Ailing Unilever pledges boost to adspend

Unilever is expected to announce a marked increase in its marketing spend after unveiling a poor set of financial results this week.

The consumer goods giant, already the biggest advertiser in the UK, has announced a 3 per cent fall in turnover and a 2 per cent slump in pre-tax profits for the third quarter of the year to EUR1.32 billion. Underlying sales slipped 1.3 per cent, with a particularly poor result in Western Europe.

Significant declines were recorded in the ice-cream and ready-to-drink tea categories, and sales slumped in the Home and Personal Care sector in weaker markets.

Patrick Cescau and Antony Burgmans, the chairmen of Unilever, admitted that they were disappointed with the results: "We are dissatisfied with our performance and actions are being taken to improve the market competitiveness of our products. We are making adjustments to price points where necessary, stepping up support behind key innovations and increasing media spend for a number of our leading brands."

Unilever has suffered a loss of market share across brands including its Slim Fast weight-loss products and the Birds Eye frozen foods range.

Last month, Unilever's profit warning sent its shares to their lowest level in four years.

Analysts attribute the decline to a lack of marketing investment in key brands, enabling competitors such as Procter & Gamble, Nestle and Kraft to make inroads into Unilever's market share.

Unilever's global roster includes Lowe & Partners, McCann Erickson, Ogilvy & Mather, J. Walter Thompson and Bartle Bogle Hegarty.

- Comment, p52.

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