Unilever and P&G hold budgets steady
LONDON - Leaders of consumer goods giants Unilever and Procter & Gamble have indicated they will not be cutting the amount they spend on marketing despite the global downturn.
AG Lafley, the chairman and chief executive of Procter & Gamble, has been reported in the Financial Times as saying his company would keep budgets at the same level as last year.
"Right now the plans are to spend about the same percentage of sales [on advertising as last year]," he said.
His outlook was echoed by Simon Rothon, Unilever's senior vice-president of global marketing services, who told the FT: "Overall we are sustaining levels of total support.
"It's marketing wisdom that the advertisers that sustain advertising at the optimum level in a downturn are the ones who emerge with a much more sprightly step when they come out of a recession."
UK marketing services firms are awaiting the next issue of the quarterly Bellwether measure of the health of client budgets, which is due within weeks.
The last report showed that budgets had been revised down for the second successive quarter, though total expenditure was still set to grow year on year.
The report showed that budget reductions were concentrated in direct marketing and sales promotion, but digital remained in rude health.
However, Lafley said P&G would be increasing its activity in shops. "In a period of food price inflation, more of the shopping list is being decided in the store."
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