Proposal

On

Digital transformation of FMCG retail industry - Impact of implemented digital

advertising techniques on the organization's performance

1. Introduction and Background

The concept of Digital transformation has been prevalent in the business scenario for a
significant amount of time. Its prominence can be attributed to the development of innovative
business solutions based on digital transformative practices that were adopted by several
developed nations to improve their business performances (Hemachandra & Sharkasi, 2021).
The inception of digital transformation in any organization can be traced back to the integration
of different organizational aspects, namely, solving business problems and performing
administrative tasks, with digital platforms. A significant advantage of digital transformation is
that it connects businesses with a broad change of customers by sharing real-time information
(Gunawardene, 2017). Digital transformation has been observed to contribute positively to value
creation through innovative strategies as it is primarily focused on the fulfillment of the needs of
consumers. However, there are other beneficial facets of digital transformation namely,
automation, interactive interface, transparency, individualization, and significant control over the
processes and activities of the respective businesses (Reinartz & Imschloss, 2019). The corporate
strategy of digital transformation is categorized as the operational strategy, which includes the
products and market processes, and the functional strategy which deals with the human
resources, finances, and other tangible aspects of the organization (Matt & Benlian, 2015). An
important consequence of this digital transformation can be observed in the form of digital
advertising practices. Digital advertising is essentially a method of advertising that is based on
computational networks and has three basic dimensions - an innovative way of creating and
displaying advertisements, information sharing with the target audience, and inter-device
connectivity for gathering behavioral information (McStay, 2017). A number of organizations
across various industries have adopted digital advertising techniques to gain a significant
advantage in terms of feedback, interactivity, better quality and quantity of information, and
connectivity over traditional advertisement practices. This is particularly beneficial for small
businesses to reach out to a much wider range of customers and establish their prominence
through a significant competitive advantage in the global market scenario (Gordon et al., 2021).
As companies moved towards e-marketing where they got more opportunities for collaborations
and a much broader market reach, digital advertising became an important aspect of the e-
marketing strategies. The implementation of e-marketing strategies is significantly influenced by
business factors as well as customer-related factors in an organization. This highlight the
importance of consideration of the role of consumers’ perception of digital advertising
techniques to determine their suitability in the industry (Masengu, 2020). For the advertisement
and promotion of a good on the internet, businesses use a number of internet tools. While on one
hand, these tools help businesses increase their sales through information sharing, on the other
hand, it is often observed that the increased use of these internet tools brings challenges, such as
the highly selective nature of the consumers from a broad range of options, cyber security
threats, and even an increased level of competition, especially in the recent times (Horbal &
Orlykova, 2017). The success of digital marketing practices can also be determined by the
perception of the consumers based on their reactions pertaining to the various advertisements on
digital platforms. Previous studies have explored the impact of targeted personalized digital
advertisements on the psychological reactance of consumers. It was observed that when
consumer receives personalized recommendations that are based on their history of web search,
they are more likely to return to the website (Schumann et al, 2014). This highlights that for the
organization to improve their performance they need to focus on the perception of the online
advertisements by their consumers. Digital advertisements benefit organizations by reducing
their operational costs and at the same time establishing a better interactive opportunity and
allowing the organizations to align their business strategies with technological advancements
(Jalang'o, 2015). Further, it has also been observed that digital advertising has a significantly
positive influence on the financial performance of businesses especially those in the FCMG
industry thus benefiting them with a competitive advantage. This established that digital
advertising is an important strategic tool for the sustainability of organizations (Ahmed et al.,
2019). In a time when there is rapid technological transformation, it is important to explore the
domain of digital advertising for organizations to build their competence in the highly
competitive business scenario through optimum organizational performance.

