Facebook, Twitter and P&G

This afternoon I attended an event sponsored by Proctor & Gamble called the "Innovation Outreach Venturing Day." The event was an effort by executives at P&G to connect with the investment community in the Bay Area to discuss how P&G might work more closely with the emerging technology companies we all touch every day. The pre-amble to the event was a run down of the scale of Proctor & Gamble's business and the massive amount of technology they already leverage. The scale of P&G is pretty stunning -- P&G has 32 separate brands that do more than half a billion in revenue annually (and more than half of those do more than a billion). The company has 135,000 full time employees and did nearly $80 billion in revenue last year. In other words, Proctor & Gamble is freakin' huge.

And because of their scale, P&G already leverages massive amounts of technology. When talking about social media platforms, they mentioned that they already have more than a dozen in trial within the enterprise at the moment, and they continue to assess more. They have looked at every knowledge management system you can imagine, and continue to assess more. They have worked with every digital agency on the planet, and continue to assess more. What is interesting, however, is that one thing they aren't trying are cloud services. It was made clear that P&G runs everything behind their own firewall. And they have no intention of moving any part of their infrastructure into the cloud. P&G's view of the enterprise is pretty old school.

But when it comes to advertising, they clearly understand that they need to be more forward thinking. They aren't discounting television by any stretch. The continue to spend hundreds of millions of dollars in television advertising. But, as they say, P&G needs to "bring the experience to where she already is" (the folks at P&G always talk about "she" and "her" when discussing their customer) and they know that these days that is online. So they are working hard to have a big presence in digital media.

That said, Proctor & Gamble's online bets tend to be around huge aggregations of traffic, like Yahoo and Google. It was particularly interesting to see how bullish they are on Facebook. In a small group discussion about social media, one of P&G's technology leaders talked about Facebook's growth trajectory and how they are on a path to serve 5 billion people. Accordingly, P&G feels that it needs to have a significant presence on Facebook. If you are wondering if Facebook is making any money, you need look no further than P&G. It is clear that Proctor & Gamble is working with Facebook in a big way -- as an advertising platform and a brand destination. P&G's explicit goal for 2010 is to assure that each of its brands has a meaningful presence on Facebook and they are willing to pay dearly for that. And while P&G's thought leaders expressed some skepticism about the efficacy of Facebook's "engagement ads," they certainly view Facebook as a must-have for digital advertising and brand building. They didn't quantify what they are paying for that exposure, but it is quite clear that the numbers are very big.

Perhaps as interesting as P&G's love of Facebook, was its skepticism about Twitter. They described Twitter as "much more like television than one might think." To P&G, Twitter is a great broadcast medium -- it is best for one to many communications that are short bursts of timely information -- but as good as it is for timely information, the P&G folks do not view it as particularly relevant to what they are doing on the brand building and advertising side. For those things that Proctor & Gamble thinks are most interesting and important, they do not believe that Twitter will ever approach the value they can get out of a Google or Facebook. But they are open to looking at other alternatives that will have more of the engagement and brand building attributes that they hope to exploit in Facebook.

It was fascinating to get a bit of a view inside such a huge and influential company as Proctor & Gamble. And it is encouraging to see them reaching out to the greater tech community. In fact, P&G is opening an innovation office in the Bay Area and they've committed to have their senior execs make more frequent trips out to what they view as the "most important innovation ecosystem globally." It will be great to continue the conversation. There's no question that it will benefit P&G and Bay Area startups alike.

UPDATE: As you can see in the comments below, a representative from Proctor & Gamble wants to clarify that P&G does not now claim that they project Facebook's growth to 5 billion users. Rather, they are projecting the reach of their own products to 5 billion users. Since the growth projection that I heard at the P&G event wasn't attached to any time frame, I took it simply as a statement of how huge Facebook could become over time. And I agree. Facebook will be increasingly huge, and increasingly important, over time. So it didn't strike me as such a controversial statement. That said, Proctor & Gamble would like me to correct the misunderstanding, so please let it be known that if Facebook, in fact, reaches 5 billion users some day in the future, P&G did not project that that would happen :)

Comments

[https://me.yahoo.com/a/t5OzlXoU393GwglGu3uDfxhd47kbGjdR#e2ac6]

David, I happen to agree with P&G about Twitter and think TV is a good analogy. Like TV, most people are tuned out when blowing through Twitter updates. It's much more one-way than interactive.

I'm interested to know what particular brands P&G hopes to strengthen via Facebook. And what aspects of the brand? Depth, Awareness, Breadth?

It'll be interesting to see what P&G does. Very smart company.

[Jim Cook]

atta boy Hornik...great way to re-start your # of postings and your valuable insight. Keep it up! Best post I've seen from any of the 28 in front of you for a long time. Maybe they should start keeping a "quality" vs "quantity" scorecard?

[sproutinc.wordpress.com]

For those interested in learning more about P&G's social media work, check out Deborah Schultz on Feb. 4th when she presents at the Building Brands on Social Networks event in San Francisco. The event will also include other social media though leaders. You can learn more and register here: http://sproutinc.eventbrite.com/

Here's some background on Deborah: she consulted with Procter & Gamble where she architected the P&G Social Media Lab to study the impact of the social web on customer relationships and the business benefits of "open innovation." She continues as a member of P&G's Digital Advisory Board.

[https://me.yahoo.com/a/M9Pla3lrrOwqD81ykuVS0oPkDHaaNc5m#eaf5f]

Hi David – We're glad you found the session interesting, but I think there's a misunderstanding about the number of people P&G expects to reach on Facebook. P&G's stated goal is to serve 5 billion people with our brands globally - up from the 4 billion we serve today. We didn't intend for a number to be associated with another company's potential growth. We do see digital communication platforms as one of several ways to help achieve our goals. Thanks again for the interest – Tressie - P&G External Relations

[david3point.myopenid.com]

Interesting comment about P&G's view of cloud computing. As cloud watchers ourselves, we anticipate most, if not all, will soon move to the cloud. Would like to have more insights into P&G's reluctance to embrace what appears inevitable.

[Brenda Kidd]

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Procter And Gamble The Team And Members Discussions On The Website
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[ac adapter]

Facebook will be increasingly huge, and increasingly important, over time. So it didn't strike me as such a controversial statement.

[gucci handbag]

I hope you have a nice day! Very good article, well written and very thought out. I am looking forward to reading more of your posts in the future.winni2078

[gucci bags]

We do see digital communication platforms as one of several ways to help achieve our goals. Thanks again for the interest � Tressie - P&G External Relations.

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I can about the dangerous drug namely, Actonel. Unless someone out there has a better idea.