SOURCE: The Boston Consulting Group

The Boston Consulting Group

January 31, 2012 00:01 ET

Consumer and Retail Marketers Must Rethink Their Strategies, Organizations, and Capabilities to Succeed in a Digital World

According to a New Report from The Boston Consulting Group, Leading Companies Must Make Changes in Four Critical Areas: Strategy, Capabilities, Organization Design, and Culture

BOSTON, MA--(Marketwire - Jan 31, 2012) - Mobile devices and social media mean that for the first time, companies can easily engage with consumers directly, but the learning curve for doing this effectively can be steep. Although 96 percent of companies are using Facebook and 83 percent are using Twitter, few have an overall marketing strategy that incorporates digital and includes clear metrics for success, according to a new report by The Boston Consulting Group. The report, Marketing Capabilities for the Digital Age, presents the findings of a BCG survey of marketing executives at 31 major corporations in Asia, Europe, Latin America, and the U.S. The report presents an overview of the digital landscape, industry-specific guidelines for getting more from digital marketing, and the benefits that leading companies are gaining -- such as higher sales, lower costs, and greater brand equity.

The survey revealed that marketing executives are wrestling with a range of issues, including how to reach customers most effectively at each step of the purchasing process, create the right organization design, build a test-and-learn culture, and find talent with the needed digital expertise. Reported as a top pain point by 29 percent of survey respondents, this talent gap is a key issue -- and an opportunity for recent graduates. Training and metrics are two areas in which many companies fall short. "Although Facebook pages and Twitter 'handles' are free, they do require a commitment of resources: people, training, new-content creation, tracking, and follow-through," notes Katherine Sayre, a BCG partner and coauthor of the report.

Understanding the Consumer

Our survey revealed that 77 percent of companies are struggling to stay on top of where to reach customers -- a necessary foundation for effective digital marketing. In addition, few companies are clear on what they hope to achieve with social media and what consumers want from these new platforms. For instance, businesses typically believe that "feeling connected" is important to social-media users, but most consumers are more interested in getting discounts and making purchases. Moreover, 55 percent of survey respondents have only minimal or informal metrics to measure the impact and return on investment of digital marketing efforts.

Enabling the Marketing Organization

Besides having an effective strategy that integrates traditional and digital media, companies need to rethink and restructure their marketing organizations to fully capitalize on today's opportunities -- a far harder and more time-consuming task. Best-in-class companies have a center of excellence that focuses on innovation and sharing best practices, but they distribute execution to business units or brand teams where possible. Equally critical is the ability to streamline internal processes and clarify decision rights so that new digital capabilities and approaches can enable more agile and responsive marketing organizations.

By setting specific business objectives, testing different digital platforms, and using the right metrics to measure their relative impact, companies can begin to see what approaches work best with their target customers and industry.

To download a copy of the report, please go to www.bcgperspectives.com.

To arrange an interview with one of the authors, please contact Eric Gregoire at +1 617 850 3783 or gregoire.eric@bcg.com.

About The Boston Consulting Group
The Boston Consulting Group (BCG) is a global management consulting firm and the world's leading advisor on business strategy. We partner with clients from the private, public, and not-for-profit sectors in all regions to identify their highest-value opportunities, address their most critical challenges, and transform their enterprises. Our customized approach combines deep insight into the dynamics of companies and markets with close collaboration at all levels of the client organization. This ensures that our clients achieve sustainable competitive advantage, build more capable organizations, and secure lasting results. Founded in 1963, BCG is a private company with 74 offices in 42 countries. For more information, please visit bcg.com.

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