How P&G Uses AI and Data to Dominate a Fragmented Media Landscape

The Situation

Procter & Gamble is facing a fundamental shift in how consumers shop and how retailers operate. The traditional advertising playbook no longer works in a fragmented media environment where attention is scattered across countless channels, platforms, and retail touchpoints.[2] In response, P&G's new leadership is doubling down on two competitive advantages: massive consumer data and artificial intelligence.

During its fiscal Q2 2026 earnings call, P&G reported net sales of $22.2 billion—up just 1% year-over-year, with particular softness in the U.S. market.[2][3] Rather than panic, executives outlined a strategic pivot: instead of relying on traditional media buying and broad-based campaigns, P&G is building an integrated system that connects consumer insights, product innovation, marketing, and retail execution through AI-powered tools.[3]

The Breakdown

The Data Advantage

P&G's competitive moat isn't just scale—it's information. The company has built what executives call an "enormous wealth of consumer data" that extends far beyond traditional market research.[2] This includes:

• Product and shopper research
• Social media posts and brand fan websites
• Real-time retail demand signals
• Decades of historical campaign performance data

This data feeds into a structured "data lake stocked with petabytes of relevant data," which serves as the foundation for AI-driven decision-making across the organization.[3]

AI as the Operating System

P&G isn't using AI as a one-off tool—it's embedding AI throughout its entire marketing and operations infrastructure. The company has deployed AI-enabled systems for:[3]

• Media creation: Generative AI tools that produce and iterate copy, audio, and visual assets for A/B testing
• Shelf optimization: AI that analyzes retail environments and recommends product placement
• Supply chain responsiveness: Systems that react faster to retail demand signals
• Ad testing and optimization: Proprietary platforms like AI Studio that analyze new creative against decades of performance data, reducing optimization time from weeks to days and cutting costs by 90%[4]

Brands like Pampers and Tide now test and optimize over 140 different ad units per year through these AI systems, resulting in double-digit sales increases.[4]

The Retail Media Pivot

P&G recognizes that retailers have transformed from merchants into media platforms. Amazon, Walmart, and others now generate significant revenue from advertising. P&G is repositioning to capitalize on this shift by:

• Treating retail media as a core channel alongside traditional TV and digital
• Using data to create hyper-targeted, personalized campaigns within retail environments
• Emphasizing premium product performance in e-commerce, where consumers show willingness to trade up in categories like hair care and skin care[3]

The Timeline for Transformation

P&G's new CEO Sundar Jejurikar acknowledged that full integration of these capabilities will take 12-18 months, with some business units moving faster than others.[3][10] The company is building a closed-loop system where consumer insight, product development, brand messaging, and in-store/online execution work together seamlessly.

Why This Matters

For business owners and marketers, P&G's strategy reveals several critical truths about the future of marketing:

1. Data is the new moat. Companies that can aggregate, organize, and act on consumer data faster than competitors will win. P&G's "petabytes of relevant data" aren't just impressive—they're a strategic asset that smaller competitors cannot easily replicate.

2. Speed is a competitive advantage. By reducing ad testing from weeks to days, P&G can iterate faster, learn quicker, and respond to market opportunities in real time. This compounds over time: more iterations lead to better optimization, which drives superior performance.

3. Fragmentation requires integration. The old playbook of buying broad media and hoping for reach no longer works. Success now requires connecting product innovation, consumer insights, marketing, and retail execution into a unified system.

4. Retail media is not optional. If you're not thinking about how to reach consumers through retail platforms (Amazon, Walmart, Target, etc.), you're leaving revenue on the table. These channels are where purchase intent is highest.

5. AI is infrastructure, not a feature. P&G isn't using AI for one campaign or one function—it's building AI into the operating system of the business. This is the direction the industry is moving.

Action Plan

1. Audit your data sources. Map out where consumer data lives in your business—CRM systems, website analytics, social media, customer feedback, sales data. Identify gaps and consolidate where possible. You don't need P&G's petabytes, but you need organized, accessible data.

2. Identify your highest-leverage retail media channels. Which platforms do your customers use to research and buy? Amazon, Walmart, TikTok Shop, Instagram Shopping? Prioritize the 2-3 channels where your audience is most active and test campaigns there first.

3. Start small with AI-powered testing. You don't need a proprietary platform like P&G's AI Studio. Tools like Google Ads, Meta Ads Manager, and third-party platforms now offer AI-powered creative testing and optimization. Run A/B tests on ad copy, visuals, and messaging to identify what resonates.

4. Build a feedback loop. Create a system where campaign performance data informs product development and messaging. If certain product features or benefits consistently outperform in ads, double down on them in product innovation and positioning.

5. Invest in integration. Don't let marketing, product, and sales operate in silos. Create regular touchpoints where these teams share data, insights, and learnings. This is where the real competitive advantage emerges.

Toolkit Recommendation

As you scale your data and AI capabilities, you'll face a critical question: Which markets and niches should you prioritize? P&G can afford to test across dozens of channels and segments. You need to be more surgical.

Stop guessing which niches work. Use Micro Niche Finder AI to validate profitable markets in seconds. By analyzing search volume, competition, and buyer intent data, you can identify high-potential segments where your products or services will resonate—before you invest in building out campaigns or inventory. This accelerates the feedback loop and ensures your data collection efforts focus on markets that actually convert.

The companies winning in 2026 aren't just collecting data—they're using it to make smarter bets about where to compete. Start there.

Sources

• [1] https://videoweek.com/2026/01/23/week-in-review-tiktok-finalises-its-us-sale-pg-signals-a-media-shakeup-and-wpp-launches-a-unified-production-hub/
• [2] https://www.marketingdive.com/news/pg-prioritizes-data-ai-to-tackle-fragmented-new-media-reality/810330/
• [3] https://www.digitalcommerce360.com/2026/01/23/pg-ecommerce-sales-ai-q2-2026/
• [4] https://chiefaiofficer.com/blog/blog/how-pgs-ai-powered-ad-testing-cut-optimization-time-from-weeks-to-days-and-reduced-costs-90/
• [5] https://letsdatascience.com/news/procter-gamble-uses-ai-to-unlock-insights-18b79027
• [6] https://www.prii.ie/resource/how-procter-gamble-uses-ai-to-unlock-new-insights-from-data.html
• [7] https://simplywall.st/stocks/us/household/nyse-pg/procter-gamble/news/pg-pushes-into-digestive-health-and-ai-with-potential-upside
• [8] https://sloanreview.mit.edu/article/how-procter-gamble-uses-ai-to-unlock-new-insights-from-data/
• [9] https://us.pg.com/blogs/innovation-at-scale-transforming-business-through-technology/
• [10] https://mlq.ai/earnings/highlight/PG-12-18-months-for-pgs-transformation-to-ce0bc1/

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This article was assisted by Smart Hustler AI research technologies.