Challenge the Hype: Time Spent on a Channel Does Not Determine ROI or Effectiveness

Proctor & Gamble CMO Marc Pritchard famously told the digital ad industry to grow up last year, before announcing a massive scale-back in his company’s digital ad spend.

Pritchard cited the “murky, nontransparent and in some cases fraudulent supply chain” as the bottom line problem in the digital ad industry, speaking to NYT reporter Sapna  Maheshwari at an industry event.

“Ads showing up on objectionable sites, that’s bad,” Pritchard asserted. “Ads showing up to bots, through searching, that’s bad. Ads that you place that don’t really get measured by a third party that validates what’s right — that’s not so good, either. There’s a number of things in the digital media supply chain — even ads that aren’t viewable or close to viewable,” he noted at the time.

(Things haven’t gotten any better in the year-plus since he made those comments, with slumping consumer confidence in social platforms, data scandals, and a growing chorus of concern over the legitimacy of platform-as-news gatekeepers.)

Pritchard certainly had his critics and doubters; with consumers spending more time on smart devices than ever, how could any brand – let alone a high-profile one like P&G – afford to cut their digital spend and still reach their audience?

Turns out, most marketers seem to forget one simple thing: time spent on a channel does not determine sales, ROI, effectiveness or receptivity, explains Magazine Media 360.

The post refers to a graphic from Kleiner Perkins 2018 Internet Trends that shows the relationship between time spent on media and ad spend. Their data suggests a gap between time spent on mobile, and percentage of ad spend going to that channel, pointing out an  “opportunity” for advertisers to up their mobile spend.

That’s bunk, according to Magazine Media 360, for a number of reasons.

1. ROI — “This chart doesn’t address ROI or ROAS, (return on ad spend),” the article notes. “Nielsen Catalina Solutions data shows magazines leading all other media by large margins, beating all other media channels decisively.”

2. Viewability — This assumption ignores all the recent issues around viewability, ad fraud, brand safety, and ineffectiveness of digital ads, simply equating “time spent” with “good advertising potential.” 

“In the case of P&G, the world’s largest advertiser, CMO Marc Pritchard  said that the company reduced digital ad spending ‘with several big players’ by 20 percent to 50 percent, and the cuts helped P&G eliminate 20 percent of its ineffective marketing and increase reach by 10 percent,” the article continues. 

3. Consumer confidence – With consumer backlash becoming more vocal, magazine media remains their #1 trust source among media choices, according to the Magazine Media Factbook. They equate social media to “the ultimate skim,” with extremely heavy usage but little real engagement. 

If the time spent on that channel was deeply engaging – in the way that time spent with print magazines can be – then Kleiner Perkins’ assumptions might hold water. But real data just doesn’t support this idea.