply recommendations on how to improve your assets. 

Additionally, search term insights will now include historic insights and insights for custom date ranges. You’ll also be able to download your Search term insights and access them in the Google Ads API. You’ll be able to see all your Search term categories now, instead of having some listed as uncategorized.

How will it benefit marketers? Google’s improved insights will provide information on which assets are or are not resonating with a given audience, provide potential suggestions on better creative, and will call out any missing asset types.

“The more data we can get from the black box, the better. These changes should help inform advertisers how optimize their PMax campaigns for maximum effect” – Josh Brisco, Group Vice President, Acquisition Media at Tinuiti

“We’re cautiously excited about this one. Performance Max has a ton of potential as a research testing ground. Ultimately, the more insights we can get access to, the more we can use that data to amplify additional marketing efforts.” – Aaron Levy, VP, Paid Search at Tinuiti
 

5. New Features Within the Ads Creative Studio

 
What is it? Ads Creative Studio is a creative management platform designed for creative teams to build ads, manage creative assets, and share them with media teams. Ads Creative Studio can improve collaboration and transparency between your creative and media teams and help you create effective ads with more efficiency and scale.

How will it benefit marketers? Thanks to the preview and export feature, marketers will be able to see best practices and specifications to ensure that creative is set up for success ahead of deployment. New insights in Ads Creative Studio will also provide information about trends within Search. This supplementary tool will give marketers exploratory access to the latest and greatest Search data to help plan and develop future creative.
 

6. Generative AI To Create Compelling Text Assets and Images

 
What is it? With the revamped asset creation flow in Performance Max campaigns, marketers can harness the power of Google AI to curate and generate high-quality text and image assets.

According to Google, this Generative AI feature can easily create compelling creative assets to be implemented in Performance Max campaigns. 

Here’s a closer look on how it works:

Credit: Google

How will it benefit marketers? Setting up Performance Max campaigns can feel overwhelming due to the necessary content and imagery. The inclusion of a helpful feature that provides assistance and even generates new creative is a valuable addition, guaranteed to save advertisers precious time and resources. Adding a diverse range of assets and keeping them fresh over time can help improve results by maximizing the eligibility to serve on a full range of ad inventory.

“AI Generating Performance Max is an exciting new feature that can boost our creativity and give us new opportunities to develop effective PMax campaigns. Based on our findings, brands that include the suggested 20 image ads and 5 videos per asset category see a +10% boost in conversions. So this functionality can be useful for brands that are having trouble reaching the recommended levels.”

– Courtney O’Donnell, Senior Director, Shoppable Media at Tinuiti

“Visual creative has long been a neglected part of the SEM ecosystem; this new tool will enable advertisers to test far more iterations of creative while greatly reducing the burden on creative teams.”

– Aaron Levy, VP, Paid Search at Tinuiti

Google Ads Campaign Types: Introducing Video Views and Demand Generation

7. Video View Campaigns

 
What is it? Video View Campaigns are designed to maximize views. According to Google, a study revealed that advertisers using Video View Campaigns experienced an average of 40% more views at comparable costs compared to in-stream skippable CPV campaigns.

How will it benefit marketers? These campaigns leverage a range of formats, including skippable in-stream ads, in-feed ads, and Shorts ads, to optimize budget allocation and achieve optimal results. Video Views can also combine 3 formats in a single campaign for a single goal.
 

8. Demand Generation Campaigns

 
What is it? Demand Generation campaigns leverage AI to engage and drive action with consumers. These campaigns work across a variety of placements including YouTube in-feed, YouTube Shorts, YouTube in-stream, Discovery Feed and Gmail. 

How will it benefit marketers? At Tinuiti, we are eagerly awaiting more info on Demand Generation campaigns, but it seems like this feature has great potential to help advertisers more readily access the mid and upper funnel inventory that Google has to offer.

“We’re interested to see if this will be similar to Performance Max in that it will be used in addition to existing campaign types not instead of. Or, will it replace much of how we buy YouTube today?”

– Courtney O’Donnell, Senior Director, Shoppable Media at Tinuiti

We expect more details will be shared on this specific campaign type at Cannes 2023. 

“As we continue to see the evolution of AI driven campaigns across various inventory types, having an audience-first approach and strong creative to match are going to be keys for success in driving action from the consumers.”

– Brian Binder, Senior Director, Programmatic at Tinuiti

Additional Noteworthy GML 2023 Announcements

9. Google Search Generative Experience (SGE) Integration With Search, Shopping

 
What is it? Google is currently conducting experiments to seamlessly integrate Search and Shopping ads directly into the AI snapshot and conversational mode. SGE has the opportunity to create customized ad experiences (across Search and Shopping) that align with the user journey.

While Google has not disclosed specific metrics like CTR for these SGE (Search, Shopping, and Google Express) ads due to their experimental nature, they offer immense potential. It’s important to note that since this feature is still in its early stages, there is currently no option to opt in or out of ads appearing in SGE.

How will it benefit marketers? Google’s AI integration with Search and Shopping provides marketers with an opportunity to drive more engagement and visibility of their ads. The new Search Generative Experience (SGE) can be found in Search Labs, a new program to access early experiments in Search. Ads that show up as a part of this experiment will be from existing Google Ads campaigns.

Want to give generative AI in Search a try? Tap the “Labs” icon in the Google app or Chrome desktop to express your interest, and visit labs.google.com/search to learn more.

“SGE represents the long awaited manifestation of conversational search and ads on Google’s results page. It will be interesting to see the ways in which this impact how we buy Google Ads”

– Josh Brisco, Group Vice President, Acquisition Media at Tinuiti