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P&G cuts $100m in digital adspend, sees no business impact

28 Jul 2017  |  Newsline Staff 
P&G cuts $100m in digital adspend, sees no business impact

Procter & Gamble, the world's largest advertiser, has said cutting its digital marketing spend by more than $100m has had little impact on its business.

The news, reported by the Wall Street Journal and briefly noted in its latest earnings report, suggests that much of its digital activity was ineffective.

P&G said digital ad spend was lower in the April - June 2017 period after the business temporarily restricted spending in digital forums where its ads were not being placed according to its "standards and specifications" - culling ads that were being placed on sites with fake traffic or with objectionable content.

After reducing its digital advertising activity, P&G's finance chief Jon Moeller told WSJ journalists during its earnings call on Thursday (27 July) “we didn’t see a reduction in the growth rate....what that tells me is that the spending we cut was largely ineffective.”

At the start of the year Procter & Gamble's chief brand officer, Marc Pritchard called on the industry to "clean" digital up advertising - especially around the muddied waters of media buying and viewability.

"We have a media supply chain that is murky at best and fraudulent at worst," Pritchard said at the IAB's annual leadership meeting in February. "We need to clean it up, and invest the time and money we save into better advertising to drive growth."

Pritchard said P&G is currently poring over every agency contract in an attempt to achieve full transparency by the end of 2017 - including terms requiring funds to be used for media payment only, all rebates to be disclosed and returned, and all transactions subject to audit.

That also means adopting basic viewability standards, ditching the adtech middle men, breaking down walled gardens, and getting serious about measurement.

In line with that commitment, P&G said on Thursday it had reduced overhead, agency fee and ad-production costs in the quarter.

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