Behind The CPG Budget Cuts; UK Pubs React To Amazon's Ad Tech Plans

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Cut Your Losses

The world’s largest CPGs – including Procter & Gamble, Unilever, Mondelez, Nestlé and Danone – are slashing their marketing budgets, and digital ad outlays in particular. “We want our advertising to be seen by real people,” a P&G spokesperson told the Financial Times. “The impact of those cuts is rippling outward,” and right now it’s coming to agencies and consultants. “Not so good for the consultants but they can probably afford it,” Unilever finance director Graeme Pitkethly quipped during an earnings report last month. As a rule, investors like the cost cutting, but some are concerned about long-term market share losses if ecommerce companies and CPG startups win online. [AdExchanger coverage]

Smoke And Headers

UK publishers have concerns about Amazon’s server-side header solution, which it has been pushing in the region. Amazon has unique, high-performing demand, but some are wary of giving the company influence over supply and decisioning. “They need to figure out if they’re an ecommerce company with an ad tech platform or an ad tech company that’s owned by an ecommerce firm,” one publishing exec told Digiday. “Because if they’re a media-tech firm, that means they need to be totally agnostic with regards to demand, but they won’t give you a proper answer on that if you ask.” Although, would you call Google or Facebook totally agnostic with their media-tech empires? More.

Agency Slump

Havas delivered an earnings miss on Friday. Organic growth was negative for both the quarter (-0.9%) and the half (-0.4), and Havas is no longer able to confirm a growth target of 2-3%, said CEO Yannick Bolloré. He pointed to agency contract renegotiations as a source of margin pressure, as well as the zero-based budgeting trend that WPP Group mentioned on its investor call last week. Havas UK saw organic growth dip 7.1% in Q2 mainly due to Unilever cutting back on ad spend. One bright spot: Havas Media had a good year in North America, showing positive growth despite clients like IBM cutting spend. Read the results.

Winter Is Here

“Never since the rise of the printing press have two companies held such a monopoly over the world’s information,” according to John Snow, long-running presenter for the UK public service network’s Channel 4 News. Snow made the comments during the James MacTaggart Memorial Lecture (known for blunt media conversation) at the Edinburgh International Film Festival. “In the past we’ve had the guarantee of reach through our number four on the TV remote,” Snow said. Channel 4 News has 4 million hard-earned Facebook fans, but remains vulnerable to Facebook’s whims. “Many news organisations, including our own, have asked too few questions about the apparent miracle of Facebook’s reach.” Platform giants have enabled and reaped profit from fake news, regardless of ill intent, he said. And unlike other media companies, “Facebook’s principles are seldom explained in detail and can change overnight.” More at The Guardian.

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