2. Need for the Research

Digital advertising benefits the organization to gain competence in the rapidly transforming
business scenario. However, there is a need to evaluate the efficiency of the different digital
advertising techniques to assess their effects on the performance of the organizations. Further,
there is also a need to compare the efficiency of different digital marketing practices across
various industries to determine their suitability. There is also a significant need to explore the
efficiency of digital advertising on various digital platforms and how it influences the behaviors
of consumers. This will help the organizations focus their advertising strategies according to the
needs of the consumers and retain them for the long term thus ensuring their optimum
organizational performance and sustainability.

3. The rationale for the Study

In a digitalized world, it is important for organizations to establish their virtual presence on

digital platforms to reach out to a wider range of customers. This is primarily achieved through
digital advertising which is an integral component of e-marketing techniques. It is also important
to note that there is a significantly high demand for the products of the FMCG retail industry.
Hence it is important to assess how digital advertising benefits them in the development of their
business strategies and how it impacts their organizational performance.

4. Scope of the Study

The scope of the study is limited to the managers of the different companies in the FMCG retail
industry. This will help with the development of an understanding of the efficiency of digital
advertising in improving the performance of the organization from the perspective of employees
of the organization. This will also provide insight into the impact of digital advertising on the
performance of the employees and how it contributed to the overall performance of the
organization to establish its sustainability.

5. Literature Review

Digital mediums adopted by organizations

According to Mariani & Wamba (2020), the way we communicate has changed significantly
over time. Traditional media was once the only form of communication, but today digital media
is quite successful. Businesses were given a means by which they can communicate and interact
efficiently and affordably due to digital media. In order to be customer-focused in the face of
today's problems and increase competition, FMCG business owners and marketers must think
creatively and on a tighter budget, which is why digital marketing gives them the opportunity to
be equally both cost-effective and to engage with customers in new ways.

The various advantages of adapting digital mediums for FMCG companies are as follows:

It establishes a distinct entity for the brand. The FMCG industry offers a wide selection of
possibilities for consumers to select from because of the abundance of identical items from
different companies. However, having a planned digital advertising and marketing platform in
place allows the business to establish a unique identity. This impacts the consumer's decision to
buy and assists in shaping their perception of the brand (Siamagka et al., 2015).

It enables companies to learn more about their customers and boost ROI. The finest element of
internet advertising and promotion is that they can monitor every aspect of their marketing
initiatives. Traditional marketing did not have this element. The results of these efforts are hard
to quantify because FMCG businesses invest significant amounts of money in advertising
boards, Television advertising, print and radio advertisements, and more. However, digital
advertising and marketing make it possible to track and evaluate each aspect of the strategy.
With the use of analytical tools, one may obtain data on the number of engagements, clicks,
sales, and more. The FMCG brand also can determine which of their advertisements helped
consumers decide to buy their items. The use of advanced statistics can also make it possible to
learn more in-depth information about consumers' purchase patterns. Brands can use this data to
develop targeted ads and produce content that will interest their target audience further. FMCG
firms may improve their tactics and make them more cost-effective as a result of the ability to
monitor digital marketing offerings that come with digital adoption (Ahmed et al., 2019).

It provides a new method of promoting their brand. People are visual beings, therefore brands
shouldn't ignore this fact. The more appealing the package and advertising, the more likely it is
that buyers will notice the brand. Therefore, the way that products are displayed has a big impact
on how buyers decide what to buy. Similar to how a corporation may approach a virtual shelf for
showcase, so can digital marketing. It's among the most efficient way of virtual display and is
reasonably priced. FMCG companies may contextually place their products through digital
marketing as well. Companies can showcase their products while customers search through
related categories using solutions like AdWords Smart Display. If it is a food and beverage
company, for instance, then it may place its advertising next to the restaurant blogs that the target
customers are reading (Safdar & Zaman, 2021).

