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Marketing vs Digital Marketing Transformation


Ramon Murguia Marketing Function Evolution

How to become a digital enterprise?, how to evolve into a digital organization?, how to invest in digital? how to engage consumers digitally? are few of the questions that every organization is making today. If we look at the US investment projections tells us a very good story on how the world of advertising and marketing is changing, how the capabilities required for marketeers and functions in the organization will require an evolution and how everyone will face and require a new business approach. Take a look at the following chart projections from PwC. As a matter of fact, even if we see some growth in some of the traditional investments as we know them, we can see that all of the growth is coming from digital as well. 

Ramon Murguia media investment
Ramon Murguia Investment Chart

If we take these numbers an arrange them to compare the investment on traditional marketing vs digital, we can see the following chart. Traditional marketing investment will decrease 20%, digital will be growing 70% and the overall investment will increase 14% in the next 3 years. The challenge now, for companies everyday will become how to face competitors while they are speeding up, suppliers that are evolving, new entrants companies that can easily become substitutes and how to face the changing rules and the environment while it is being transformed due to technology not only in marketing but as an organization. 

Having shown the previous information, there are several questions for every organization.  First, Do you think you need to change? if your answer to that question is no, read no further. If you see a need for change, some of the challenges you will face are on convincing everyone how to do things different, how to creare new organizational structures and accept the changes, how to organize process, policies and flows to address the speed require in a new environment.

Today there are many decisions companies need to make towards the organization structure on regards digital. There are organizations that digital is part of the Chief Marketing Officer role and here we have the majority, from McDonald's, Procter, Unilever, Pepsico, Apple and others that are already implementing new roles in the organization, such as Chief Digital Marketing Officer like Coca-Cola or SAP and others that are creating new departments having Chief Marketing Officer, Chief Digital Officer and Chief Technology Officer.

Today brand and demand go hand in hand and capabilities on a new environment need to change. Take a look at the New Marketing Department article written last week. There are some of the things that every strategist and marketing chief should consider. First, make your digital strategy part of the overall company strategy. Digital isn’t just a new thing, it’s a new way of working and doing things. Companies are focused on developing a digital strategy only, when they should focus on integrating digital into all aspects of the business, from channels and processes and data to the operating model, incentives, and culture and here is where is not only a marketing only issue. Secondly and very obvious, the obsession with consumers must increase. With all the technology, information, change in consumer behavior and available data, whomever is responsible for engaging with consumers must be up to it. Moreover, this last point adds a requirement for speed, agility and data consumption different from what most organizations and heads are use to. Finally, being open to every network and new technologies is fundamental, since most of the struggles will not come from competitors but from many small, medium and new technology companies that are speeding up the process and challenges of how the world will work.

In conclusion, the traditional way of investing and doing things will be challenge by many external forces, from competitors, substitutes, technologies and suppliers, we no longer are able to keep the same way of working with the same structures. Moreover, who should dictate the organizational direction is becoming more of a blur everyday. Review your structure, your competitors, get benchmark from other industries and make sure you integrate your suppliers and all functions from the organization to make it happen.

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