Procter & Gamble Co. is calling on TV networks to join experiments to eliminate the current system of buying based on audience guarantees in favor of more real-time matching of ad supply with viewing demand.
In a keynote at the Association of National Advertisers Media Conference in Orlando on Thursday, P&G Chief Brand Officer Marc Pritchard issued “a call for innovation in media buying and placement, because it’s time to find a better way.”
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P&G will commit “to work with broadcasters to develop and test approaches that will eliminate the current system,” Pritchard said. “Finding a way to match ad supply with viewing demand could make the experience better for consumers. It could create more predictable and stable media buys for broadcasters and publishers—versus the protracted transactions of the upfront dance. It could eliminate inefficient guarantee and liability transactions. And all that could create more growth and value creation with more ad inventory.”
Pritchard described his vision as "a way to buy and place ads synchronized to when people are actually watching—matching ad supply with viewing demand."
Audience guarantees and make goods delivered when forecasts fall short are “incredibly inefficient,” Pritchard said, “because the one thing we know for sure is that the audience forecast is wrong.”
Pritchard compared the TV upfront to panic buying of toilet paper in the early days of the pandemic—buying “as much as possible from as many stores as you can because you can’t predict how long you might be stuck at home.”
What Pritchard is proposing sounds like programmatic buying of TV inventory—which P&G brands already do via The Trade Desk in connected TV—but applied to a broader range of inventory in linear TV. In an interview Wednesday, Pritchard agreed with that description but said the exact form such buying would take depends on how tests are designed.
'Value for the entire industry'
P&G has been trying to kick the upfront habit for a while, though it does still do upfront deals. “We don’t believe the typical upfront process is advantageous to advertisers,” Pritchard said, “so we are working constantly to disrupt it, and that means direct negotiating when we can.”
Networks long have resisted putting a broad range of linear inventory into programmatic trading on the belief that it will drive down prices as it has in digital media. Beyond linear, networks also are looking to sell streaming ad inventory via upfront deals with audience guarantees. But Pritchard said that P&G has been talking to networks about trying alternatives.
“The intention here is to do it in such a way that it creates value for the entire industry,” Pritchard said.
Eliminating audience forecasts, guarantees, make goods and options for advertisers to pare back upfront commitments makes the system more efficient for networks too, Pritchard said. “You’re eliminating a lot of extra transactions.”