P&G To Cut TV Budgets? Hard To Believe

The bet is more than a few TV executives spent Wednesday analyzing every word of a Wall Street Journal piece with the diligence of a lawyer parsing through a court decision hoping to find grounds for appeal. This, after all, was a Q&A with the top marketer at the company that has long controlled much of the advertising market and the subtext wasn’t exactly “tell us why you love TV so much.”

Procter & Gamble, which fills sportscasts with all kinds of Gillette ads and might fund a reality series if a brand can be a “character,” has been making noise about cutting its massive marketing budget by perhaps $1 billion over the next five years. And, the implication has been savings aren’t coming by shifting dollars from broadcast to cable, but slicing TV budgets altogether -- while looking for cheaper, more accountable alternatives such as YouTube videos or Facebook stunts.

“Leaning more heavily on lower-cost digital marketing and easing up somewhat on pricey broadcast ads,” the WSJ suggested.

And yet, as P&G head of marketing Marc Pritchard’s quotes unspooled in the paper, there was no evidence the company has lost faith in TV. He didn’t suggest the cost-benefit of a prime-time spot has lost luster; that P&G is frustrated that every year it pays more to reach smaller audiences; that ad-skipping is so rampant it's a crisis; or the upfront market is a relic.

The Q&A was edited for space, but if Pritchard had gone in any of those directions or lobbed any knock on TV, rest assured that would not have been on the cutting room floor. Quite the reverse, it would have been in the headline.

In fact, a reference Pritchard made to TV amplified P&G’s endorsement of it. The company is preparing a huge campaign this summer in conjunction with the London Olympics. In 2010, it made a long-term commitment to NBCUniversal, er, the Olympics when it signed a 10-year deal as a sponsor, where it will fill NBCU’s coffers every two years with ad bucks.

Essentially, the WSJ interview was a garden variety “digital marketing is the future, so we believe we need to a leader there” rundown. There were mentions of Google and Twitter and the potential of Shazam, which incidentally has an interactive TV application that could bring digital-like metrics to TV.

But, what the interview did make clear is that TV executives need to continue to position the medium as Sandy Koufax and digital platforms as Johnny Bench. Initiative’s Kris Magel deserves credit for the pitcher-catcher metaphor, saying last spring that TV spreads a message and digital is “sitting there like a giant catcher’s mitt.” The “mitt” being Twitter conversation, the chance to get more product information or instantly make an e-commerce buy.

Pritchard made clear the baseball analogy is where P&G is. With the Olympics, there will be all types of social and online video stuff, but it's counting on help from TV to drive the interest.

“We have more than 30 brands doing Olympics activities, 150 athletes, all those brands have Facebook pages, all those athletes have Facebook pages,” he told the WSJ. “Then we go out, create an event, talk about it, push it out, through broadcast and digital. Then we have community managers who are amplifying the discussion, engaging on Facebook, on YouTube, things like Twitter. That's the way it'll work.”

As TV research departments invest in set-top-box data and “single source” products, it might make sense to find ample dollars for social media measurement services, ones allegedly able to link ad viewing to tweeting and Facebooking. Then, they could say: "Hey, Mr. CMO: we’re incredibly fired up, too, about all those new “followers” and “likes” you’re getting. Here’s why: all those prime-time ads."

Pritchard said P&G is involved in an industry initiative that will gauge how much a Twitter or Facebook impression is worth via an EGRP (electronic gross rating point). Networks not involved might want to rethink that one.

In the interview, amid his digital evangelism, Pritchard seeded other doubts that P&G may meaningfully flee TV. At one point, he seemed to note brand managers at the company will continue to make decisions about what drives their brands best. Even if he likes the digital gambits and appreciates the innovations at Pampers, Secret and Old Spice, “it’s who’s interested, who wants to push it.”

Pritchard said Old Spice’s successful “Smell Like a Man, Man” campaign didn’t thrive because of a TV campaign, but got “huge lift on YouTube, then they amplified it in PR, amplified it on Twitter.” Yet, the TV ads were pretty memorable. So, not so sure about that claim.

P&G may never buy a Super Bowl spot again, but it’s hard to believe marketing savings are going to come from major TV cutbacks. It may try, but it’s likely that tide will change quickly and the company's (P)interest in TV will be renewed with some Braun. 

Tags: television
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5 comments about "P&G To Cut TV Budgets? Hard To Believe".
  1. Doug Garnett from Atomic Direct , March 14, 2012 at 7:20 p.m.
    You do realize they make this announcement every few years? It's a great political move for a P&G marketing guy...but unlikely to be a smart move for P&G... :-)
  2. Tim Orr from Barnett Orr Marketing Group, Inc. , March 15, 2012 at 7:07 p.m.
    You say, "ad-skipping is so rampant it's a crisis." Data, please.
  3. Kevin Horne from Lairig Marketing , March 15, 2012 at 11:46 p.m.
    A quick look at what a "digital only" campaign by P&G would leave on the table: http://lairigmarketing.typepad.com/lairig_marketing/2012/03/procter-gamble-gambles-on-digital.html
  4. Doug Garnett from Atomic Direct , March 16, 2012 at 5:41 p.m.
    Re: Ad-Skipping. Whether ad skipping is "rampant" or not doesn't matter. The studies show that DVR's haven't hurt TV ad effectiveness and look to have even helped it. In fact, what appears to be happening is that DVR's purely automate behavior that has been true for decades (half a century?). So I think what we're hearing here is the "we think it so it must be" approach to fact finding. AND, somehow the ad biz is convinced that saying it makes them sound sophisticated and up to date. Sadly, for a lot of unknowing ad folks it does. In reality, it makes them sound out of touch and shallow.
  5. Tim Orr from Barnett Orr Marketing Group, Inc. , March 16, 2012 at 6:09 p.m.
    Couldn't agree about ad-skipping more, Doug! After all, Aristotle insisted that a 2-pound weight dropped at the same time from the same height as a 1-pound weight would hit the ground sooner. That "logic" was believed for nearly two millennia until Galileo came forth with data. Way back in the 60s, I was told that nobody was watching TV any more, except that viewership kept going up and up. It just ain't fashionable to believe there's any value in TV any more. TV is dead. Print is dead. Everything is dead. Including reverence for evidence.