Friday, January 30, 2009

Sweet: Hershey to Boost Ad Spend 25%

Decline in kisses is not okay

The current decline in the flagging Hershey Kisses brand is “not acceptable,” says Hershey CEO David West. To shore up the brand, as well as others in the Hershey stable, the company plans to boost ad spending by as much as 25% this year.

That means Hershey could be looking at $200 million in ad spend, up from $161 million spent on advertising in 2008, writes MediaPost. The boost is due to the fact that the company became more efficient in its media buys in the latter part of 2008. West said that the GRP increase is “much, much higher than the actual increase in the rate of advertising.”

Hershey spent 23% more in the fourth quarter of 2008, for a net sales jump of 2.6%, to $1.4 billion. It is expecting a 2% to 3% bump in sales this year.

Hershey said it will continue to avoid advertising in shows or publications that showcase violence or sensationalism involving “delicate” social subjects.

Like Hershey, Procter & Gamble said last month that it plans to increase spending. P&G CEO A.G. Lafley said that it is currently possible to buy more media at a lower cost and to increase share of voice for its brands, compared to competitors.

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