Putin Protesters Announce Boycott of P&G in Russia
Procter & Gamble Co.is facing a boycott of its products by Russian opponents of Prime Minister Vladimir Putin for supporting state-run NTV television through advertising.
NTV broadcast a documentary called "Anatomy of a Protest" on March 15 that accused opposition groups of paying people to attend their rallies, sparking demonstrations outside its broadcasting center in Moscow and calls from prominent bloggers to boycott the channel and its advertisers' products.
P&G, the largest advertiser in Russia, said in an e-mailed statement today that while it respects the rights of citizens to express their opinions, it rejects any attempt to make it an "instrument" in a political war. P&G accounted for 5.2% of all ad spending in Russia last year, according to TNS Media Intelligence. P&G spent $117.5 million on advertising in Russia in 2010, followed by L'Oreal ($78.8 million), PepsiCo ($72.3 million), Nestle ($63.9 million) and Mars ($57 million), according to Ad Age 's DataCenter.
The boycott campaign marks a new tactic for Russian opposition forces struggling to regain momentum. They brought tens of thousands of people to the streets of major cities to protest election fraud in parliamentary polls that Putin's United Russia party won in December and the presidential ballot March 4 that will put the former president back in the Kremlin.
"P&G doesn't make any exclusive products, so we can easily substitute them with brands of their competitors," said Alexander Plushchev, an opposition activist and journalist, in a blog posting.
The Cincinnati company, whose brands range from Gillette razors to Tide detergent and Pringles chips, had sales of $82.6 billion last year, about 14% of which came from Central and Eastern Europe, the Middle East and Africa, according to the company's website.
"Advertising is a means of bringing information about our goods to a wide range of consumers through all communication channels," P&G said in the statement. "The assessment of contents of TV programs broadcast by licensed TV channels is beyond an advertiser's competence."
Andrei Lyan, a P&G spokesman in Moscow, declined to disclose how much the company spends each year on advertising on NTV, which is owned by the media arm of natural-gas exporter OAO Gazprom, saying that it is confidential "commercial information."
Gazprom is controlled by the Russian government. On its website, Gazprom-Media claims a market share of about 30% of TV advertising in Russia.
Fyodor Bogatyryov, a member of the Solidarity group that has organized a series of anti-Putin rallies, said yesterday he is suing NTV in a Moscow court to demand a retraction to the claim that organizers paid protesters to attend rallies. The channel's owner, Gazprom-Media, hit back at the campaign against it, which it said included hacker attacks that paralyzed the NTV website. "These attacks are aimed against democratic mechanisms, social discussion and a free exchange of views among members of society," Gazprom-Media Chief Executive Officer Nikolai Senkevich said in a statement on the company's website.
Discontent is growing among Russia's urban middle class, which is increasingly fed up with corruption and barriers to unhampered participation in the political process, according to pollsters. Putin, 59, has been in power for 12 years and could stay at the helm another 12 if he runs again in 2018.
The proportion of Russians with at least $500 of monthly income rose to about 50% last year from less than 10% in 2004, according to Citigroup. That helped drive up retail sales by an annual average of 11% in the decade through last year, attracting retailers from Ikea to Inditex.