P&G says ROI is decreasing and calls on the Japanese media industry to stand by its principles for media transformation

Proctor and Gamble (P&G) extends its media transformation call to Japan

P&G has taken its war horn-like rallying cry for media transformation to Japan, a market that was plagued by issues around transparency and ad overcharging last year.

Speaking at Advertising Week Asia last week, Stanislav Vecera, president, representative of Procter & Gamble Japan, drilled into the message started by the FMCG giant’s CMO Marc Pritchard, who revealed a four-step plan in January to gain transparency in its media supply chain.

Vecera said the brand’s return on investment (ROI) into media was decreasing and that media complexity was to blame.

“It is important to look at the ROI of advertising and nowadays we see ROI decreasing and it’s very concerning. We see the money put into media is actually not getting returns. We encourage every one of us to put our business hat on because it’s cool and nice to create some great ads and messaging, but it needs to deliver business objectives,” he said.

“If you look at what’s happening, the current media landscape is very complex and the media supply chain is fragmented. There are lots of companies and agencies and sometimes for an advertiser it is not transparent enough. The whole chain is too complex and it creates potential risks in the media industry, so if I would say what I would expect simplicity and basics: focus on reach, which is critical, and target audience. Then focus on effectiveness and efficiency, so the ROI. Sending a message at any cost won't work, so we need to reduce complexity and focus on end-to-end, which is visibility from the time that we create ads and know where the ads are going, to then seeing the efficiency and effectiveness,” he explained.

The interview was held in Tokyo, Japan, a market hit by significant transparency scandals last year. Dentsu specifically hit the headlines after it emerged it had overcharged clients and had to pay back almost $2.3m.

Vacera to called on the industry to work together to create a better ecosystem, defending P&G’s hard line on the principles it is enforcing on agencies and partners.

“We have very strong principles and values and we won’t break or compromise. We would rather not advertise and not allow ads to be put on wrong sites. It is a strong message but it is fundamental for media transformation. It is an example of doing hard things right, rather than the easy things wrong and I would request the leadership of this room to have same standards. Have a zero tolerance, it’s so important and help us to continue to evolve digital transformation. We can together develop a better way of delivering messages,” he said.

But it wasn’t all negative, he referenced industry initiatives such as the Trustworthy Accountability Group (TAG), which is predominantly active in the US and UK and not Asia, as the right way to tackle the clean-up of the digital supply chain.

He concluded that for Japan, the Tokyo 2020 Olympics was a milestone event that could be used as a point to strive for a better media landscape and a big opportunity that the market should be excited about.

Get The Drum Newsletter

Build your marketing knowledge by choosing from daily news bulletins or a weekly special.