Unilever’s Improved Results Due to Adspend Savings

29 April 2002

The thirty-three per cent rise in profits reported two months ago by household products giant Unilever [WAMN: 15-Feb-02] was achieved largely due to the worldwide decline in ad rates and hardnosed media buying.

Despite a fall in overall product sales, savings in the Anglo Dutch giant’s marketing budget lifted net profit by 35% to £576 million ($839.52m; €931.45m).

Said a spokesperson: “We are benefiting from lower media rates worldwide. The cost of advertising is going down and we are getting more for our money – and we are using different types of advertising” [the increased use of direct marketing and sales promotion techniques].

The group continues to pursue its strategy of nurturing its four hundred core brands, hiking marketing investment in these from 13% to 15% of sales. The axing of weaker brands and the arrival in the Unilever stable of Bestfoods’ big hitters – Hellmann’s and Knorr – has pumped-up the group’s media buying pectorals.

Commented the inevitable analyst, David Lang of Investec: “[Unilever] is buying space more efficiently. They are harnessing the power of their portfolio.”

Data sourced from: The Times (London); additional content by WARC staff