P&G to Join Roster of Major CPGs Rethinking Media Spend
Procter & Gamble (P&G) is rumored to announce a massive buying and planning review across the United States, Canada and Puerto Rico. This comes on the brink of a wave of CPG giants like Coca-Cola, Unilever and L'Oreal, that are already rethinking the way they spend their media dollars. For P&G, it will be the first time in nearly two decades that it has reviewed its U.S. buying account.
In 2014, the CPG powerhouse spend $2.66 billion on U.S. measured media, which is a decrease from the $3.47 billion it spend in 2013, according to Kantar Media. In 2013, P&G spent $4.99 billion on total advertising in the U.S. and topped Ad Age DataCenter's list of top spenders in the region.
As of May 15, 2015, P&G has declined to comment.
According to recent earnings call comments from P&G Chief Financial Officer Jon Moeller, it was announced that the company aims to cut $500 million in agency fees and reduce the number of agencies it works with. The company doesn't disclose its total spending on agency fees, but according an article from Ad Age, executives close to the company have estimated them at around $1 billion.
And, although P&G has held onto its agency relationships so far, the company has made drastic changes to its digital media buying processes, including bringing in programmatic buying functions in-house under a new internal operation called Hawkeye.
Company CEO A.G. Lafley (August 2014), announced plans to streamline operations by divesting discontinuing or merging more than half of its brands globally.
Ad Age says, "For incumbent Starcom MediaVest Group, defending those P&G brands will likely be a top priority. But the massive review couldn't come at a worse time. The incumbent is also defending its Coca-Cola account. Mondelez, another large client, is rumored to be preparing a review. And late last year, the media agency network lost its AB InBev business to WPP rival Mediacom."
*Sources:
In 2014, the CPG powerhouse spend $2.66 billion on U.S. measured media, which is a decrease from the $3.47 billion it spend in 2013, according to Kantar Media. In 2013, P&G spent $4.99 billion on total advertising in the U.S. and topped Ad Age DataCenter's list of top spenders in the region.
As of May 15, 2015, P&G has declined to comment.
According to recent earnings call comments from P&G Chief Financial Officer Jon Moeller, it was announced that the company aims to cut $500 million in agency fees and reduce the number of agencies it works with. The company doesn't disclose its total spending on agency fees, but according an article from Ad Age, executives close to the company have estimated them at around $1 billion.
And, although P&G has held onto its agency relationships so far, the company has made drastic changes to its digital media buying processes, including bringing in programmatic buying functions in-house under a new internal operation called Hawkeye.
Company CEO A.G. Lafley (August 2014), announced plans to streamline operations by divesting discontinuing or merging more than half of its brands globally.
Ad Age says, "For incumbent Starcom MediaVest Group, defending those P&G brands will likely be a top priority. But the massive review couldn't come at a worse time. The incumbent is also defending its Coca-Cola account. Mondelez, another large client, is rumored to be preparing a review. And late last year, the media agency network lost its AB InBev business to WPP rival Mediacom."
*Sources: