P&G points the way with an increased use of digital media

Ian Darby, Campaign 24-Jun-05, 12:37

It might be a bit depressing, but where the likes of Procter & Gamble go, others will follow. So the report in The Wall Street Journal last week, revealing P&G is committing less money to buying TV airtime at the US "upfronts", will have worried many in the TV world and at ad agencies.

In the days after, P&G reconfirmed what it has been saying for a year or so now: that it is looking to put its marketing spend into the media that offer the highest return on investment. That may be TV, but increasingly it's also radio, direct and, of course, digital.

According to those who know, P&G is more than handy in terms of knowing what it wants from its digital creatives, planners and buyers. And there are plenty of others who are throwing money at the medium.

Last week's BT online planning and buying pitch, following i-level's decision to resign the account, carried a spend of £15 million; it was worth just £4 million when i-level picked it up in 2000. Alliance & Leicester revealed recently in Campaign's sister title Revolution that it is upping its online spend to £10 million a year.

Digital adspend is obviously growing - everyone knows this, but take a look at the latest Advertising Association figures for something close to the truth - but it's interesting to see how media agencies are trying to capitalise on this.

By the looks of it, many are getting their heads around it more quickly than ad agencies. There are increasing signs of traditional media agencies embracing digital in a more integrated fashion (see the Headliner on Initiative's Jerry Hill, page 9). Manning Gottlieb OMD, the UK's ninth-largest buying agency, likes to boast that it has more online buyers than TV buyers.

By comparison, it would be a shock if the ninth-largest creative agency, DDB London, had more online creatives than creatives working on traditional media.

Another agency that has really grasped this nettle is Media Planning Group, with its Media Contacts digital division recently landing the prized Camelot business and boasting digital billings of more than £30 million.

The specialist online buyers are still doing well - for instance, i-level recently captured the Orange and AA online accounts. This brought added stability to the agency and, potentially, will make it more valuable if it decides to sell.

Digital might be more cost-intensive for agencies to buy, proportionally needing more headcount per £1 million spent than TV, but agencies can charge clients more if they have the knowledge and specialist skills.

The tried-and-tested route for media agencies is to blend young digital talent with some older heads and skilled negotiators from "traditional" areas. More important, perhaps, is shaping an agency model that will be future-proofed against a constantly changing landscape - no easy task.