Corporate America’s Switch to Digital Marketing: A P&G Story

For those of you as yet unconvinced of the power of digital marketing, here is a case study highlighting how one of the largest companies in the world, Proctor and Gamble (P&G), transformed their advertising and marketing focus to digital in less than two months.

JANUARY 30th, 2012

An excerpt from an article in Social Business Today:

Reality appears to have finally arrived at Procter & Gamble, the world's largest marketer, whose $10 billion annual ad budget has hurt the company's margins.

P&G said it would lay off 1,600 staffers, including marketers, as part of a cost-cutting exercise. More interestingly, CEO Robert McDonald finally seems to have woken up to the fact that he cannot keep increasing P&G's ad budget forever, regardless of what happens to its sales.

He told Wall Street analysts that he would have to "moderate" his ad budget because Facebook and Google can be "more efficient" than the traditional media that usually eats the lion's share of P&G's ad budget.

 In that same analyst call McDonald, when pressed, conceded to the utility of digital marketing:

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.

MARCH 12, 2012

An excerpt from a recent post on P & G’s Official Blog, entitled, “A Real-Time Demonstration of the Power of Digital. Signal P&G Features Distinguished Digital Leaders, Becomes Global Trending Topic:”

Last week, the sunny Silicon Valley descended on our rainy Cincinnati Headquarters for Signal P&G — a one-day conference organized by Federated Media focusing on brand building in a digital world. The format followed the same rapid, staccato-like rhythm we’ve all come to expect from social media with quick, thought-provoking interviews and case studies from some of the most iconic digital leaders in the world.

They’re not kidding. John Battelle, co-founder of Wired magazine, was the MC. A few of the high-profile speakers in attendance included Twitter CEO Dick Costolo, Facebook VP David Fischer, and Yahoo! Chief Product Officer Blake Irving- a veritable Who’s Who of Digital Tech…

The blog post continued:

Our Global Marketing & Brand Building Officer Marc Pritchard (shown above) began the day by telling the audience: “Today is not about digital marketing; it’s about brand building in a digital world,” which set a resounding tone for the role he wants digital to play for P&G. He went on to  make it clear that digital is no longer a trendy use of technology for  technology’s sake, but it’s the way P&G will engage with people in real-time  to build brands like never before.

Pritchard’s comments reflect an critical thought process marketing execs need to follow before they will embrace digital:

Accepting the relevance of technology for marketing: digital is no longer a trendy use of technology for technology’s sake…Connecting time-tested marketing practices with technology: it’s about brand building in the digital world…Recognizing the power of digital technology for consumer engagement: it’s the way P&G will engage with people in real-time to build brands like never before…

The blog post then brought in CEO McDonald’s perspective:

Our Chairman of the Board, President and CEO Bob McDonald followed with a candid and transparent  conversation with Battelle, where he further emphasized the urgency of being agile and responsive in the digital age. But most importantly, he  openly gave the organization permission to fail early and fail well in digital,  citing mistakes he’d made early in his career that taught valuable lessons he still carries with him today.

Sounds like P&G is going all in on Digital Marketing.

The post finished with a summary of how P&G used social media very effectively to promote the event:

Tweets leading up to the day seeded the #SignalPG hashtag as an identifier for the event, building momentum and interest before it ever  began. Then during the day, hundreds of P&G employees watched by webcast, while thousands outside P&G followed the hashtag on Twitter and viewed backstage video interviews via the @ProcterGamble Twitter feed and  Facebook page.

With the help of the hashtag, buzz about the event reached a tipping point on Twitter just two hours into the conference. Live and virtual audience members generated more than 3,500 tweets with more than 14 million impressions, making the relatively small 400-seat gathering the epicenter of a worldwide.

TAKEAWAY

There you have it. One of the largest corporations on earth went from old school to cutting-edge digital marketing in the span of six weeks.

Aside from the obvious props you have to give McDonald, Pritchard, and the rest of the executive leadership for deftly evolving at a critical time, P&G’s story highlights three important takeaways for business leaders great and small as we all grapple with the implications of our fast-moving digital age:

Companies must recognize that digital technologies like social media, mobile devices, and online commerce are not just a fad, they are fast becoming the future of marketing. Period.In this new digital marketing landscape, the rules of consumer engagement have drastically changed. Marketers can no longer talk at, cajole, or otherwise manipulate a passive, disengaged consumer. The rise of the Internet, social and mobile has shifted the power to the consumer, who is relying on things like user-generated content to make purchase decisions. The consumer is now calling the shots. They will decide when and with whom they will engage on their schedule.Companies must focus their efforts on building transparent, real-time engagement with consumers, offering online content and messaging that helps resolve the wants, needs, pain points, and desires of their target audience.

As a business owner or executive, you need to view these changes as a good thing. P&G's experience underscores how digital marketing technologies such as social media can give your company an unprecedented opportunity to amplify your message, expand your reach, and engage your target audience on a deeper level. These practices allow you to operate more efficiently and cost-effectively than ever before. 

Finally, digital marketing practices such as inbound marketing generate leads and sales, oftentimes quicker than you would imagine.

So what’s holding you back? If Old McDonald can do it, so can you.

View the original article here

Posted in: Americas, Corporate, Digital, Marketing, Story, Switch