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P&G looks to digital

28 January 2014
CINCINNATI: Procter & Gamble, the FMCG giant, expects its marketing budget for the coming year to be only slightly up on last year, with a C suite executive reporting that almost one third is being allocated to digital channels.

Chief financial officer Jon Moeller told an earnings call that total marketing expenditure through digital, social and mobile spaces was close to 30%, although he added that this figure varied by category. This compared with the 17% that rival Unilever recently said it was spending on digital.

While the overall budget was not changing significantly, Moeller anticipated that its impact would be "well ahead" of the previous year thanks to the continued embrace of digital.

"We see several more years of effectiveness improvement ahead, driven by new, more efficient digital and social mobile media and big opportunities to continue to improve the efficiency, precision, and effectiveness of our communication" he said.

Among the latter he included improved message clarity and "greater non-advertising marketing efficiencies".

Expanding on the company's investment in digital channels, Moeller said this offered higher potential return, especially in terms of earned media where "a huge number" of impressions had not been paid for. Further, it was possible to target content at recipients more closely in a digital environment. "I expect that will continue to be an area of focus as we move forward," he added.

He cited some examples. The new Smellcome to Manhood campaign for Old Spice Body Spray had generated over 700m consumer impressions to date, he said, "the vast majority of which have been free, through social media and mass media coverage".

And an ad for Duracell batteries – Trust Your Power – which featured the only legally deaf player in the NFL had driven over 1.7bn consumer impressions in two weeks. Similarly, a Winter Olympics ad campaign had generated 1.6bn impressions so far.

Moeller accepted a "responsibility" for growing markets in those categories and countries where it was a leader and said retailers were also looking to the company as partner to grow their own business.

Innovation was an important aspect of this in order to increase trips and grow market baskets. "It's actually more important in many places of the world than share," Moeller noted.

Data sourced from Seeking Alpha; additional content by Warc staff

 
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