Mad Money

As P&G cuts marketing budget, Clorox CEO explains the values of digital marketing strategy

Key Points
      • "Mad Money" host Jim Cramer and Clorox chief Benno Dorer discuss the value of digital marketing.
      • Dorer also explains Clorox's overall strategy, which has served his consumer product company well in the last fiscal year.
Clorox CEO explains company's digital marketing strategy

As consumer goods giant Procter & Gamble slashes its marketing budget, rival Clorox is leaning into — and benefiting from — its digital advertising strategy, CEO Benno Dorer said.

"We follow the money. The money for us, the returns, are online, and we feel really good about where we are with our investments in marketing on digital and social," the Clorox chief told "Mad Money" host Jim Cramer on Thursday.

Dorer said that over 45 percent of Clorox's marketing spend is for online ads, and while the company's online sales are still a mere 4 percent of the business, they are growing rapidly.

Facebook, which allows companies and brands to promote themselves on its platform, is particularly useful for Clorox as a strategic partner, Dorer added.

The CEO said that he and other California executives have even talked about using their digital ad presence to an even greater advantage.

"We have declared that we'd like to build a network of strong companies in the online space, many of them residing here in the Bay Area, and leverage that as a competitive advantage," he said. "We are relevant online and we're investing behind that tailwind."

As other consumer goods names struggle in a technology-enamored stock market, shares of Clorox have been running healthily, up over 2 percent at Thursday's close.

The parent of Glad trash bags and Hidden Valley dressing posted a fourth-quarter earnings beat as it focused on drawing the consumer in several key ways.

"We keep our value sharp," Dorer told Cramer. "And consumer value for us is offering differentiated products and brands at sharp price differences versus our competitors, and then invest[ing] in our brands. And we're doing all of that well, which is why the majority of our brands [are] perceived to be superior by the consumer in value, and which is why we're gaining access to new households."

Dorer said that the Clorox brand, the company's namesake and biggest seller, was used in 2 million new households in the last fiscal year.

"We're winning with consumers, and our growth with customers also is very broad-based," the CEO said. "So that's been the hallmark and that's why we're doing well in this undoubtedly challenging environment."

Watch Benno Dorer's full interview:

As P&G cuts marketing budget, Clorox CEO explains the values of digital marketing strategy

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