Nestlé increases marketing spend as sales fall 1.5%

Nestlé has increased its marketing spend by 0.8% year-on-year while its sales dropped 1.5% to $104.7 billion (£83 billion).

The global food and drink company, which owns brands including Aero, Cheerios, KitKat, Nescafé, Smarties and Quality Street, "significantly increased" its marketing and advertising expenses to 18.9% of its sale revenues. 

Nestlé has also continued to invest in brand marketing for the rollout of its Nespresso Vertuo system, which began in the UK in 2017.

Sales at Nestlé were affected by high inflation as the cost-of-living crisis continues to hit consumer demand, it reported.

Mark Schneider, chief executive of Nestlé, said: “Unprecedented inflation over the last two years has increased pressure on many people and impacted demand for food and beverage products.”

Schneider added the FMCG giant will continue its focus on its “fast-growing brands, which enables us to deliver dependable growth while enhancing brand loyalty”.

He said Nestlé “delivered strong organic growth and solid margin improvement with increased marketing and other growth investments despite a challenging context."

Nestlé picked WPP to handle its European media planning and buying account in September, while Cheerios brought in Havas to run its UK and Australian creative account in November.