Digital is fast becoming so pervasive for marketers that it may soon lose its meaning as a separate media designation, according to Procter & Gamble Co. Global Brand-Building Officer Marc Pritchard.
It's one of the many ways the company is changing through a brand-building organization he brought together last year that encompasses all areas of marketing communications. And that's not the only way he's been bringing things together. Mr. Pritchard also led the company's multi-brand effort behind the Winter Olympics; such corporate-branding events will become increasingly commonplace, he has said.
Meanwhile, P&G's Brand Agency Leader model, in which a traditional agency serves as a sort of general contractor overseeing and paying other marketing-services shops, also continues to evolve, now covering brands representing about 80% of P&G's sales, according to Mr. Pritchard. Growth of digital may have been a factor in necessitating the new model, but he also cites shopper marketing and PR, which he terms "the most important, authentic part of brand building."
In an interview with Advertising Age at the Cannes Lions International Advertising Festival, Mr. Pritchard explained why we should anticipate more multi-brand events from P&G, the necessity of corporate branding and the economic rationale for its changing agency model.
Ad Age: You seem pleased with the success of P&G's Winter Olympics sponsorship, which also has gotten some honors at Cannes. Do you expect to do more corporate and multi-brand programs like this?
Mr. Pritchard: We are placing a much bigger focus on events, what we call multi-brand events. You see it with "Thank You Mom." You'll see it with Future Friendly (P&G's green marketing corporate effort). You'll see it with the Special Olympics.
Ad Age: The idea behind P&G's corporate structure was always to do a lot of efforts like this, but it used to be hard to get funding from the brands and categories. What's changed?
Mr. Pritchard: Well, we plan these events. And what allows you to really amplify it is to come up with a good idea. That's what really galvanized people to get behind ["Thank You Mom"] -- a great idea.
Another example I forgot to mention was Walmart and P&G Family Movie Night. Once you come up with an idea like bringing back family movie night, that's when you start to see a greater degree of interest tied to it.
We found that when our brands run ads that are associated with shows that are family friendly, they do better. They get 30% higher purchase intent in some cases. It's kind of the idea that brands are judged by the company they keep. And so with that idea, we combined that with the opportunity to get our retailers involved and do retailer activation. That's why we decided to be more active in getting back into the entertainment business.
Ad Age: Is there a risk in doing corporate branding events that you have something that goes wrong with a brand that infects the rest of the company? Or that P&G has some things like animal testing that every time you do something with corporate branding causes a bit of blowback in social media?
Mr. Pritchard: We used to think about it that way. But now we realize that transparency is a way of life for the consumer. It will become even more of a way of life. Now there are 1.7 billion internet connections around the world, and probably in the next 18 months there will be 4.5 billion because of mobile phones. So people know what company brands are attached to, or they can easily find out.
The second thing is that consumers are asking us to know what is behind the brand. What does the brand care for? What does the company care for? That's why we are openly going down this path.
Ad Age: You're talking about internet connections more than doubling in the next two years. Unilever is talking about doubling digital spending this year, and you doubled measured internet spending last year. Do you think your digital spending will continue that kind of exponential growth?
Mr. Pritchard: I don't know the exact number, but we're just following the consumer. I frankly believe we'll eliminate the designation of digital in the not-too-distant future.
Ad Age: What do you mean by that?
Mr. Pritchard: It's so pervasive, that you just stop talking about it as this particular medium and just make sure you're there.
Ad Age: How much of the economic rationale for [P&G's Brand Agency Leader model] had to do with the explosive growth of digital, which under your old model meant additional fees paid on top of what the traditional agency got?
Mr. Pritchard: The bigger driver of the BAL was the need for integration. Anything to find great ideas. That was really the driving force more than an economic reason. And what was critical was that we saw the consumer touching so many different points, it was out of necessity to integrate.
For us, actually, if anything it might have been the store level that was the bigger driver. We start at the store and then kind of back through the path to purchase. Also PR. If nothing else, what I think the BAL is doing is bringing PR agencies to the table, which is such a critical part. PR is the most important, authentic part of brand building. Digital, of course, is important too.