Tuesday, April 8, 2008

P&G challenges in interactive and digital marketing

Currently attending a great presentation by P&G's Michel Lambert who is telling us about challenges and achievements in interactive and digital marketing. With an experience of 20 years in marketing 9 of which at pan-European level, a strong background in direct marketing, having gone through the great school called P&G and basically a combination of analytical capability and common sense, he's got a contribution to make.

In fact I was lucky to meet him yesterday and I was impressed with the stuff he told me about how P&G is clearly putting a great emphasis on interactive and digital factors throughout their organization, not only in the field of marketing. He clearly gets the transformative power of information technologies in the field of communication as well as in all the processes of any company that wants to be successful in the coming century. Michel does have a good and no-nonsense grasp of the ways in which organizations need to transforms their structure, practices, approaches, ways of assessing success versus failure, recruiting, building relationships... In fact it's quite impressive. While I prefer to respect a degree of confidentiality, I think the presentation of today reflects very well the state of play at P&G's end and this presentation certainly looked like a call to agencies to finally start offering stuff that make business sense rather than just surfing on the latest online fad and fashion.
Michel has a non nonsense approach: "is my brand prospect and brand customer online? Sure. But what do they actually do there? how can I understand them better?". His take is that the consumer, the person that is potentially a customer, the complex individual should be at the center of every single thought people  have about interactive and digital marketing. Platforms, tools, communities, practices, plugins, widgets... will proliferate and they are not really relevant if one does not understand the consumer.

Here are some of the very interesting things Michel shared with the audience today:

  1. understanding the on-line behaviour in fine detail: motivations, participation, influencers, self-expression, context rlevancy, how they search, what are their expectations from search, why are they searching, where are they searching...

  2. take a more strategic view on things: define roles and make choices. Here key performance indicators are key of course since they eventually feed back into the formulation and execution of strategy

  3. how do you actually build valuable and intense relationships with people: the magic of relationship marketing

  4. generate content or leverage existing content?
    • we compete for an audience, for the attention of people. So our competitive set includes media and entertainment

    • calls for production of higher quality of conten

    • why don't I invest in mobile marketing? There is no usable content!"

  5. Risk taking
    • culture of data and measurement. Gut feeling is not really the core
      strength of P&G: if an ad does not test well in pre-release it will
      not be aired. Online things are considerably more difficult and require
      more risk-taking

    • risk taking needs to be managed in new ways and in particular by doing more iterations and working on shorter cycles (one year is an eternity online)

  6. Cost of reach is too high right now.
    1. There is no way in the
      world P&G will invest crazy amounts to go full steam ahead with a
      pan-European campaign without understanding the ROI and how the
      campaign fits into a broader five-year strategy

    2. clear directions, reach goals and glide path: it may be possible to
      achieve results in year one simply because there was nothing before,
      but results in future years come only at the price of having a
      disciplined approach, not by throwing good money after bad. Back to
      basics again.

  7. the challenge of mass individuals
    • consumers are in control

    • consumers want proximity and a relationship with the brand

    • segmented advertising vs one-size-fits-all even though offering a
      relationship on an individual basis is not an option because it costs
      too much and drives ROI down the drain

    • agencies should support brands in achieving mass customization in
      the relationship with their consumers and prospective customers

  8. the sweet spot of balance between tools and approaches
    • starts
      with the consumer and drive scale from them, not from tools: e.g. in
      search and keyword advertising if I don't understand my consumer I end
      up translating ad keywords on a global basis on various platforms!

  9. growing importance of retailers as media
    • retailers are
      increasingly building relationships with consumers  in particular by
      exploiting their huge databases and by developing content

    • P&G could develop a relationship with retailers considering
      them as media, but they need to develop missing capabilities in
      particular to assess the financial value of each contact

    • out of 25 retailers surveyed only one had proper online
      capabilities to achieve that. Quite frankly this is a shell-shocking
      picture! That's some potential business quest for someone in the field
      and with access to the decision makers of top retailers.

  10. the need for constant optimization
    • in traditional media: concept
      test, develop content, pretest, go on air, wait to get results, plan
      for next year. The cycle is therefore one year. In the digital world,
      the cycle is much shorter and analytical skills are in very short
      supply in-house

    • transform pre-test into post-optimization: a complete shift in the
      mindset and probably one of the biggest challenges P&G is facing

  11. integration
    • how do we integrate different platforms and media? how does the mix work together?

    • understand the relative ROI because the budget will not increase;
      in fact, it might even decrease. If there are more ways to execute a
      marketing strategy, then the money must be shifted from somewhere. New
      media need to prove the case and a better collaboration between online
      and traditional, between search and influence, between interactive and
      non-interactive... That's a key challenge

Michel also mentioned education of people inside P&G as being a major area of focus today because marketers need to reassess many of the practices they used to consider as world-class. Furthermore the relative differences between markets makes it necessary to have a decentralized approach and in that respect the world is very far from being as flat as Friedman tends to suggest. The world has changed in a major way.


  1. Its important for the retailers to build relationships with consumers in particular by exploiting their huge databases .

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