P&G, which owns brands such as Fairy, Always and Pampers, is shifting its marketing spend away from Facebook advertising that targets specific groups of consumers after finding it did not always lead to the expected sales boost.
In an interview with the Wall Street Journal, Marc Pritchard, P&G’s chief brand officer, said the company took the strategy too far. He said: “We targeted too much, and we went too narrow. And now we’re looking at: What is the best way to get the most reach but also the right precision?”
P&G will not be cutting its total investment in Facebook and will still use targeted ads for some products, such as selling nappies to expectant parents.
“At P&G, we are focused on growing more users, and have continued to invest in both TV and digital media to reach consumers. Facebook offers both mass reach with precision targeting and our brands will continue to use Facebook to reach consumers, including targeting where it makes sense,” a spokesperson told Marketing Week.
The news comes after the FMCG giant revealed last week it is increasing ad spend amid falling sales. P&G’s results for the year ended 30 June show annual sales dropped by 8% to $65.3bn (£50.2bn).
Chief executive David Taylor said that in order to “restart” revenue growth the company needs to “get back to making consumers aware of its products and communicating their benefits”. It is doing that through an increased focus on sampling to generate trial among consumers.
“Reach and frequency is needed, along with the right message. We have adjusted our communications to TV, digital and any way appropriate to reach consumers, that can make a big difference,” he explained.
The targeting dilemma
The P&G approach is refreshingly old school. The plan is for reach among broadly defined segments with the aim of boosting sales. For a mass market brand like P&G, getting in front of as many consumers as possible is key. It needs to drive trial and consideration, so that when people are standing in a supermarket deciding on which toothpaste brand to buy, they pick a P&G brand.
“It can be tempting to think ‘we know who our audience is, we’ve done analysis and know the people who are going to respond best’. But it’s easy to go way too granular with that, and run the risk of eliminating people that may potentially buy your product,” says Alice Reeves, associate director of social media at digital agency Jellyfish.
Yet wastage is also an issue. That is why Reeves says marketers must test and learn what works.
“You can never guess how users are going to respond, which is why brands need to start small. If you are getting a sense that one particular demographic is responding better, you can then target them specifically in the second round of advertising. We would never recommend going straight in with niche targeting,” she comments.
Kevin McNair, Britvic’s GB marketing director, adds that tight audience targeting is right for some brands but less so for FMCG companies. Instead, data plays a bigger role.
He explains: “What’s key is that the right message is placed at the right time on the right channel, which is why insight and data is so important. Like with all channels we, as marketers, need to look at the return and decide if Facebook is a good fit.”
P&G believes pulling back from targeting to focus on broader reach is the right move for its business. And given its position as a market leader other marketers will inevitably look at whether their strategy on targeting versus reach is working for them.
Brands will ultimately have to find the right balance.
As Alex Smith, head of digital planning at media agency Maxus, concludes: “If more brands start to adopt the P&G approach, you would hope they don’t immediately jump to target everyone and think it will work. Targeting has to be balanced and unique to that brand.”