With over 60% of UK and US consumers now discovering brands online, technology has clearly changed the way companies engage with their customers. Clare Gordon, a partner with Bain's Consumer Products practice, identifies five areas that CMOs should examine when transforming their marketing strategies to increase profitable growth.
Read the Bain Brief: The Future of Marketing in Consumer Products
Read the transcript below.
CLARE GORDON: Consumer products marketing has experienced a profound change over the last 5 to 10 years, from a world dominated by large global brands and established TV and big-box retail models to a world that's quickly much more complex, with a proliferation of brands, channels and marketing tools.
Technology's disrupted the industry in three ways. Firstly, it's disrupted the way consumers engage with brands. In the UK and the US now, over 60% of consumers discover brands online.
Secondly, it's lowered barriers to entry, which has led to the rise of insurgent brands that are capturing 25% of the growth, but more fundamentally have reset consumer expectations.
And thirdly, it has fundamentally reshaped the tools that are available to marketers.
CMOs are fully aware of this change. They are experiencing the complexity day to day. But it's also an opportunity for them to lead a transformation. However, it really is a transformation. It's more than just reallocating some of our marketing spend to digital channels.
There are five areas that we encourage CMOs to look at. The first is, what are my future-back platforms that will lead growth for the next 5 to 10 years? Taking today's profit pools and forecasting them present forward just won't capture the level of disruption that's impacting these industries.
Secondly, given those growth platforms, what is the brand portfolio, business portfolio that I'll use to address them? Brand portfolio strategy is definitely rising in importance.
And thirdly, when I'm clear on those platforms and those brands, how am I going to implement modern marketing to engage with the consumer? We're seeing an extreme rise in profitable growth from the clients that we're supporting to reset their marketing model.
But that isn't straightforward. So actually, areas four and five are enablers. Four, what's the data and technology strategy and the roadmap to implement that? The leaders are owning their own data, refreshing it constantly and, more importantly, using it to inform the business decisions. And they're making the technology that underpins that a priority.
And the last area is operating model. The leaders are experimenting with a new operating model. They're shifting their internal ways of working, and they're rebalancing the activities that are insourced and outsourced. There are lots of different models. But it's all with the goal of increasing the control and the speed. And we think that these five actions will help the CMOs lead this transformation for their organization and become the primary engine of growth going forward.