P&G: We need to build stronger brand identities online

The FMCG giant is promising to up investment in its digital capabilities and is focused on search to make sure it turns up wherever consumers are.

P&G digital

Procter and Gamble (P&G) says it will increase investment in its digital capabilities, as it admits it needs to have “stronger” brand positioning online.

The FMCG company behind brands including Always and Gillette released its full year results today (27 July). Net sales stand at $65.1bn (£49.7bn), which is unchanged from the year before and includes a two percentage point impact from foreign exchange. Organic sales increased 2%.

Speaking on a results call, the company’s CEO David Taylor started by saying the company has been focusing on having higher ad quality standards by focusing on “brand performance claims”, and by looking at the creative talent within its agencies and production.

This, he said, links back to P&G’s new ‘Irresistible Superiority’ mindset, which means it wants to take a more holistic approach to its brands. And the hope is that as a result, consumers will see that its products are so good they don’t need to use any others.

“Exceptional brand messaging is advertising that makes you think, talk, laugh, cry, act and buy. And that drives growth in the categories in which we compete. It has been proven that effective ads such as ‘Like A Girl’ increase brand awareness and equity scores,” Taylor said.

It is also keen to react to changes in the digital sphere. P&G said it will do this by focusing on search and showing up in the right places such as Amazon or brick-and-mortar retailers’ websites.

“The online shopping experience demands executional excellence. We are committed to winning in this fast-growing segment,” he added.

Taylor claimed the business recognised that it needs to build “stronger positioning” for its brands online, which is why it is determined to up investment in its digital capabilities. He pointed to the ‘Skin Advisor’ app it launched for Olay as an example (see image above), which makes personalised product recommendations based on a consumer’s skin type.

“Digitisation helps improve the presence of our brands online, while digital search can help us identify changes and trends, and help us modify how we present our brands online,” he said.

Despite the company’s increased focus on digital, it actually reduced the amount it spent on online marketing in the fourth quarter of its financial year. That said, P&G’s CFO Jon Moeller claimed it did not impact the effectiveness of its ads.

“We were either serving bots or the placement of ads was not facilitating the equity of our brand. [We] put our money where our mouth has been to increase the efficiency of that supply chain, and we didn’t see a reduction in our growth rate. The spending we cut was largely ineffective,” he said.

“What we’d love to do working with our media partners is to create a very efficient supply chain that helps us build brands, and would love to invest more in doing just that.”

Like many other FMCG giants, P&G is determined to become a more streamlined business that is able to react quickly to new consumer trends. During the call, Taylor said it is much “better positioned to deal with a volatile world” as it has been focusing on increasing its agility as a company. Part of this has been driven by its focus on local markets.

He said there are “very few” global marketing roles, with the large majority of marketers residing in local markets. And there are plans to reduce the number of global roles even further.

He concluded: “[Our local teams are] leveraging unique local knowledge of consumers and competitors. This year we reduced corporate roles by 20% and expect to go further.”