FMCG Players, Automakers Increase Ad Spending In Q2 To Boost Demand

In the July-September quarter, Colgate-Palmolive enhanced its marketing budget by 17.8 per cent to hit Rs 242 crore, stating this jump in spending aligned with the firm’s new product innovations

Multiple major consumer and automobile companies such as Nestle, Godrej Consumer Products, Maruti Suzuki, Skoda, Colgate-Palmolive, and Tata Motors hiked their advertising and marketing budgets during the second quarter of the current fiscal year (2024-25), media reports said.

Many companies have said that they plan to continue increased spending in the third quarter of the year to boost demand, reported The Economic Times. In the July-September quarter, Colgate-Palmolive enhanced its marketing budget by 17.8 per cent to hit Rs 242 crore, stating this jump in spending aligned with the firm’s new product innovations.

Meanwhile, Godrej also expressed its intention to slowly increase advertising expenditures, and Nestle India said it augmented its focus on advertising and marketing in the September quarter. Suresh Narayanan, chairman, Nestle India, noted, “We kept a relentless focus on investing behind our core brands, with advertising and marketing investments increasing this quarter.”

Larger players in the industry such as Hindustan Unilever, Dabur, Godrej, and Tata Consumer pointed out that urban demand has been under pressure due to rising food and fuel prices, however, rural demand has been improving gradually.

 

Typically, consumer goods firms contribute 6-12 per cent of their revenue to advertising and promotions. Automakers have also escalated their ‘tactical’ ad campaigns in order to clear up the excess inventory. These firms, including Tata Motors, Skoda, Volkswagen, and Maruti Suzuki, are undertaking efforts such as national and regional promotions to lure in customers to their showrooms.

The report cited industry sources and said that overall marketing expenses increased during the period as spending patterns shifted from brand awareness campaigns to direct marketing efforts. These also include print and radio ads, as ad spending in TV has decreased.