P&G to base agency pay on sales

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Procter & Gamble Co., Cincinnati, announced today it will shift from a straight commission system for its ad agencies to compensation based on a percentage of sales. The new policy will compensate agencies based on global sales for the brands they handle, and is meant to increase sales growth, encourage more "holistic'' marketing plans and reward agencies evenly for work across the world, a spokeswoman said. The announcement ends a compensation experiment in which P&G considered both fee-based and sales-based models.

Copyright September 1999, Crain Communications Inc.

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