As expected, McDonald will be CEO at Procter & Gamble July 1

At a time cash-strapped consumers are rethinking what they buy, Procter & Gamble pg, the world's largest consumer products company, has selected a new CEO whose key tasks may rank among the most daunting ever faced by a P&G chief executive.

With the expected selection on Wednesday of Chief Operating Officer Robert McDonald, 55, as new CEO, the Cincinnati-based marketing giant signaled that the embrace by outgoing CEO A.G. Lafley, 61, of a new world of fast changes and new media will not only continue, but likely will go into overdrive.

This leaves McDonald, who becomes CEO on July 1, with challenges aplenty. "The generation that is P&G's primary buying population now vs. 10 years from now will have as many media consumption changes as any generation has ever experienced," says Jeffrey Hill, industry consultant and former P&G brand manager.

Both McDonald and Lafley declined to be interviewed. But consultants and executives who know them spoke of challenges McDonald faces:

• Responding to price pressures. In a tough economy, cheaper private-label brands are stealing shares. Under McDonald, P&G must continue creating products whose value can be real or perceived, says Hill.

• Fighting off competition. Rivals such as Colgate-Palmolivecl and Unilever have "gotten their acts together" and are more nimble, says Gary Stibel, founder of New England Consulting Group and former P&G brand manager. McDonald must contend with tougher competitors than did Lafley, he says.

• Adapting to new media. Even though P&G has been a leader in embracing new media, McDonald will need to rely increasingly upon advice from a younger generation of new media specialists, Hill says.

• Growing globally. With rivals such as Unilever stronger outside the U.S. than P&G, McDonald must use his experience as P&G's chief in Asia to grow globally, Stibel says.

• Tapping consumer needs. Much of P&G's recent growth has been in health and beauty areas — not in its traditional strongholds of home and laundry. Since health and beauty are not his expertise, McDonald will need to tap the advice of others.

• Investing in research. Few companies spend more on R&D than P&G. To differentiate its products, McDonald must maintain that and likely will have to fight off calls to cut R&D spending, Hill says.

• Responding to the unexpected. As CEO, McDonald must be quick on his feet. Tim Smucker, co-CEO of J.M. Smucker, saw that several years ago at an industry conference in Cape Town, South Africa, attended by executives from 80 countries. When the keynote speaker took ill moments before he was supposed to speak, conference chairman Smucker asked McDonald to fill in. Without hesitation — and without notes — McDonald gave a five-star presentation, he says.

• Following a tough act. Lafley, who will stay on as chairman, has been a "superstar" CEO, says Stibel. "He (McDonald) will be following one of the greatest leaders in business today."