Sunday, March 18, 2012

P&G to Co-Innovate on Digital

If the path Procter & Gamble is pursuing in turning hard toward digital marketing is reminiscent of another recent, major strategic shift for the CPG giant, that's because company executives are deliberately borrowing from that model. More than a decade ago, P&G shook up the corporate world by opening up to outsiders for ideas for innovations in the products and features that make up its brands, in an initiative that came to be called Connect + Develop.
And now P&G is doing something similar for its digital-marketing push. "We want to leverage the knowledge and power of everyone we can" in accelerating investments in digital communications and marketing, Alex Tosolini, P&G's vice president of e-business, told brandchannel. Indeed, if members of the marketing and advertising community have "wonderful ideas" for digital plays, he said, "Please come to us and we'll be open to co-innovating with you."

Recent news that P&G plans to cut $1 billion from its annual marketing budget by 2016 quite understandably shook up the marketing world, especially because the company indicated it would be cutting back on its traditional strong advertising presence in pricey broadcast television. P&G's global brand building officer Marc Pritchard and CEO Bob McDonald have identified digital as an area where they would attempt to more than make up for marketing-budget cuts by being much more effective.
And one way to be most effective in the online milieu is to avidly welcome ideas for initiatives from everyone who thinks they might have something to contribute, including, for instance, ad agency execs who before might not have thought they would get a hearing from one of the world's biggest marketers.
"We want everyone to know we are open for business on digital marketing," Pritchard said recently at a digital conference in Cincinnati.
P&G sounded a similar theme several years ago to product developers, inventors and other entrepreneurs who believed they had an idea that could interest the company or one of its CPG brands. Previously, P&G had been one of the industry's biggest proponents of the "Not Invented Here" syndrome.
But under the philosophy and program that became Connect + Develop, over the last several years P&G has nurtured these outside connections to the point where about 50 percent of all innovation comes from outside the company.
A number of top-selling new products have emerged from relationships conceived and built by P&G's Connect + Develop operation, including Olay Regenerist, Swiffer Dusters, the Crest SpinBrush and Glad ForceFlex trash bags.

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