18 September 2000

Danone’s advertising expenditure grew at twice the rate of sales in the first half of 2000, according to the company’s financial results.

The French food giant spent $350 million on product and brand advertising, a rise of 18%. Sales were up only 8% to $6.2 billion.

President Franck Riboud blamed the climb in advertising expenditure on the consolidation of Danone’s product areas of biscuits, dairy products and mineral water.

Mr. Riboud expressed confidence in Danone’s ongoing US launch of their milk-based drink Actimel, marketed as an aid to digestion. It is expected to bring in $400 million next year.

The focus on the US market reflects Danone’s higher growth outside Europe. Sales in the EU rose only 5.7%, compared with 12% for the rest of the world.

News source: Advertising Age - International Daily