RSC Partners, Inc.

Today’s Wall Street Journal reports that two massive consumer products companies, General Mills and Kraft, are embracing Internet advertising and doubling their commitment to online media. While some would argue that they are late to the party, this news is significant for two reasons:

1. “Packaged-goods” companies like General Mills and Kraft have literally spent decades designing and fine-tuning their advertising models, and any deviation from those tried and true models is rare to unheard of. This fundamental shift in their approach is a strong validation of the claim New Media can make on today’s consumers.

2. The products these companies make and sell– paper towels and toothpaste, for example– are not well suited for e-commerce. People don’t tend to Google “paper towels” and they don’t typically buy tubes of Crest online. Therefore, to make this investment in online media now, makes a clear statement: “This is where they eyeballs are and this is where we need to advertise our products.”

John Galloway, a PepsiCo, Inc. Vice President bluntly told the Journal: “Our job is to invest where consumers are engaging with media.”

Kevin George, a brand manager for Unilever, echoed this sentiment: “Ultimately it comes down to where the consumer is.”

According to Menlo Park consulting firm Knowledge Networks, 15% of the time US consumers spend with all media, is spent online. Whether you are selling paper towels or advancing a corporate or public affairs agenda, that is a market that is just too big to ignore.

Once-Wary Industry Giants Embrace Internet Advertising [Wall Street Journal]