Shock at Publicis as P&G switches US media account to Omnicom

Shock at Publicis as P&G switches US media account to Omnicom

After over a decade of working with Publicis, Procter & Gamble has switched almost all of its media planning and buying for North America to Omnicom, according to a report published by The Financial Times.

The FMCG giant spent US$2.6 billion on US media last year, according to Kantar Media, and is one of Publicis’ top three clients – making the loss a heavy blow indeed for the French advertising firm. Analysts are suggesting that the loss of the account could cause revenues to drop by between US$50 million and US$100 million. “The psychological impact of a loss would be probably higher than the material impact on revenues and earnings,” Claudio Aspesi, a media analyst at Bernstein told The Financial Times.

Having put its North America business up for review in May, P&G claimed that the move was part of a wider strategy to consolidate relationships with advertising agencies. Omnicom will now handle the accounts for Head & Shoulders shampoo, Crest toothpaste and Tide washing powder, while Publicis’ Starcom Mediavest Group will retain the Duracell batteries business and account for P&G’s cosmetics, fragrances and salon professional hair care and color lines.  

“We’re trying to drive out non-working spending and funnel it toward spending going direct to the consumer,” Marc Pritchard, Global Brand Officer at P&G explained in an interview with The Financial Times. “Omnicom and Carat came out with what was a superior and proven performance in data analytics, planning, buying, innovation, talent and, of course, financial value. They’re going to give us better cost and spending on the services they provide and better value in the media they buy for us.”