Two Lessons from the World's Largest Advertiser

During Procter & Gamble's 3rd quarter conference call last week, the world's largest advertiser expressed two predominant spending themes: scale and responsibility.

The first one is fairly straight forward. P&G spends billions of dollars a year on advertising. By negotiating buys across brands, like it did at the Olympics with 18 brands participating, the CPG conglomerate can reap the benefits of its scale and theoretically negotiate more favorable terms on media, marketing and sponsorship buys.

With P&G devoting more resources to non-traditional marketing channels than ever before, CEO Robert McDonald spoke about a responsibility to enhance the quality of content and programming. Not just for the sake of better content consumption though. He says the majority of Moms are unhappy with programming on TV, which is presumably what led P&G to delve into content creation in the first place. The idea being that better content surrounding their ads, enhances the value of the ads themselves. Here's what McDonald had to say about providing a better context for their messaging:

"I think it's important that we focus more on the effectiveness of the A&P spending not just the spending itself, it's if you have seen our Secrets of the Mountain movie that we have produced and aired in conjunction with Wal-Mart, it won, it was the number one show for the whole night. 93% of moms liked the movie, 88% thought it was an excellent quantity, 74% rated the commercials favorably. 26% increased the favorability of the brands that were advertised on that show. And in total, the purchase intent for our brands indexed 270%. Research from the Association of National Advertisers indicates that only 23% of moms are happy with the family-oriented programming currently available on television. As the world's largest advertiser, we have a responsibility and an obligation to improve the quality of that programming. And as I showed by these numbers, it's in our best interest to do that because it makes our advertising more effective. So try not to just focus on the spending, but also focus on the quality of the advertising and the context in which it's aired."

Whether it's TV programming, online content or event sponsorship, this is a maxim that is applicable across marketing mediums. A more valued overall experience, creates a context that is more favorable and receptive to sponsor and partner messaging. It's in the advertiser/sponsor's best interest to add value (and spend the money) to the property they are aligning with. Of course, the Secret of the Mountain is a small deal in retrospect to P&G's $100 million partnership with the Oprah Winfrey Network announced last week, but the lesson is the same: don't buy the razor unless you're prepared to spend on the blades.

#activation

source: seekingalpha.com