CHICAGO: Mondelez, the snack foods giant, continues to shift its spending towards digital, which it now expects to account for 30% of total media spending by 2018 a leading executive has said.
Mark Clouse, chief growth officer, told a Barclays investor conference that digital media cost less than traditional media but delivered twice the return on investment. Consequently the proportion of spending directed there will double from 2014 to 2018, Advertising Age reported.
Overall, expenditure on advertising and consumer support is being steadily increased: from around 8% of revenue in 2014, it rose to more than 9% in the second quarter of this year and, said Clouse, will continue to grow, to over 10%.
Clouse also revealed that the company was eyeing significant growth in online sales. "We estimate that ecommerce could become one of the fastest-growing platforms within our company, increasing from less than $100m in revenue today to as much as $1bn by 2020," he said.
This will be achieved in part by making some products and promotions online exclusives. When Mondelez rolls out Stars Wars-themed Trident chewing gum later this year, for example, some versions will only be available online.
"Buy now" buttons in content placed on platforms such as Facebook, Twitter and YouTube redirect consumers to nearby retailer websites where they can complete a purchase.
The Financial Times reported that the company was already operating this model in 25 markets and had partnered with 130 online retailers.
In terms of product development, Mondelez plans to increase the "well-being" proportion of its portfolio from the current 33% to 50% by 2020, cutting the levels of saturated fats and salt in certain products and removing artificial colours and flavours while increasing the use of wholegrains.
"Consumers want ingredients that they recognise and if it's on our ingredient line, a consumer should be able to find it in their kitchen," explained Clouse.
Mark Clouse, chief growth officer, told a Barclays investor conference that digital media cost less than traditional media but delivered twice the return on investment. Consequently the proportion of spending directed there will double from 2014 to 2018, Advertising Age reported.
Overall, expenditure on advertising and consumer support is being steadily increased: from around 8% of revenue in 2014, it rose to more than 9% in the second quarter of this year and, said Clouse, will continue to grow, to over 10%.
Clouse also revealed that the company was eyeing significant growth in online sales. "We estimate that ecommerce could become one of the fastest-growing platforms within our company, increasing from less than $100m in revenue today to as much as $1bn by 2020," he said.
This will be achieved in part by making some products and promotions online exclusives. When Mondelez rolls out Stars Wars-themed Trident chewing gum later this year, for example, some versions will only be available online.
"Buy now" buttons in content placed on platforms such as Facebook, Twitter and YouTube redirect consumers to nearby retailer websites where they can complete a purchase.
The Financial Times reported that the company was already operating this model in 25 markets and had partnered with 130 online retailers.
In terms of product development, Mondelez plans to increase the "well-being" proportion of its portfolio from the current 33% to 50% by 2020, cutting the levels of saturated fats and salt in certain products and removing artificial colours and flavours while increasing the use of wholegrains.
"Consumers want ingredients that they recognise and if it's on our ingredient line, a consumer should be able to find it in their kitchen," explained Clouse.
Data sourced from Advertising Age, Financial Times; additional content by Warc stafF
