NEW YORK: Procter & Gamble, Kimberly-Clark and several other major advertisers in the packaged goods and beauty sectors cut their US adspend in the final quarter of last year, when category outlay fell by 14% on an annual basis, reports Goldman Sachs.
While many marketers cut their adspend in a recession in an effort to cut costs, it has been argued the strategy of "going dark" can undermine marketers' positions both during the downturn and after it has finished.
According to Goldman's analysis, P&G reduced its media outlay by 11% in the US in the last three months of 2008, and by 8% for the year as a whole.
The company did, however, increase its investment in areas such as haircare and diapers in Q4 last year, with the latter of these two product sectors enjoying a 27% uplift in growth overall during this period.
Similarly, P&G was able to boost its share of voice in the hair care market by ten points to 52% on an annual basis in the fourth quarter, largely because Unilever cut back on communications almost entirely.
Kimberly-Clark also reduced its Amercian media outlay by 44% in the last three months of 2008, and by 15% for the year as a whole, compared with an annual spending increase of over 9% worldwide.
Among the other major brands assessed by Goldman Sachs using data from sources including TNS, Nielsen and IRI, Alberto Culver reduced its budget by 18% last year, with Estée Lauder down 20% and Avon by 24%.
Colgate was one of the few brands to increase its overall marketing expenditure in 2008, up 19% in Q4 and by 6% for the year as a whole.
Some product categories were also reported as enjoying an upturn in adspend in an attempt to fight off competition from own-label products, with one example, toilet paper, up 24% on an annual basis.
Overall, the money spent by the companies assessed by Goldman on trade promotion was flat, with P&G increasing its outlay by 1%, while Kimberly-Clark cut back by 3%.
Data sourced from AdAge; additional content by WARC staff