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Is P&G saying something loud and clear about digital ad spends?

07-March-2018
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Is P&G saying something loud and clear about digital ad spends?

In a surprising revelation last week, Procter & Gamble (P&G), the world’s biggest advertiser, stated that it slashed digital advertising spend by $200 million last year based on viewership data provided by tech and media companies that showed its ads were not reaching its target audience effectively. P&G’s advertising costs, which includes spends on worldwide television, print, radio, internet and in-store advertising, were $7.1 billion and its digital spending alone amount to a third of the total spend.
It must be mentioned that P&G has been spearheading the campaign to make digital media companies more transparent especially with their claims related to viewership metrics. This campaign by P&G has already forced big digital players like Facebook & Google (which control almost 85% of digital ad spends) to rethink their algorithmic models.
If we look at the Indian market, digital ad spends have played a critical role in the overall adex in the country. According to the latest Pitch Madison Report, digital advertising is projected to grow by about 25% to cross the Rs 10,000 crore mark and grow to Rs 11,629 crore in 2018. With P&G raising concerns about the ROI involving digital ad spends, experts in India are also taking a stand in this battle for greater transparency which P&G has initiated.
Commenting on the P&G’s move and what it means for marketers in India, Harish Bijoor, Brand Expert and Founder, Harish Bijoor Consults Inc said, “P&G slashing budgets on digital means less to P&G and more to every other marketer who uses digital and every intermediary and principal who sells digital media to marketers. Is P&G saying something loud and clear is the question? P&G is a savvy marketing player, possible among the three top savvy ones in India. When it moves, everyone wonders what made this happen.”
“Digital acts as a asymmetrical force multiplier along with traditional media and helps in driving greater efficiency with an integrated planning exercise. Future is about utilizing digital effectively with brand safety enabled”, explains Rohan Chincholi, Head of Media & Business Head Digital, havas-media_751.html">Havas Media Group.
As per a recent Reuters report quoting P&G spokesperson, P&G has not cut overall media spending. In fact funds have been reinvested to increase media reach, including in areas such as TV, audio and e-commerce media. Moreover, top digital advertising platforms like Google and Facebook are currently undergoing an audit of some of their data and ad metrics by the independent measurement watchdog Media Rating Council and the latest P&G move is not out of context in the backdrop of this development.
“It’s about effectiveness. They have raised some pertinent questions around –is it truly measured, is it truly effective” stated Harjot Singh Narang, President, Dentsu One Pvt Ltd. He also underlined how such a move by P&G will encourage other players to look at digital more critically than before.
For Hina Mittal Nayar, Co-Founder & CEO at Profiliad Media Pvt Ltd, transparency still remains a big challenge as far as digital ad spends are concerned. Explaining the P&G move in that light, Nayyar adds, “There isn’t a doubt that digital media is high in yield. But emerging ad fraud and lack of transparency have been big threats to this industry and pain-points for the advertiser. While efforts are being made to counter the ad fraud issue (and have been successful to a certain extent), transparency still remains a challenge. Digital agencies and networks need to create an open and engaging environment for the advertiser on their supply chain, strategies, right audience targeting to counter these challenges and renew the advertiser’s trust.”

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