Consumer packaged goods mainstay Proctor & Gamble is now spending over a third of its U.S. marketing budget towards digital media, a dramatic shift that portends the further decline of traditional advertising media such as print or TV. The company's spending on online ads, social media, etc. ranges from 25% to 35% of its marketing budget across various markets, and the company is on the high end of that range for the U.S., its largest market.
P&G executives cited several reasons for the company's recent shift towards digital media:
- Faster
- Cheaper
- Quick feedback loop
- Consumers' increased consumption of digital media as compared to traditional media
On the last point, a P&G spokesperson commented, "The bottom line is we need and want to be where the consumer is, and increasingly that is online and mobile." The average daily time that consumers spend with digital media per day is expected to surpass TV viewing for the first time this year, according to research firm eMarketer, which estimates that the average adult will spend 5+ hours/day online as compared to ~4.5 hours watching TV.
In the U.S. overall, digital ad spending is expected to grow 14% per year to $41.9B, while TV ad spending is expected to grow at only 3% per year to $66.4B, according to eMarketer. P&G's move towards digital media is but one example of this broader trend.
Source:
http://on.wsj.com/19zRK0d (WSJ subscription required)
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