Back in January, Proctor and Gamble kicked off the New Year with a shocking announcement for marketers.
With a flat market share and under pressure from investors, the administrator of the world’s largest advertising budget announced it was eliminating 1,600 non-manufacturing jobs – many from the marketing department – and shifting to digital only initiatives “to contain media spending long-term.”
P&G Chairman and CEO Bob McDonald:
“In the digital space, with things like Facebook and Google and others, we find that return on investment of the advertising when properly designed, when the big idea is there, can be much more efficient.”
Interestingly enough, McDonald continued by pointing out that digital media’s largely free social distribution options could significantly drive down costs for the CPG manufacturer, citing the over 1.8B free impressions garnered by its break through “The Man Your Man Could Smell Like” campaign for Old Spice from 2010.
Many media theorists and market watchers know that digital isn’t really free despite what some execs profess. What’s important about McDonald’s statement is the indication that marketing executives view digital as a cost-saving channel powered by shared media and that is a job killer.