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Mondelez vows discipline in marketing as it cuts down on promotional spend

Mondelez said it will now adopt a “more disciplined” approach in its marketing and branding strategy. According to its financial reports, the company said it has plans to move away from promotional spending and build its brand power.

When reach by Marketing on the effects on this approach on its APAC region, a spokesperson from the company said, “There is no change in our region. We continue to apply robust standards to all of our marketing spend.” Last year, Mondelez Malaysia also pumped in RM$21 million to extend the production of belVita Breakfast Biscuits (belVita) to its manufacturing facility in Tampoi, Johor Bahru.

A Mondelez’s spokesperson told A+M that the expansion is expected to fuel the supply of its belVita range across Malaysia and other Southeast Asia markets such as Indonesia, Singapore and Hong Kong.

Overall, Mondelez saw its net revenue plummet 8.1% to US $6.77 billion in the fourth quarter. The net revenue decreased by 12.5% for the whole year.

On an earnings call, Irene B Rosenfeld, chief executive of the company said that the promotional spending in the UK and US was “a little tougher than expected.” This led to increased pressure on the business’s margins, urging the company to adopt a more disciplined approach on strategising its marketing spend. She further added that with a more streamlined focus on innovation and brand marketing, the company hopes to correct its advertising spend which was essentially flat last year.

“We continue to make solid progress toward our near-term margin targets, while investing for long-term growth,” said Rosenfeld.

However, despite significant economic disruptions, political uncertainties and slower global category growth, the company remains confident in and committed about a balanced strategy for both top- and bottom-line growth.

“Throughout the year, we continued to sharpen the focus of our portfolio, increase power brand investments and modernise our supply chain. These actions, together with our cost discipline, position us well to deliver strong operating leverage that will drive sustainable value creation for our shareholders,” added Rosenfeld.

Late last year, the candy maker separated its media and e-commerce business shortly after the departure of Bonin Bough, chief media and e-commerce officer at Mondelez International.

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