P&G slashes global adspend by $440 million in first quarter

LONDON - Procter & Gamble cut $440 million from its global marketing spending in the first quarter of 2009, equivalent to around 5 per cent of its advertising spend for the fiscal year to June 2008.

P&G... owns UK brand Fairy
P&G... owns UK brand Fairy

If the company continues to cut ad spending in this way, its marketing expenditure could fall to its lowest level in 15 years.

But despite the cuts, P&G has increased its media impressions by 5 per cent, due to the falling global media rates. 

AG Lafley, P&G’s chairman and chief executive, has pledged to continue to cut media costs through upfront negotiations.

"What we've tried to do is take our market-mix modelling and our market ROI analysis and figure out how to spend a little less money and get a lot more delivery," Lafley said.

Meanwhile, P&G’s organic sales for the quarter rose 1 per cent, falling short of its 4-6 per cent predicted goal.

Most of its growth was generated from pricing, which saw an uplift of 6 per cent, while its organic unit volume fell by 5 per cent.