Largest Advertisers: What is your impact on sales and revenue?

While reading the latest AdAge magazine (December 4, 2017), I noted their listing of the worlds 25 largest advertisers. It is interesting to see this data. Understanding that the primary audience for this magazine is advertising agencies, I can understand why this listing is so juicy. It clearly outlines who is spending the most and money is being put on the table.

However, from a brand perspective, I see this list and wonder about the results of these expenditures (which happens to be missing from the AdAge report). I try to recognize that marketing and advertising should be closely linked to sales and revenue. With a spare half hour, I did a little comparison of revenue between 2015 and 2016 for the top 5 companies.

I was really hoping to see increased sales across each of theses companies. Unfortunately, this is not the case. Take a look at the results in the table below:

2016 total worldwide advertising spending (in $Billions) Net Sales 2015 Net Sales 2016 Difference Percentage Difference
Proctor & Gamble Co. $10.5 $43.9 $38.3 -$5.6 -12.8%
Samsung Electronics Co. $9.9 $184.6 $185.7 $1.1 0.6%
Nestle $9.2 $90.0 $89.4 -$0.6 -0.7%
Unilever $8.6 $62.7 $62.0 -$0.7 -1.1%
L’Oreal $8.3 $29.7 $30.4 $0.7 2.4%

So we have 3 of the 5 seeing revenue losses. This is a bummer. If my company is spending a this much on advertising, I want to see positive impact on revenue. These results are a chink in the armor of the advertising budget.

I say all of this with full understanding that market forces are very mysterious and no matter how great the marketing and advertising, every company is at risk of having a poor year.

My overriding point is that as marketers and advertisers, we need to hold ourselves to a higher standard. We need to be willing to stake our professional reputation on impacting sales in a clear manner. We need to hold our supporting agencies accountable to these expectations too.

As marketers we need to be living under the mantra of $1 put into advertising should be resulting in $2 back. Let’s get better at making this happen!