Amongst all the bad earnings reports and economic news that leaves us quaking is a truism that is being played out by General Mills: supporting strong brands pays off, even in weak econonomies. For the entire article click on http://adage.com/article?article_id=134670.
General Mills Thrives on Increased Marketing Spending
Boosting TV Ads Hiked Cereal Sales, But Digital ROI Even Higher
Published: February 17, 2009
BOCA RATON, Fla. (AdAge.com) — General Mills, one of the package-food industry’s top performers, laid out a number of recent marketing successes at the Consumer Analysts Group of New York conference this morning, and offered a preview of the rest of its fiscal year.
The company has staunchly supported consumer-marketing spending increases — 19% in the first half of fiscal 2009, which began in June — while competitors, including Kellogg and Kraft, have begun to scale back on the heady marketing outlays of 2008, instead preaching bundling and greater return on investment. General Mills estimates that its consumer-marketing spending will be up by “double digits” for the full fiscal year.
General Mills’ sales have responded well to increased marketing support as consumers are eating more at home. Sales grew 11% in the first half of fiscal 2009, to $7.5 billion. The company has raised guidance with each of the first two quarters. General Mills is doing so well that analysts had been expecting the company to raise its earnings guidance again this morning.