Brand Managers Must Become “Generalists”
From World Advertising Research Center
Brands managers must become “generalists” who are able to deal with the wide range of challenges that characterise the digital and global age, McKinsey has argued.
The consultancy said brand and category managers have long been the “star players” in consumer packaged goods companies, responsible for ”pulling the levers at the center of complicated businesses.”
Such was their success that the top ten corporations in the sector saw their average annual revenues climb from $13bn in 1990 to $47bn in 2009.
However, the trading climate has become much more complex, partly because these firms increased the size of their product portfolios from a norm of 46 brands to 153 brands over the last two decades.
These organisations also currently have a presence in around 160 countries compared with just 112 in 1990, accessing new target audiences and demographics as a consequence.
Marketers control of communications has been undermined
More broadly, the “explosion” of digital and social media has undermined marketers’ control of communications at a time when retailers are demanding customised campaigns.
A global poll of senior executives by McKinsey revealed that 55% of corporations were seeking to improve their brand management at present, but many have failed to effectively realise this goal.
One reason for this is that attempts to cut costs and standardise procedures mean brand managers often have to “cede advertising authority to a global campaign” and surrender control of the supply chain.
Moreover, many companies have added layers of management, divided up their operations into units focused on specific categories and countries, and built departments focusing on digital media.
Brand managers now report to a number of different superiors
As such, 81% of CPG firms now employ “matrix” structures which involve brand managers reporting to a number of different superiors, a figure that falls to 59% in other sectors.
Many brand managers are thus required to spend 80% of their time in meetings in a bid to coordinate and direct the variety of activities in which they are engaged.
According to McKinsey, this total can be reduced to 54% when more efficient processes are put in place, such as the clear identification of overall objectives and who has ultimate power to make decisions.
Reckitt Benckiser, the household goods firm, has achieved this aim by prioritising the 17 “power brands” that deliver 60% of its sales.
It also charges staff with global marketing duties to plan worldwide initiatives covering three year periods, while their local counterparts are made responsible for implementing these schemes.
“[Reckitt's] structure is kept flat, streamlined, and nonbureaucratic, all of which foster speed in making decisions and responding to changing consumer and market conditions,” McKinsey added.
Generalist organizations deliver 2-3% higher organic growth
Elsewhere, it suggested that companies which favour “generalist marketing functions” typically enjoy between 2% and 3% higher organic growth rates than those promoting “specialist groups”.
Procter & Gamble was named as having equipped its employees with the necessary skills in this area, not least because 95% of its brand managers have worked their way up the ranks.
“To reinforce this apprenticeship model, P&G has developed a common marketing language, established an internal marketing ‘university’,” McKinsey said.
“It has also created centers of expertise through global networks of experts with shared competencies, and redefined brand management as a career, extending the time horizons of people in these roles.”
