How P&G Hopes to Raise Creative Bar and Lower Costs: 'Cut the Crap'

Pritchard Defends Procurement, Sees Need for More Transparency Beyond Agencies

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How can Procter & Gamble Co. lop hundreds of millions of dollars off agency and production costs and still "raise the bar" on creativity? As Global Brand Officer Marc Pritchard sees it, "cutting the crap" holds some promise.

Mr. Pritchard focused heavily on his "craft over crap" message in a panel appearance and speech at the Cannes Lions International Festival of Creativity last week. In an interview with Advertising Age there, he discussed how the philosophy is also central to how he hopes to simultaneously raise creative effectiveness and cut agency and production costs, which topped out at a high of around $2 billion annually two years ago but are now closer to the $1 billion level where they stood a decade ago.

He also came to the defense of much-maligned procurement people. And in the wake of an Association of National Advertisers report on media agency transparency, he said he's willing to share contract language and processes with other advertisers to help them deal with the problem. Other parts of the industry, such as media companies, need to be more transparent too, he said.

"We should be all for experimenting," Mr. Pritchard said, adding that P&G's "creative canvas" needs to have a strong breadth of media and advertising content. "But the idea is to be more thoughtful, even in the volume of social media work," he said. "What we found, and I think a lot of brands would say this, is that we were just throwing too much stuff out there. We're trying to turn down the noise and turn up the quality, which gives you a better chance of success."

That thinking has guided P&G's effort on creative costs too, he said, which involves "doing fewer things and reinvesting in quality and media, driving the reach that we want."

In this effort, he believes procurement people have gotten a bum rap, countering PepsiCo Global Beverage Group President Brad Jakeman's statement last week that they're interfering with the relationship between marketers and agency people.

"I just don't see it that way," Mr. Pritchard said, "maybe because P&G always has had a philosophy that the agencies are our partners." Part of what P&G does at Cannes is to start the week with top brand marketers and agency creative directors to help build stronger relationships, he said.

"I think some of the procurement comments are a little bit much ado about nothing," he said. "We call them purchase professionals. They are absolutely a valued part of our partnership team. And they work together with us. If procurement is leading, taking over, then that means somebody on the brand is derelict in their duty. And we just don't see that."

He added: "We need to start calling them by their names," mentioning VP-Brand Building Services Kim Kraus, who's worked in the area more than a decade, among others. "These are good people."

One area of procurement he's quite pleased with is media agencies, where he applauded the ANA's work "exposing some areas that are important" but reiterated his belief that undisclosed rebates and other issues mentioned in the report aren't problems for P&G.

"We go through the contracts," he said. "We have a number of stewardship practices. We do audits. …And I am by the way more than happy to help others on that. I think our practices are working." He said helping other marketers craft contracts or audit processes to prevent issues with media agencies "is just good stewardship."

The transparency issue, he said, isn't just limited to agencies, but should be a concern for the entire industry, including media companies and how they share data.

"Because of all the technology and data, we need to take a hard look at transparency," he said. "Let's make sure there's transparency throughout the entire ecosystem, which is going to help all of us make better decisions."

That includes opening up "walled gardens" of data, which he believes Facebook, for example, has been doing, such as through its Cannes announcement that it will open its Audience Insights API (application program interface) broadly to agencies early next year.

"I think the really progressive companies who are great partners are trying to help advertisers make decisions to get the most effectiveness and efficiency out of the media buy," Mr. Pritchard said.