Emerging digital advertising techniques

Technology advancements have significantly altered how businesses communicate with both
current and potential customers. With the introduction of Web 2.0 technology and the rise in the
number of social media users, people may now readily exchange and consume content on the
Internet in a much more interactive and direct way. More hours are typically spent by users on
social media sites, than on any other platform. FMCG organizations are expanding their presence
on various social media sites as a result of the increase in popularity. The capacity of social
media to promote brands, customer service, sales, and product creation has drawn a lot of interest
from academics and practitioners. Customers frequently use social media to learn more about
goods and services because they believe it to be more reliable compared to any other content
provided by organizations. A growing number of businesses are using social media to interact
with their brands and products by taking advantage of the internet's popularity and recognized
reliability. Digital marketing is expanding quickly and has enormous promise, yet it is still in its
development phase in India. FMCG companies have greatly embraced digital technologies.
Marketers are constantly trying to get consumers' attention. Age, location, and wealth have an
impact on online buying preferences, according to company experts. Younger women or men
with more household income are possibly more likely to make online purchases. Teenagers
should be protected from any risks while shopping online by advertisers on digital platforms that
are trustworthy and dependable. Marketers may utilize Facebook, their own personalized
applications, and Instagram to instantly connect with teenage consumers (Niculescu et al., 2019).

It is crucial to define the word "e-business" in order to fully grasp the Designing with Benefit
strategy. It relates to online purchases: providing goods and services over the Internet, whether as
a single purchase or possibly with a recurring membership fee. Due to their short market lives,
low costs, and sizable retail audiences, FMCG firms profit from digital marketing in a wide
range of ways and have access to countless marketing options. Additionally, FMCG firms can
use their digital strategies of marketing to develop engaging programs and provide customers
with interesting presentations. When it relates to their developing digital marketing initiatives,
FMCG companies must overcome a number of particular obstacles. The need to fight against
each other for storage space and customers' consideration is a significant challenge. FMCGs
frequently lack the benefit of a large audience that other sectors have, therefore they must be
innovative in their own digital marketing strategies. Another issue is that FMCG items are
frequently viewed as commodities, which leads to a lack of brand loyalty and constant brand
switching based on whatever is most affordable or convenient (Bagchi et al., 2012).

Digitized communication and organizations

Customers participate in a variety of actions or behaviors that go far beyond what is considered
to be customer loyalty, like their purchasing habits, how frequently they visit a shop and their
planned behavior. One such medium where customers interact with advertisers on a behavioral
level is digital media. One of the most significant techniques developed in recent years is
customer or consumer engagement. Digital media is quickly becoming a new means of public
communication. The manner in which consumers and advertisers communicate information has
undergone a significant shift in recent years. Today, marketers are focusing on using digital
media for both promotion and marketing communication. Numerous modifications have been
made as a result of the new internet services, adding new aspects to the interactions between
people and organizations. Prior to now, the corporation had complete control over the brand-
development procedure, and brand communications and activities were directly aimed at the
consumers. Following are the five aspects of customer engagement (Saqib & Shah, 2021).

Resources- The customer makes use of a variety of resources, including the internet and their
peers for knowledge. This describes the level of customer engagement with such a service,
product, or brand.

Purpose- It may be started for a variety of reasons, including getting details about the service,
product, or brand, spreading negative or positive information, filing complaints about a defective
product, bad service, or unfavorable customer support of the brand, getting in touch with a
marketer, etc.

Impact- It greatly depends on the type of experience the buyer had when using the product, or
service. This interaction influences the customer's engagement, perception, and communication
of a brand which might be favorable or bad.

Outcome- Retailers can provide people with a variety of solutions or opinions due to the
engagement and the information made available by interaction, for example, incorporating
feedback from customers for product design and improving services.

Scope- Engagement varies depending on whether a customer engages merely to file a complaint
or engages for a longer period of time to help share information about any FMCG brand or their
service (Bagchi & Khamrui, 2012).

