The notion that you should keep advertising in a downturn (even if most of the shops are shut) hasn’t found many friends amid Covid-19 (the UK’s Johnny Hornby made the case recently although his old boss Sir Martin Sorrell said there was no point.)
Procter & Gamble has seen more such crises than most people have had Tide washes and it’s merrily advertising away, to good effect it seems.
In the first quarter of 2020 (its Q3) P&G increased adspend as a share of sales by nearly two per cent ($320m) and produced organic sales growth of six per cent. It also reduced marketing costs like agency fees by $120m. It’s forecasting a similar performance in the second quarter (which includes most of the lockdown in the US and other countries.)
While China sales fell eight per cent in P&G’s Q3, sales were up ten per cent in the US, six per cent in Western Europe, 11 per cent in Latin America and 14% in Canada. People have been buying lots of food and household products.
But another factor is cheap media time and space (and digital) as other advertisers have cut back. It’s not a course open to all advertisers – airlines and travel for example – but if you’ve still got sales it’s clearly a great time to advertise.