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Nestl\u00e9, the multinational food and beverage conglomerate, has made a strategic decision to increase its marketing and advertising spend by 0.8% across 2023. This move comes despite a 1.5% drop in year-on-year sales to 83 billion and a 0.3% fall in real internal growth.<\/p>\n
The owner of popular brands such as Nescaf\u00e9, KitKat, and Nespresso, Nestl\u00e9 allocated a significant 7.7% of its total sales revenue to marketing and advertising expenses throughout the financial year. This decision was made even though global grocery inflation significantly undercut the firm\u2019s ability to price competitively in 2023.<\/p>\n
However, Nestl\u00e9\u2019s strategic investment in marketing appears to have paid off, as the company still registered 7.2% global organic growth, with this figure rising to 8.2% for its home European market.<\/p>\n
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\u201cIn this challenging context, we delivered strong organic growth and solid margin improvement with increased marketing and other growth investments,\u201d said Nestl\u00e9 CEO, Mark Schneider.<\/p>\n
As Nestl\u00e9 looks to the future, the company is prioritizing volume- and mix-led growth with increased brand support. Schneider outlined the company\u2019s strategy, stating, \u201cWe are enhancing value for consumers through active innovation and renovation, premiumization, affordability, and more nutritious options.\u201d<\/p>\n
To drive market share gains, Nestl\u00e9 is focusing on delighting consumers through differentiated offerings and superior execution. The company is confident in its strategy, portfolio, and capabilities to deliver on its 2025 targets.<\/p>\n
In 2024, Nestl\u00e9 expects to see solid organic sales growth of around 4%, alongside a moderate increase in its underlying trading operating profit margin. This forecast is based on the company\u2019s strategic investments in marketing and its commitment to innovation and product differentiation.<\/p>\n
With budgets tightening amidst economic uncertainty, it is more important than ever for B2B companies to ensure their marketing spend is allocated effectively. Below are some key considerations when looking to optimize return on marketing investment:<\/p>\n
Firstly, take a data-driven approach and closely analyze where marketing dollars are currently going and the tangible impact this is having on metrics like lead generation, opportunities created, and revenue growth. Identify the highest performing channels and campaigns to double down on.<\/p>\n
Additionally, align marketing goals and spending to wider commercial objectives around entering new markets, launching new products\/services, or driving penetration with existing customers. This strategic alignment ensures relevance and impact.<\/p>\n
Looking ahead, consider increased investment in owned channels like content, SEO, and events where engagement can be cost-effectively driven over a sustained period. Equally, look to rationalize expenditure on paid media and advertising if efficiencies can be found.<\/p>\n
Finally, focusing on sales and marketing alignment and closed-loop reporting provides clarity on marketing\u2019s contribution to pipeline and revenue. This quantifiable evidence helps build the case for sustained or increased budget.<\/p>\n
Taking this targeted, data-led approach will help B2B marketers optimize their budgets to drive commercial performance, even in challenging economic times.<\/p>\n
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