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Leading Consumer Goods Vendors Decide To Less Promptly Pay Advertising Agencies And Other Suppliers

May 30, 2013: 12:00 AM EST
Several of the world's leading consumer goods companies are extending their payment period for advertising agencies and suppliers for up to six months. Kraft's former snack food unit, Mondelez International, is adopting a 120-day payment term from July 1, 2013. Procter & Gamble informed its suppliers that payment period will be extended from 45 days to 75 days, which follows similar moves by Johnson & Johnson and Anheuser-Busch InBev. This move by the large corporations signals other marketers are likely to follow, according to American Association of Advertising Agencies chief executive officer Nancy Hill. Pivotal Research advertising analyst Brian Wieser said social media is to blame for this power shift in marketing. Social media has enabled marketers to directly engage with consumers, added Wieser.
Andrew Edgecliffe-Johnson , "Consumer giants turn screw on ad agencies", Financial Times, May 30, 2013, © The Financial Times Limited
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