P&G'S $140 million lesson in transparency

The industry had a seismic reaction to the news that Procter & Gamble slashed digital ad spend by $140 million last quarter, and did so without any negative impact on their business results. P&G cited brand safety and “largely ineffective” ads as the reasons behind the massive cut. Many in the industry reacted with trepidation and anxiety—likely because of what it portends to their own business model—but P&G's move shouldn't have come as a surprise. The company started making waves in 2016 when it put the industry on notice (first privately to its partners; then publicly at an IAB event) about their new standards for digital advertising transparency. After examining all of its agency partner contracts, as well as taking a broader look into its media supply chain, P&G didn't like what it saw. (Or, rather, what it didn't see, due to the lack of transparency throughout the supply chain.) In April, P&G announced it would cut spending by $2 billion over the next five years. So the news of a $140 million cut follows what P&G has been promising for about a year now. It looks like P&G had some fat to trim from its media plans, mostly due to inefficient ad campaigns. That shouldn't be news to anyone, since not all digital media spend is accretive, especially when advertisers don't have viewability benchmarks for their channels. Given that reality, advertisers of all sizes need to move away from black-box technology providers, publishers and agency partners that rely on opacity as an advantage. Additionally, sophisticated marketers need to develop their own marketing-mix model, powered by data-driven, multi-touch attribution, so that they can accurately evaluate how each channel impacts the overall mix. Media measurement blog Tracking TV, social and digital updates Click here Marketers need to ask their publishing and agency partners the following questions, and if you have a partner whose priority is your brand's business health, you shouldn't have to compromise on any of these. By taking these proactive steps, brand marketers have the unique opportunity and a second chance to reevaluate their digital ad spend, get more value for their investments, and ultimately create a better experience for their customers. Sign up for Ad Age newsletters From influencer marketing to agencies, get the latest news and analysis delivered to your inbox Click here

P&G'S $140 million lesson in transparency

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