6. Research gap

The study creates a gap between digitalization within FNCG companies and customers'
perceptions of buying. The study explains the different technologies adapted by the companies
but it creates a void by not highlighting the way customers react to these new technologies.
Digitalization helps customers a lot to know the products and services being offered but the
impact on customers creates a gap within this particular study. A research gap is analyzed so as
to understand the topic from a much better perspective. The commitment of these brands toward
their customers creates a gap in this study. The brands adapt new methods to advertise their
services and products but they gradually lack behind in communicating with their customers
personally.

7. Research Questions

During the course of the undertaken study, the following research questions will be answered.

RQ 1. What is the contributing role of digitized communication for marketing in the FMCG
retail industry?
RQ 2. What are the emerging digital advertising techniques utilized by organizations in the
FMCG retail industry?
RQ 3. What are the core enablers of digital advertising and related methods in the FMCG retail
industry?
RQ 4. What is the impact of adopted digital advertising techniques on the organizational
performance of the FMCG retail industry?

8. Research Aim

The primary aim of the undertaken research is to investigate digital transformation in the FMCG
retail industry and explore the influence of digital advertising techniques in the FMCG retail
industry and the performance of the respective organization.

9. Research Objectives

For the undertaken study, the following objectives have been laid out that will ensure that the
study progresses in a systematic manner.

RO 1. To assess the contributing role of digitized communication for marketing in the FMCG
retail industry
RO 2. To evaluate the emerging digital advertising techniques utilized by organizations in the
FMCG retail industry.
RO 3. To examine the core enablers of digital advertising and related methods in the FMCG
retail industry
RO 4. To investigate the impact of adopted digital advertising techniques on the organizational
performance of the FMCG retail industry.

10. Research Methodology

The present study will adopt a descriptive research design to understand how the different
digital advertising techniques which emerged as a product of digital transformation influence the
overall performance of the organizations in the FMCG retail industry. The study will adopt the
positivist research philosophy as the study will be using the observations collected from the
various managers of the FMCG retail organizations to get the perspective of the employees
involved. In this context, the adoption of the quantitative research approach will be most
suitable in order to quantify the observations, post the analysis of data, pertaining to the
association of the variables that were identified. For data collection, both primary and secondary
data collection methods will be incorporated. For primary data collection, a structured
questionnaire will be developed based on the five-point Likert scale, which would contain
demographic questions, and general questions about digital advertising and the third section will
contain questions based on the variables identified for the study. The secondary data will be
collected from the review of the literature pertaining to the previously conducted studies in this
domain. The data will be collected from 250 managers of different FMCG retail companies who
will be selected through a purposive sampling method. Further, a deductive reasoning approach
will be incorporated to analyze the results and establish the causal relationships between the
concepts and the variables.

11. Results and Implications of the Study

The results obtained in the study will help in developing a comprehensive understanding of the
impact of digital transformation on the FMCG retail industry. It will further present a deep
insight into the critical success factors and the effects of different advertising techniques on the
performance of the organization. This understanding will help the organizations develop a
suitable advertising strategy that will ensure optimum employee and organizational performance.
This will further help in establishing organizational stability and help expand their consumer
base.

12. Chapter Scheme

For this study, the following thesis structure has been laid out.

Chapter 1: Introduction:
This chapter will present the primary aims and objectives, the research questions of the
undertaken study, and the research background.

Chapter 2: Literature Review:

This chapter will review the existing literature on the topic for the present study and identify the
research gap to get a better understanding of the problem at hand.

Chapter 3: Research Methodology:

This chapter will lay out the Research Design, Research approach, Research paradigm, Sample
Design, Data collection, Data Analysis, and Interpretation for the present study.

Chapter 4: Data Analysis:

This chapter will present the results derived using different data analysis techniques.

Chapter 5: Result discussions and Findings:

This chapter will present the interpretation of the results and the relationships between the results
and observations from the literature review.
Chapter 6: Conclusions and recommendations:
This chapter will present a comprehensive summary of the investigation, drawbacks, and
limitations, recommendations for improvements, and future research prospects in the same
domain.

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