Procter & Gamble, the world’s biggest advertiser, has transferred the bulk of its North American media-buying and planning business into Omnicom Media Group (OMG), following its first review of the account in nearly 20 years.
OMG will handle media for the majority of P&G’s product categories from 1 July, while incumbent for consumer products, Dentsu Aegis Network’s Carat, will support the rest.
It represents a blow to Publicis Groupe’s Starcom Mediavest Group (SMG), the incumbent since the last review in 1997. Last week it also lost Honda’s pan-European planning and buying.
According to Ad Age, the P&G North America media account represented roughly 0.6% to 0.7% of Publicis’ revenue, at about $54 million.
However, P&G will remain one of Publicis’ largest clients globally and SMG continues to have media responsibilities for P&G outside of North America.
SMG will retain responsibilities for Duracell, as well as cosmetics, fragrances, salon professional and hair colour in the US and planning in Canada – all businesses that P&G is in the process of selling.
“What we’re trying to do is find the best partner help us really innovate in media and reach and attract more users to our brands with better precision and also greater efficiency,” said P&G global brand officer Marc Pritchard (right) told Ad Age.
“Integrating planning and buying responsibilities across North America and dividing media assignments by product category, as opposed to by region, will increase efficiency.”
Prior to the review, Omnicom did not have any of the P&G media business in North America. It has now been predicted that OMG will create a new media buying division to handle the new account, adding to its OMD and PHD agencies.
“Omnicom demonstrated superior and proven performance in the area of data analytics, planning and buying, innovation, talent and financial value,” Pritchard added.
P&G is reported to have spent approximately $8.3bn on global advertising costs between June 2014 and 2015, but it is unclear how much of this was spent on agencies.
The FMCG giant said in a statement: “This change will help us reach more consumers with better precision and greater efficiency to grow and create value.
“We are integrating planning and buying, and operating across North America markets to streamline operations and increase efficiency. And we will tailor media capability category by category to meet their unique business needs to more effectively reach consumers for their brands.
“We will see cost savings by simplifying our agency structure and negotiating new rates for the services our brands need today, and continue to reinvest to drive brand growth.”