Procter & Gamble is looking to rationalise its roster of media
planning agencies in Europe as part of its overall strategy to
streamline costs and revive profits.
The FMCG giant, which owns brands including Bold, Pampers and Sunny
Delight, is talking to its media agency networks from countries such as
Germany, Italy, Scandinavia and France. The review does not include the
P&G is keen to centralise its media planning functions, particularly in
the smaller European markets. Sources close to the company say it feels
that some of the media networks which it works with are not consistently
good across the European markets they work in, and therefore the level
of service is not as strong as it could be.
It is not clear if the company is looking at the possibility of
centralising into a single media planning agency, or simply cutting back
the roster of agencies it works with.
The agency networks it works with in Europe include Starcom MediaVest,
Zenith Media and MediaCom.
P&G, under its chief executive, Alan Lafley, has announced a series of
stringent cost-cutting exercises since 1999 as it sought to recover its
formerly strong market position. Lafley has been quoted as saying that
the company has a cost structure that is 20 per cent higher than its
closest competitors. P&G is looking to reduce its workforce by 15.8 per
cent worldwide and hopes to make cost savings of about dollars 600
million to dollars 700 million a year by 2004.