A year ago, Procter & Gamble’s chief brand officer Marc Pritchard gave a one-year ultimatum to its digital advertising partners stipulating that they clean up their practices and play by P&G’s rules or risk losing lucrative 2018 money from the US largest advertiser.
Let’s see how P&G’s redefines its digital strategy.
A Lack of Transparency
In January 2017, P&G chief brand officer Marc Pritchard caused a stir in the digital when he announced he will review all with digital platforms in the coming year. A significant part of the $2.4 billion marketing annual budget is at stake.
P&G asked for the implementation of the single standard for ads viewability as defined by the Media Rating Council, IAB and Mobile Marketing Association along with accredited third-party verification, more transparent contracts and additional ads fraud prevention. From Bank of America, Unilever and more added their voice to P&G’s for demanding more transparency. According to the latest IAB annual report, the measurement will be a key focus for 57 percent of marketers surveyed.
Fox and Henhouse
During his speech at the IAB’s annual leadership meeting in Ft. Lauderdale, Pritchard said that more third-party verification is needed regarding of dollars that are spent on digital advertising. P&G’s competitors are spending billions without asking for it he was said by a top executive from a major tech company.
It may be true, he replied but
Google and Facebook are actually doing their own self-reporting for what defines a viewable ad, it is a little like letting the « fox guard the henhouse » he concluded.
A Quarter for Every Digital Dollar
The question of transparency is crucial as P&G along with other companies do not have its money back on digital spendings. In October, at the annual Conference in Orlando ANA’s president and CEO Bob Liodice revealed that 259 companies on the 2016 Fortune 500 list had declining revenues.
The problem? « It boils down to a lack of effective marketer leadership, » said Bob Liodice. « As leaders, we, as an industry, have refused to make the tough calls—calls that would take us out of the cesspool of suboptimum growth. For example, we as leaders should not accept this byzantine, non-transparent, super complex digital media supply chain. No one can understand it. »
He continued: « Yet we keep feeding the beast by pouring incredible sums of money into this unproductive, unmanageable abyss. Remarkably, we keep doing so even though we know that only 25 percent of every digital dollar reaches the consumer. … [that] represents more than $20 billion in marketing waste, inefficiency and ineffectiveness. » The ANA’s response to this lack of growth issue is a 12 point guide.
Red Alert and a Call
Brand safety is another point, not raised by Marc Pritchard in his January’s speech, but that is crucial for P&G and other FMCG companies. The converse grew with ads appearing on controversial websites like Breitbart through Facebook ad networks or programmatic-advertising. In March CMOs either stopped or pulled out YouTube campaigns after their ads ran next to objectionable content. For instance, P&G cut between $100 million and $140 million in digital ads spendings in March.
Facebook addressed these issues quickly and released solutions for the Dmexco in Germany. As a result, brands could see whether their ads run on a controversial website instead of having to make an educated guess. The post-campaign tool is also reportedly plugged into Instant Articles and in-stream videos that users post on social media.
Red alert, Facebook VP of global marketing solutions Carolyn Everson sent a clear sign that the biggest digital players in the world are paying close attention to Pritchard’s message: « There is nothing more important than marketers trusting and believing that the advertising ecosystem is transparent, accountable and safe ».
P&G’s New Digital Strategy
In October, Pritchard said the company is « about two-thirds complete on these steps today and should be largely finished by the end of 2017. ». The number of media partners was reduced to 200 « trusted and proven-clean media partners to cut off the bot-laden long tail » Pritchard said.
« The data now shows that the average ad-viewing time can be as low as 1.7 seconds, pretty much a blink of an eye, with only 20 percent of ads viewed for more than two seconds, the minimum standard, » he said. « We stopped wasting money on 30-second ads [for digital], and we’re designing ads to work in two seconds.».
The company also found it was « reaching too few people too many times with too many ads, » Pritchard said. « Excess frequency is a massive source of waste, and it really annoys consumers. No wonder ad blockers are growing 20 percent a year. I mean, how many times does a person need to see a toilet paper ad to get the point? ». « We’re also working with e-commerce players like Amazon and Alibaba to use unique ID data to reach consumers closer to when they’re ready to buy, » Pritchard said. « This is accelerating our $3 billion e-commerce business and cutting waste by 20 percent. But most important, it’s creating a better consumer ad.».
Hit Me Again
John Wanamaker, a proponent ad expert and a pioneer in marketing, is also known for one of his quotes: « Half the money I spend on advertising is wasted; the trouble is I don’t know which half. ». Actually, the return on investment in digital advertising is deceptive for advertisers like P&G, as the ratio is a quarter to one. The message sent by his chief brand officer is clear.
Brand safety, ad fraud, ad blocking, viewability, verification and value are all important issues in their own right, but it concerns me that as an industry we seem to see them each with tunnel vision, jumping from one to the next, rather than seeing them as connected and part of a holistic digital landscape » says Unilever CM O Keith Weed.
This is where digital advertising should be heading in the future.
Source: Tanya Dua from UK Business insider