What is the decision facing the company?
Nestlé must decide whether to improve its digital advertising strategy and guarantee that the message is effectively delivered to the target audience. In particular, the business must learn to use disruptive technologies like blockchain to strengthen its advertising initiatives in a quickly expanding digital market.
What factors are important in understanding this decision situation?
Several important elements play a role in this decision-making scenario:
Market power and influence: Nestle’s substantial market enables it to influence digital advertising intermediaries and establish standards for digital media suppliers.
Growth and Losses Anticipated: Effective methods are critical given the digital advertising sector’s explosive expansion, expected to reach $427 billion by 2022. Juniper.
Research Growth and Losses: Research’s projection of $100 billion in possible advertising losses by 2023 emphasizes the urgency even more.
Budget Allocation: Nestlé devoted 40% of its advertising expenditure to digital advertising in 2019, demonstrating how heavily it relies on this channel.
Blockchain Technology: The idea that blockchain technology may be used as a fix could cause a major technical shift in advertising.
Recommendations
The first option:Improved Blockchain Integration (4 P’s)
Implement tracking and verification methods for digital ads based on the blockchain.
Price: Invest in the deployment and upkeep of blockchain technology.
Place: Work with expert blockchain service providers.
Promotion: Promote blockchain technology to guarantee precise and safe distribution.
Product: Implement blockchain-based tracking and verification systems for digital ads.
Pros: Improved audience targeting, decreased ads fraud, and increased transparency.
Cons: Exorbitant start-up costs and possible technical implementation difficulties.
Alternative Two:Diversified Advertising Channels (4 P’s)
Product: Create a multi-channel advertising strategy that combines traditional and digital media.
Price: Distribute funds among several channels in a proportionate manner.
Place: Increase collaborations with different media intermediaries.
Promotion: Highlight how using both traditional and digital platforms may be beneficial.
Pros: A wider audience reach and the possibility to reduce losses due to disruptions from digital ads.
Cons: Difficult synchronization and possible blurring of digital focus.
Alternative Three:Targeted Content Customization (4 P’s)
Product: Invest in content personalization powered by AI for online ads.
Price: Allocate resources towards the creation and use of AI.
Place: Collaborate with suppliers of AI technologies.
Promotion: Emphasize the use of AI-driven content to provide individualized ad experiences.
Pros: Better customer experiences, higher engagement rates, and increased ROI.
Cons: Needs AI knowledge; may raise privacy issues.
Recommendation(s) for Action:
I suggest the following solutions depending on the circumstance:
The company’s demand for dependability and transparency is met by enhanced blockchain integration, an alternative given Nestlé’s large reliance on digital advertising and the potential losses predicted for the sector.
A second option is to use a variety of advertising channels. Nestlé should investigate a balanced strategy combining traditional and digital advertising to reduce possible losses and adapt to a changing environment. This strategy protects against problems with a single medium.
Recommendations for Implementation:
Option One (Integration of Blockchain): Nestlé should collaborate with reputable blockchain service providers, allocating funds for technological integration and training. Working together with industry leaders will guarantee successful deployment and handle technical difficulties. The integrity of the system should be ensured through routine audits and monitoring.
Alternative Two (Diversified Channels): Nestlé must create cross-functional teams to manage the multi-channel strategy. The company’s priorities and the target audience’s preferences should be reflected in budget allocation. The efficiency of each channel should be evaluated, and channel allocation should be optimized using tracking and analytics technologies.
References.
Kumar, S. O. (2021). Impact Of Blockchaın In Marketıng And Advertısıng In 2020. https://www.blockchain-council.org/blockchain/impact-of-blockchain-in-marketing-and-advertising-in-2020/
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