Georgia-Pacific’s in-house media unit is doubling down on audio streaming

Georgia-Pacific is set to  “double or triple” its investment in Spotify and Pandora over the next three years, Bustillos told Digiday. At the same time, he estimates that its eight-person in-house media team, which manages an annual digital media investment of $30-$50 million across its entire portfolio, had increased media cost efficiencies by 25% compared with its previous agency arrangement — a result stemming, he said, from a combination of absorbing agency staffing costs, forging direct relationships with DSPs and cutting the number of adtech vendors it deals with.

“Streaming audio is growing in penetration with consumers. Time spent with streaming audio is growing,” said Bustillos, who declined provide a breakdown of the company’s media mix. The company’s brands, which span toilet paper, dining napkins and office paper, include Angel Soft, Blue Ribbon and Brawny.

The firm began testing with the channel in 2022, and plans to scale its audio media investment across the entire Georgia-Pacific portfolio this year. 

Though Georgia-Pacific is not the only advertiser increasing its investment in streaming audio, it’s less typical to find an in-house shop dabbling in newer channels, said Mediasense’s Ryan Kangisser.

The same impulses that lead to advertisers to in-house their media operations can obstruct experimentation. “They have small teams, they’re quite isolated,” he said. “We tend to see a lot of in- house teams kind of stick to what they know and just try and do the basics really well,” Kangisser added.

That’s not to say Georgia-Pacific hasn’t been pursuing a lower-cost operation. In 2019, the Atlanta–based company – which, until that point, was working with Publicis agency Zenith – began moving media operations in-house in pursuit of the lower cost media buys.

“We saw improved effectiveness in our digital media as well, just by having more control over campaign setup and optimizations on a regular basis,” said Bustillos. 

Since then, it’s begun to cut down on the number of adtech vendors involved in its media supply chain and deal directly with demand-side platforms (DSPs) such as Google’s DV360, The Trade Desk, Yahoo and Amazon. Combined with the cost benefits of employing media expertise directly, Bustillos said the team has achieved “lower CPMs and higher effectiveness vs. the agency model we had before.”

In addition to scaling up its investment in streaming audio, Bustillos said it was due to double the portion of its media budget that goes on paid social, by shifting spending away from other channels, though the marketer declined to provide more precise figures. Though the firm focuses on Facebook, Instagram, Pinterest and Snapchat, it’s the video platforms such as TikTok and especially YouTube, that are drawing focus from Bustillos’ team. 

Furthermore, it’s been increasing its retail media investments, following an experimental period when its team tested over 40 retail media networks, before settling on seven key partners  including Amazon Advertising, Walmart Connect and Kroger Precision Marketing. Bustillos said the firm tries to apply the same experimental method to any new channel it’s looking at.

“We set aside separate investment for experimentation. We do it at a small scale, first, probably with one brand, one platform within that media channel,” he said. “Once we get the results it’s seamless to make a decision about either scaling that investment, stopping it, or optimizing and continuing to learn.”

Though it manages its digital marketing budget, linear and CTV are still handled by OMD, its media agency since 2021. Bustillos said his team had tested their ability to bring even those reserved areas inside, but found the Omnicom shop were able to do it for a lower cost. 

“There are benefits [to] the scale of a media agency when they’re buying linear and connectivity together as part of the upfront process,” he explained.

According to Adam Cleaver, founding partner at Collective London, a digital agency that provides in-housing services to brands, that hybrid approach can furnish advertisers with “the best of both worlds.” It means advertisers can pursue cost efficiencies and control of their media and creative investments without ending up cordoned-off from the outside world.

“It’s dangerous to just expect all that knowledge to just be pushed into the in-house agency,” he said. “There is a lot of tacit knowledge that the agencies bring … it’s important to retain an element of that with a retained agency, even if you are thinking of in-housing.”

Greg Kirby, global head of growth, digital media at Monks, agreed. “Five years ago in-housing had a connotation all in or all out, when what’s right for brands ends up being somewhere in the middle,” he said. “Brands that have in the past, perhaps committed to a more isolated model that excludes agencies altogether, run the risk of finding themselves in a bit of an echo chamber.”

Bustillos suggested the hybrid approach was one that would remain settled for Georgia-Pacific.

“Even if we bring more channels in-house, I still believe there is a role for the media agency in terms of bringing thought leadership, media innovation, strategic thinking, and helping to think about what the future of the media industry is going to be,” he said.