PepsiCo to cull 8,700 jobs and invest an extra $600m in advertising
PepsiCo is slashing 8,700 jobs, around 3% of its workforce, and is to mirror rival Coca-Cola by announcing a major investment in advertising and marketing.
PepsiCo brands: parent company to cut jobs and invest $600m in advertising
PepsiCo is to up investment in its core cola and crisps brands in North America, which some believe have been neglected as the company strives to promote and invest in healthier brands.
PepsiCo did not disclose whether its UK operation, which makes Walkers Crisps, would be impacted by the jobs cuts, which were announced as the company reported a 15% lift in sales in 2011 to $65.5bn (£41.2bn), with profits up 2% to $6.5bn (£4bn).
PepsiCo employs more than 5,000 people in the UK.
The global drinks and snacks brand announced an additional investment of between $500m (£315m) and $600m (£378m) in 2012 in advertising and marketing support.
It mirrors a similar announced by Coca-Cola, which recently announced it was to re-invest up to $400m (£252m) in brand-building initiatives. Premier Foods has also made a similar advertising strategy commitment.
PepsiCo's advertising uplift is primarily to focus on the US, where it has been losing market share to rival Coca-Cola.
The swingeing job cuts are part of PepsiCo's aim of saving $1.5bn (£944m) by 2014.
Other measures to help meet the target include further organisational changes, a closer working relationship between countries, a rationalisation of agencies and introducing new technologies.
Hugh Johnston, chief financial officer, said: "As we implement our strategic priorities in 2012, we've had to make tough decisions. As a result, 2012 will be a year of transition."
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This article was first published on marketingmagazine.co.uk
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