FMCG giant Nestlé’s full year results show that the company increased its marketing spend by 0.8% in 2023. Despite headline sales falling 1.5% to $105bn, the company still managed to achieve organic growth of 7.2%. Looking ahead to 2024, the Switzerland-based company is predicting organic sales growth around 4% and a moderate increase in its underlying trading operating profit margin.
Nestlé CEO, Mark Schneider, said the company had performed well in the face of the cost of living crisis: "Unprecedented inflation over the last two years has increased pressure on many consumers and impacted demand for food and beverage products. In this challenging context, we delivered strong organic growth and solid margin improvement with increased marketing and other growth investments.”
Going forward, Schneider said: “We are prioritising volume- and mix-led growth with increased brand support, as we enhance value for consumers through active innovation and renovation, premiumisation, affordability and more nutritious options. We will continue to focus capital allocation on our fast-growing billionaire brands, which enables us to deliver dependable growth while enhancing brand loyalty.”
Marketing and administration expenses as a percentage of sales were 18.9% in 2023. Within this, advertising and marketing expenses were 7.7% of sales (circa $8bn).