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Is Advertising Ever Free?

Kerry Guard • February 8, 2012 • 2 minutes to read

Proctor & Gamble CEO Bob McDonald's recent comments regarding Facebook advertising being free lit up the phone lines amongst ad agency professionals.

To frame this conversation correctly, let me share his comment from the P&G Q4 earnings call:

"... with things like Facebook and Google and others, we find that the return on investment of the advertising, when properly designed, when the big idea is there, can be much more efficient. One example is our Old Spice campaign, where we had 1.8 billion free impressions."

Now, what Bob is referring to as 'free impressions' is the fact that the string of Old Spice videos generated views, shares, likes, etc, which he is quantifying as "impressions"

But the question remains: Were those really 'free'?

The short and sweet answer? No, they were not free. Here's why:

  • Production: At one point the star of the commercials, Isaiah Mustafa, was cranking out real-time responses to questions asked on the Old Spice YouTube channel. Who do you think was doing lighting, camera work, editing, etc etc the entire time? More importantly, who was paying Isaiah?
  • Agency fees: Running with the same example above, Wieden & Kennedy was driving the real-time response concept. Do you think that their creative directors, account management team, production team, etc etc works for free?
  • Measurement: With all the of the time and effort that went into the real-time response concept, how were they to figure out if it 'actually worked' or not? P&G needed a dedicated team of analytics pros to track all of the data and craft the story it was telling them. Bob McDonald was technically correct with his comment because he P&G did not pay any media costs to generate the 1.8 billion 'impressions'. But, there are always hidden costs involved in executing different promotional opportunities.

Make sure to speak with your agency about exactly how they are billing you to ensure that no costs are being swept under the rug as you cut them check after check every month.

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