Savvy companies that are grasping Global Portfolio Management as an opportunity will reap its significant benefits, argues Paul Dyson, founder of Data2Decisions.

Marketing has become significantly more complex over the last 10 to 15 years, due to the growth of the internet, an increase in global brand portfolios (where single companies own a range of brands and sub-brands across many countries), an increase in competition for budget, and the ever-growing pool of data that marketers need to make sense of.

All of this has given marketers more brands to manage, across more territories and many more ways to reach consumers. CMOs are then faced with extracting maximum value from their marketing budgets, with the challenges of increasing revenue and profit targets and demanding shareholders.

So what can marketers do?

While things are invariably more complex than 10 years ago, there are huge opportunities for marketers in global marketing. Traditionally, brands are managed on a local level with budgets that vary little from year to year, but some global CMOs are starting to ask whether those budgets are optimum and whether they create the highest return possible.

We have found that cross-market investment optimisation can double ROI and even deliver nine-figure profit opportunities for brands. These are significant gains that typically far outweigh anything that can be achieved on a local level and the smart brands are starting to realise that it is an opportunity not to be missed.

For instance, some brands like Tesco – creating its first head of media in January – are introducing more cross-geography roles at regional and global levels to ensure they start tapping into the value that comes from global media investment,

Global marketing isn’t a new concept. Uniqlo launched a global brand campaign at the end of last year, and EasyJet recently announced the restructure of its marketing team to focus on digital leadership across the company. This trend isn’t disappearing.

Global consumer spend and the additional people that will come online per week globally in 2017 is set to increase by the millions, so marketers need to have their eye across all opportunities to reach consumers. As technology becomes more advanced, data becomes more transparent and we strive to tighten how we measure effectiveness, there is no doubt in the significant opportunities for brands to reach consumers globally.

But what are the challenges?

There are of course some challenges that come with global marketing – for example, the difficulty in implementation.

Not all companies are set up to be able to easily move budgets between countries and doing that requires a change in approach. If it is more profitable to move budgets from country A to country B, then sales in country A are likely to suffer. Therefore, targets should be set accordingly rather than expecting growth everywhere.

From the outset, local brand teams need to be aware of the global picture and the targets they set need to reflect this – rather than hoping to see growth immediately across the board, those expectations need to be managed.

“It would be easy to shy away from the increase in complexity that comes with globalisation and take the easy route”

We have been working on a new report on Global Portfolio Management (GPM), an approach that identifies the optimum allocation of media budgets – optimum in the sense that it creates the highest return possible within the strategic constraints faced by brands. It shows the best way to allocate a global marketing budget across country, brand, product, media channels and time, to maximise return.

Using GPM, brands should be able to understand where the biggest gains are to be made from a global marketing perspective and small steps should be taken to make sure the recommendations are working and to build confidence internally – rather than making significant budget switches immediately.

It is CEOs, CFOs and CMOs who are well placed to drive global marketing spend as they have a wider view of the whole business and are not encumbered by local issues and objectives. GPM presents a perfect opportunity for global client teams to listen to and address local market concerns, and for local client teams to start thinking globally.

It would be easy to shy away from the increase in complexity that comes with globalisation and take the easy route via disparate marketing strategies on a local level. But the savvy companies that are grasping Global Portfolio Management as an opportunity will reap its significant benefits in the years to come.