P&G marketing layoffs new sign of the times, expert says
Consumer goods giant Proctor & Gamble鈥檚 move to lay off some 1,600 employees globally, many in the marketing area, foretells a trend in which more companies will move their advertising dollars from traditional to digital media, says a marketing expert at Washington University in St. Louis.
Proctor & Gamble is banking on digital marketing to help contain media spending in the long-term.
The company鈥檚 CEO, Bob McDonald, says he expects its advertising costs to moderate as it moves into the digital arena, citing the billions of free impressions generated by Internet-only ad campaigns, like P&G鈥檚 Old Spice commercials in recent years.
鈥淲ith the advent of digital ad tracking software and digital ad shops like Google, companies are able to track the effects of digital ads in real time in a fine-grained manner,鈥� says Seethu Seetharaman, PhD, the Patrick W. McGinnis Professor of Marketing at Olin Business School.
鈥淐ompanies can quickly monitor who is clicking on an ad, with whom they are sharing the link to the ad and what that second person is then doing,鈥� he says.
Traditional media offers no such capability.
鈥淚s it possible to track whether someone who bought Time magazine this week actually viewed the ad on page 10?鈥� Seetharaman says.
鈥淥r if so, how much time did he spend viewing the ad? Did he show the ad to his spouse or other family member?鈥� he says. 鈥淭his aspect, coupled with digital content consumption from news websites and others, is fast displacing traditional content consumption, making it likely that traditional media will lose their importance moving forward.鈥�
In the pre-digital media era, companies had no choice.
鈥淭he rationale for their large traditional media spend was, 鈥楾his is necessary for brand building for the long term鈥� even if they could not measure return on investment in terms of sales impact or even eyeballs鈥� impact,鈥� Seetharaman says.
鈥淎 manager complaining, 鈥業 know half of the money I spend on advertising is wasted. Unfortunately, I don鈥檛 know which half鈥� was still making an understatement,鈥� he says. 鈥淪uch compromises are no longer necessary in today鈥檚 world.鈥�
Provided by Washington University in St. Louis
