Unilever boosts digital spend

LONDON: Unilever, the FMCG giant, boosted its digital advertising expenditure by almost 40% last year, reflecting the company's growing emphasis on using online touchpoints to reach consumers.

"Digital spend increased by close to 40% in the year, as we continue to find new digital expressions for the brands that we have," Jean-Marc Huët, Unilever's chief financial officer, told analysts.

During 2012, the firm – which owns brands including Ben & Jerry's, Magnum and Hellmann's – raised its overall spend on advertising and promotion by €470m year on year at constant prices to €6.5bn.

"That also is a big increase over €1.5bn in the last four years, and close to two-thirds of that increase has been in the so-called 'good cholesterol' of advertising, not promotion," said Huët.

More specifically, the growth in expenditure in 2012 came "despite our continued progress in driving better efficiency in our spending", he added.

Among the areas where Unilever is adopting greater financial rigour is agency remuneration and other expenses beyond actually running ads.

Huët said: "Nonworking media – that's the part of the advertising spend which is used to make films, pay agencies and the like – continues to reduce, but we are still some way from benchmark levels and we aim to do better."

The cost efficiencies associated with new media has also aided this process. Huët cited Unilever's place in the "Digital A-List" produced by Advertising Age and recognising the pioneering firm's in this space, as an example of its broader progress.

He similarly pointed to the fact it has run an initiative putting 2,000 members of its marketing staff through a "digital training academy" to develop their skills related to this increasingly-important medium.

Unilever has also opened MediaLabs to explore this channel in all of its eight geographic clusters, from Europe and North Asia to Africa and Latin America, and operating in countries like Singapore and Brazil.

Huët also referenced "the extent of our global partnerships" in the digital arena, as Unilever has formed partnerships with companies from News Corp and Viacom to Facebook, Twitter and Google.

In further demonstration of its focus on this field, Huët was one of several leading Unilever executives attending the annual Consumer Electronics Show in Las Vegas, which was held in early January.

Data sourced from Seeking Alpha; additional content by Warc staff, 25 January 2013

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