Cost cutting was the mantra for almost 5 years among food makers. The thought was you could put the savings to the bottom line. Executives felt the consumer would just keep buying your products and profits would grow.
The reality was quite a different story. The consumer moved to other brands and the enthusiasm for Kraft Heinz, Hershey, Kellogg and Unilever to name a few companies waned to say the least. Sales declined as the consumer found other more enticing products that became top of mind as a result of marketing. It was even worse for Kraft Heinz as they had to write down the value of some of their brands by $17 billion! The stock price is down almost 66% since cost cutting began.
Yikes- quite an expensive lesson.
Now that reality has set in with these food businesses, they are going to try to recreate interest in their products/brands with marketing. At Super Bowl LIV these brands are beginning to heighten awareness and start reconnecting with the customer via advertising. Brands need to be treated with respect and not be ignored. Just like the loyal consumer, a brand needs to be nurtured with advertising and consumer marketing by raising awareness and making sure everyone has the brand in their head when they go to the store or shop online.
The best way to keep a brand relevant is by investment spending. The result will be sales growth and a renewed connection with existing customers and new people trying the products as well.
Lesson learned-You have to put your money where you mouth is.
