Unilever claims it’s driving down agency and production costs

Global marketing giant Unilever, which is currently reviewing its $6bn global media roster, claims that it’s succeeding in its aim of driving down ‘non-productive’ ad agency and production costs.

It spent $8.2bn on marketing last year, a two per cent increase on the big hike seen a year before. But the company’s chief financial officer Jean-Marc Huet (pictured) said at a presentation this week: “We significantly reduced our non-productive spend during the year. As you know, that’s the money we spend on production costs and agency fees, money that’s not directly driving the exposure of our brands to the community and consumers.”

Huet also says the company is increasing its spend on digital, seen to be less expensive than traditional media, by 15 per cent a year

Last April Unilever CMO Keith Weed announced that the company was seeking to reduce the number of production companies it used to save costs. Huet didn’t specify the amount the company had saved, or the reduction in numbers, but it’s clear that Unilever, along with other consumer goods giants like Procter & Gamble and Reckitt Benckiser, is now squeezing its marketing suppliers as they all grapple with rising commodity prices and low growth in North America and Europe.

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About Stephen Foster

Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.

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