Procter & Gamble, radio’s premier advertiser, grew its ad spending substantially in its fiscal fourth quarter, even though its 2% topline organic sales growth fell short of expectations.
P&G, noting what it called a “marketing reinvestment,” increased quarterly ad spending by about $600 million vs. the year-ago period.
The company’s prodigious appetite for radio advertising is reflected in the latest spot count from Media Monitors. For the week of July 22-28, 2024, the company ran more than 162,000 spots — vastly outpacing all other advertisers — promoting more than a dozen products like Downy, Swiffer, Febreze, Olay Body Wash, Gain and Old Spice.
According to a report by Ad Age, P&G has no qualms with its marketing spending and says it’s getting plenty of bang for the buck.
“We’re happy with the payout that we’re seeing in the markets where we can read the payouts cleanly,” P&G Chief Financial Officer Andre Schulten said, referring to North America and Latin America.
Added Jon Moeller, P&G’s Chairman and CEO: “We’re trying in an effective way and the most efficient way we can to increase reach so more consumers are aware of our products and the benefits we provide them. We’re still on the incline curve on that right now. It takes some time.”
Schulten highlighted the challenge of comparing this quarter’s performance to the 7% organic sales growth achieved in the same period last year. A significant contributor to the decline was the share loss in the baby care sector, primarily due to underperformance by P&G’s leading brand, Pampers.
The diaper division experienced a 1% drop in organic sales, which the company attributed to reduced demand and a decline in market share for the Luvs brand. Schulten said the launch of the new Luvs Platinum diapers was postponed this year due to production capacity constraints.
On the earnings call, Schulten noted that P&G met or exceeded all of Wall Street’s ongoing guidance for the year, with “85% of the business performing right in line with expectations.” This performance included a 4% volume growth and market share gains in North America.
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