The advertising and tech worlds suffered a collective cranial explosion early this week after P&G announced that they were pulling back on some of the more targeted Facebook ads they’ve been running to consumers.
Before examining the merits of what they’re doing, it’s important to think about what P&G is — a multinational conglomerate of household consumer packaged goods companies — like Tide, Febreze, Charmin, Downy, Bounce, and so on. Are your clothes, teeth, hair, face, or dishes clean? If you answered yes to any (or hopefully all) of those options, there’s a pretty good chance you’re a Procter and Gamble customer.
More importantly, P&G is the biggest advertiser on the planet. P&G spent $4.6 billion on advertising last year, which is $900 million more than the next largest advertiser, and more than twice as much as all but six other companies. Calling them a “bellwether,” like the Wall Street Journal did in their piece, is like using Michael Phelps’ times to judge a high school swim team.
Don’t get me wrong – what P&G is doing is really smart, if you’re P&G. If you run ads with broader targeting, you’re able to bid on more impressions, which pushes your costs down. Instead of targeting 20 million people and splitting your ads into 1,000 individual campaigns with small universes, you can be more efficient by targeting them as a collective with a general message. Let’s say each of the 20 million people visit five Facebook pages per day. Instead of bidding on each of the impressions as part of many different smaller audiences, you can bid on them collectively – but only if you’re willing to give them the same messaging and ad copy. Companies that have a consumer base wide enough to pull this off can, and should, do this. But those companies are few and far between.