Unilever’s performance rebounds as ad spend increases
Unilever says increased spending on marketing brands such as Dove, Lynx and Lipton helped it post an improved performance for its latest quarter and full financial year.
The company says sales for the 12 months to 31 December grew 4.3 per cent. Sales for the three months to 31 December grew 4.1 per cent, an improvement on the 3.2 per cent registered in the previous quarter.
Sales income from emerging markets, where the company generates more than half of sales from, grew 8.7 per cent for the full-year and 8.1 per cent for the quarter. Sales from emerging marketers had grown 5.9 per cent in the previous quarter.
By contrast, the company says from developed markets remained “weak” with the exception of the UK, which the company says posted its twenty-fifth consecutive quarter of growth.
The company says spending on advertising and promotions grew 50 base percentage points to €460 million, an investment to “build brands for the long term”, it adds.
In a presentation delivered this morning (21 January) to detail progress, the company says it will invest in marketing-led growth opportunities such as white space expansion as well as driving premiumisation by pushing products such as IOMA, which it runs in partnership with the skincare brand’s eponymous parent company.
Despite the commitment to investment in advertising and promoting its products and in product innovation, Unilever repeated intentions to cut €500m costs from its marketing operation. The company said in December it planned to cut the number of marketers it employs by 12 per cent globally.
There was an also emphasis on reducing “non-working” media such as the fees paid to agencies as well as the cost of producing advertising.
