P&G and Viacom Ink $300m Cross-Media Deal

31 May 2001

Procter & Gamble is the latest advertiser to enter into a cross-media advertising deal, forging a $300 million partnership – the largest of its kind to date – with Viacom.

The one-year agreement, negotiated on behalf of P&G by MediaVest USA, initially involves the consumer goods colossus receiving ad time on Viacom-owned television networks CBS, MTV, VH1 and Nickelodeon. However, the advertiser expects the partnership to broaden into the media group’s outdoor and radio interests, including the Blockbuster video rental chain. The deal may also be extended globally.

P&G, which is still free to negotiate with other media companies, may also become involved in content. Global director of marketing Bob Wehling suggested that the group might work alongside Viacom’s BET division – which encompasses the Black Entertainment Television network as well as radio, publishing and online operations – to help provide a curriculum for schools during black history month.

Another potential perk for the advertiser, continued Wehling, could be future access to the media company’s research on teenage girls, of significant benefit to P&G brands such as Cover Girl and Tampax.

The consumer goods giant could also get preferential treatment when seeking popular slots – one example cited by Wehling was VH1, where P&G has previously had problems buying time to advertise its beauty products.

The deal is expected to herald an increasing number of cross-media partnerships between advertisers and media groups – such agreements are already being offered by AOL Time Warner and NBC [WAMN: 01-Feb-01; 25-Apr-01]. As much as 40% of all adspend, predict Viacom and P&G, could be devoted to multimedia pacts in the future.

“This is only the first inning,” commented Viacom president/chief executive Mel Karmazin. “Most ad agencies and most clients haven’t geared up this sort of advertising yet.”

News source: Wall Street Journal