Procter & Gamble Calls for Change to Annual TV Ad-Buying Process
24 September 2020 - 9:08AM
Dow Jones News
By Alexandra Bruell
Procter & Gamble Co.'s top marketing executive called for
changes to the annual TV upfront process during the Association of
National Advertisers Media and Measurement Conference, criticizing
a decades-old method of buying TV ads as antiquated and
inefficient.
During each spring's upfront negotiations, media-buying agencies
working on behalf of marketers commit to buying TV ad time in bulk
for fall and winter programming.
Marc Pritchard, chief brand officer of the
consumer-packaged-goods company, is asking for a later upfront
marketplace, as well as more flexibility when buying ads closer to
the time that they air.
"A better name than the 'upfronts' might be the 'FOMOs,'" he
said in the speech, according to a transcript provided by P&G,
referencing the shorthand term for "fear of missing out." "We
almost always end up buying too much, but we can buy 'options' to
return some spending without penalty -- and to avoid the open
'scatter market' where even higher prices are extremely punishing.
Buying too much inventory is inefficient at best, and at worst,
leads to excess frequency through heavy ad loads in programs --
annoying consumers and wasting money."
Mr. Pritchard said the upfronts allow media companies to glean
information about clients' budget forecasts. They use that
information to determine inventory availability and keep rates high
for marketers despite the long-term decline in TV ratings.
P&G is doing more direct deals with TV networks and relying
less on media-buying agencies, he said in his speech. "We've taken
control of when we negotiate and buy TV media," he said. "To level
the playing field, we negotiate directly with as many as
possible."
Agencies that typically buy on behalf of large advertisers like
P&G, which works with Dentsu Inc.'s Carat and Omnicom Group
Inc.'s Hearts & Science, still play an important role, Mr.
Pritchard said. He didn't elaborate on what that role is.
He also criticized the upfronts for working on the TV networks'
fall-winter schedule versus the calendar year around which most
advertisers do their planning.
Earlier this year, top marketing executives from the Association
of National Advertisers, of which P&G is a member, asked for a
delay in this year's upfront as the global pandemic wreaked havoc
on ad budgets and TV production.
The marketplace was indeed delayed, largely due to the
uncertainty surrounding the industry, especially as sports leagues
delayed seasons and games.
P&G wants the delayed marketplace to stick.
Mr. Pritchard didn't say that P&G won't participate in the
upfronts any more. Rather, he is calling for changes to the upfront
process, a spokesperson said.
Mr. Pritchard also called for social-media platforms to do a
better job filtering their content or be prepared for more
government regulation.
"Social media is about 5% of P&G's marketing spending, but
it's 150% of our problems," he said in the speech. "We are tired of
wasting time monitoring content. It's time for digital platforms to
apply content standards properly so we can spend time on doing good
and driving growth. History has shown that when industries cannot
sufficiently self-regulate, governments could step in."
Write to Alexandra Bruell at alexandra.bruell@wsj.com
(END) Dow Jones Newswires
September 23, 2020 18:53 ET (22:53 GMT)
Copyright (c) 2020 Dow Jones & Company, Inc.
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