P&G's Pritchard Blasts Objections to His Digital Demands as 'Head Fakes'

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Marc Pritchard speaks at IAB Annual Leadership Meeting earlier this year.
Marc Pritchard speaks at IAB Annual Leadership Meeting earlier this year. Credit: IAB

Since he laid down the law for digital-media players at an Interactive Advertising Bureau conference in January to straighten out their mess or stop getting his company's media dollars, Procter & Gamble Co. Chief Brand Officer Marc Pritchard has heard plenty of reasons why his demands aren't reasonable. He has a common description of all these objections – "head fakes."

In a follow-up speech to the Association of National Advertisers Media Conference in Orlando on Thursday, and a pre-speech interview with Ad Age, Mr. Pritchard said nothing has changed his mind. So if Snapchat, Google, Facebook or any other platform can't reliably deliver third-party, Media Rating Council-accredited measurement of ad viewability, or adopt safeguards against fraudulent traffic or inappropriate content by the end of this year, he remains fully prepared to stop spending money on them.

"We will vote with our dollars," Mr. Pritchard said in an interview Wednesday. While digital platforms have "assembled huge audiences," there are also more choices for media dollars than ever, he said, including on TV, where he's noted even digital startups or Google itself spending considerable money.

In his ANA speech, Mr. Pritchard outlined the "head fakes," or objections, he's encountered on all the points from his IAB speech. "We've seen and followed all the head fakes," he said. "But we're not taking them anymore."

Among those are arguments that digital platforms need time to sort through measurements and safeguards for their highly complex offerings. But he noted that P&G has given them nearly a year, and that if they can't address everything in time, they need to focus on verifying viewability, reach and frequency for the most used formats first.

"We are encouraged by the recent progress announced by the big players – Facebook and Google – and what we've heard from several others," Mr. Pritchard said. "But let's also be clear that the announcements indicate intention and work in progress. It's not enough until the verification and audits are actually implemented. We've been more than patient, because we made these requests nearly a year ago. So we need urgent completion, because then we can get to the more important work of understanding the value we're getting."

In his opening talk to the Media Conference, which had record registrations of nearly 500, ANA CEO Bob Liodice noted that only 40% of digital ad spending today actually reaches the consumer -- or the publishers that serve ads to them, with the rest being taken by middle players in the supply chain, something he called "awful." The ANA wants to get that number to 70% he said. A spokesman noted that the group's board last month held an unprecedented meeting with digital heavyweights Facebook and Google to make progress on measurement accreditation.

One objection Mr. Pritchard noted comes more from marketers and media agencies that the MRC's digital viewability standard – which calls for at least 50% of an ad show up for at least a second for display ads and two seconds for video – isn't good enough. Mr. Pritchard acknowledged it's minimalist, adding: "That's exactly what we need and want."

Viewability means "opportunity to see," Mr. Pritchard said, but has been confused with "fully viewed, was recalled, was effective, made an impact, paid attention, delivered ROI and others. …It's really not different than the baseline guarantees TV networks, magazine and outdoor advertisers have given us for years."

He similarly dismissed the "my platform is different" objection from digital players. "It is a choice for a publisher to design a different platform," he said. "But the differences are not a reason to tolerate the complexity of having a different minimum standard to measure."

He likewise dismissed the "It's not designed for mobile" objection, noting that mobile technology providers already had their chance to contribute to the MRC studies.

To the objection that insisting on MRC viewability will cost more, Mr. Pritchard said that's a choice P&G is willing to deal with if it allows better evaluating media investments.

Mr. Pritchard also rejected a host of "head fakes" against requiring MRC-accredited third-party verification. He called privacy concerns from platforms about first-party data "understandable." But he said: "We don't want any private data. We just want to know whether we got what we paid for."

Mr. Pritchard also detailed objections around efforts to ensure all media rebates to agencies get passed through to P&G, and that all media dollars go to pay for media rather than "float" or arbitrage profits made by agencies as part of a transaction.

One "head fake," he said, is the argument that agencies are complying with their contracts.

"Correct," he said. "But we're now changing the contract to include specific provisions specifying that all rebates – including any that occur at the holding-company level – are paid to us."

Likewise, he noted arguments that contracts have had no provision against using money as float. "Correct," he said. "But we're now changing the contract to stipulate that the money we pay must be directly and only used for the media we want purchased."

He dismissed arguments that procurement is making egregious financial demands. "Give me a break," he said. "Procurement, or Purchases at P&G, is a valued resource and expert partner on supply chains that we rely upon to help us, the marketers, to make decisions on fees, work scope, payment terms and contract terms. In the end, procurement is not the problem or an excuse. The buck stops with the marketers who make the decisions."

Media-agency relations have become frayed by "too much complexity, murkiness and waste in the supply chain that all of us have had a hand in creating," Mr. Pritchard said. Simplifying things, he said, will help "will help us get back to the true partnership we had with agencies in the past" with both sides working to create value for themselves "and most important – for consumers."

One reason progress has been slow, particularly on digital measurement, is that CMOs often "simply aren't sure what to do," he said. "I confess that I was in this camp until I started digging into the details, and learned a valuable lesson – media transparency cannot be delegated. The CMO needs to lead and get into the weeds, set the expectations, follow through, and be willing to break some furniture."

He pointed to the ANA's CMO Masters Circle – a peer-to-peer working group in which marketing leaders share best practices and get up to speed on emerging industry issues – as something that can help there.

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