Cannes 2010

Unilever to Double Digital Spending This Year

At Cannes, CMO Weed Says Increased Outlay Often Involves Production Costs More Than Media Buys

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CANNES, France ( -- Unilever will double spending on digital marketing this year, Chief Marketing Officer Keith Weed said in a seminar today at the International Advertising Festival, as the world's No. 2 advertiser looks to make its digital presence proportionate to the amount of time people spend with digital media.

Keith Weed
Keith Weed Credit: Francois Durand
"I think you need to fish where the fish are," Mr. Weed said during a question-and-answer session with WPP Chief Executive Martin Sorrell. "So I've made it fairly clear that I'm driving Unilever to be at the leading edge of digital marketing."

Unilever isn't blindly looking to put more money into digital, Mr. Weed said. "It would be incorrect to suddenly swing and have a huge amount of money in digital in a country where it isn't developed," he said. "Now, in the U.S., where people are spending 25% of their time in some sort of digital engagement, then you should be proportionate. ... You will find that we will be in the 20% areas in markets like the U.S. And you will find we'll be in the single [digits] in markets that are less developed."

Measured media spending has lagged Unilever's rhetorical embrace of digital over the years. The company spent only 4% of its $864 million in measured media last year on internet spending, according to Kantar Media, and even doubling wouldn't get it to 20% this year.

Doubles U.S. online advertising
But Unilever did double its measured U.S. internet advertising last year. And those figures miss large chunks of digital spending, including search, mobile, brand websites, most video ads and the cost of behavioral targeting or production for a large amount of digital media -- which most recently included talent fees for the likes of St. Louis Cardinals first baseman Albert Pujols and New York Yankees pitcher Andy Pettitte in a recently launched digital-only campaign.

"It also comes down to who you're targeting," Mr. Weed said. "You have to know when you're talking to housewives in Shanghai that they're spending an average of three hours a day online."

In an interview after his presentation, Mr. Weed said the ramp up in digital spending often has little to do with paid media and much more to do with production costs.

Among examples are a campaign for Axe in India that got young men to download a mobile-phone app that has a sexy woman's voice wake them up each morning -- and becoming friendlier over time as men use it.

Lipton also had a program in China that let people upload their photos and superimpose them on a group of people doing a music video -- a riff on Office Depot's "Elf Yourself" that reached 100 million people.

"Numbers like that," he said, "get people like me excited."

He acknowledged there's risk in leaving people behind when trying, as he's advocated, to "get ahead of consumers."

Digital tour
After leading nearly 30 Unilever executives on a trip to Silicon Valley in May, Mr. Weed also spent much of his time at Cannes this week focused on digital marketing. He had breakfast today with executives of Google and lunch with executives of Microsoft.

P&G, which also doubled its measured U.S. internet spending last year to $100 million and pegs its global digital outlay above 10% of its marketing budget, is also committed to becoming more digital in all areas of its operations -- including media -- Chairman-CEO Bob McDonald said in a separate Cannes seminar with Publicis Groupe Chairman-CEO Maurice Levy.

"The risk I've seen," Mr. McDonald said, "is still we're talking too often about media, or even parts of media, whether it be search or e-mail or whatever. And I think what we ought to be talking about is relationships and serving and allow the media to be used holistically to reach that consumer in the best way."

Part of aligning P&G with the new reality of digital is relaxing corporate policies to let employees use whatever equipment and applications they want, Mr. McDonald said.

"If you want to be the most technology-enabled company in the world," he said, "you have to fit your systems to what employees want to use."

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