World’s largest advertiser cuts 90% of programmatic advertising spend
SUMMARY: The world’s largest advertiser is cutting back dramatically on ad networks and going back to traditional advertising. The result? Increased reach and decreased spend.
The world’s largest advertiser, Procter & Gamble, announced they cut digital advertising spend in 2017 by a whopping $200 million dollars. Halfway through last year, they had announced $140 million in cuts due to brand safety concerns: things like bot clicks and questionable websites showing up in their ad network buys. They continued the rest of the year.
What did they do with the money? Reinvested in areas with media reach, including TV. Chief Marketing Officer Marc Pritchard said the trend will continue. The result, Pritchard said, by going back to traditional media increased the reach by 10% and cut 20% of its ineffective marketing.
He said this past week at the Association of National Advertisers that he was pulling digital ads from several big players, some by as much as 50%. With all the talk of programmatic advertising buys being the wave of the future, it should be noted that much of the ad fraud and bots P&G cited from these ad networks are the reason why they’ve cut programmatic ad buys by 90%.
“The days of giving digital a pass are over,” said Marc Pritchard, Chief Brand Officer at P&G, at the IAB Annual Leadership meeting in February 2017. He’s mandating new requirements for digital agencies and media if they want to get a share of P&G’s ad business.
“It’s time to grow up. It’s time for action.” — Marc Pritchard, P&G via AdAge
Pritchard says P&G will no longer pay for any digital ads, ad tech, or suppliers that don’t agree to play by P&G’s rules.
“It’s going to stop unless you get validated, accredited third-party verification,” Pritchard said. Both Google and Facebook self-report data, and neither has full accreditation for all of its digital ad products.
The new rules (2017)
- Full transparency by the end of 2017 (Anybody think this happened?)
- Terms requiring funds to be used for media placement only
- All rebates disclosed and returned
- All transactions subject to audit
- Compliance with industry-standard viewability metrics*
- Fraud protection
- Third-party verification
* Ad impressions counted as viewable if at least 50% of the pixels are on screen for at least one second, video impressions for two seconds.
For P&G, the days of self-reporting ad tech appears over.
“Time is up. We will no longer tolerate the ridiculous complexity of different viewability standards” — Marc Pritchard, P&G via AdAge
EXCERPTS FROM RELATED ARTICLES:
Google loses accreditation for Viewable Impressions
You may have never heard of the Media Rating Council (MRC). It was established in the 1960’s as part of US Congressional hearing on accuracy of audience research. The MRC’s mission is to make sure the audience measurements being used by media are valid, reliable and effective. So when the MRC pulls its accreditation for Google’s DfP (DoubleClick for Publishers), it’s a big deal. DfP is used by the vast majority of publishers as the mechanism to serve ads across networks.
Facebook Ads are “far less viewable” than expected
Ever since Facebook admitted it had problems with key measurements, advertisers and agencies have been looking more closely at the metrics and what they mean. What they’re seeing is not that great.
Drew Heuning is the director of digital ad buying for Omnicom, one of the world’s four largest ad buying agencies. Speaking at a conference, Huening said “Facebook ads are far less viewable than people were expecting.”
How long does a mobile ad have to be on the screen to be counted?
Now anyone that knows me knows I’m a big proponent of digital advertising. When it’s done right, it works. When it’s coupled with other forms of media (like TV), it can do amazing things for businesses.
But seriously? Half the ad for one second? You’ve got to be kidding me. Try selling half a newspaper ad, or half the screen on TV to a business. Don’t forget, you can only look at it for one second!
The guidelines also talk about “Sub-Second Impressions.” That’s right. Ads that are on the screen for less than one second.