Summits Yellow

Unilever cuts ad spend to fend off potential buyers, WPP takes hit

Tyrone Stewart

UnileverAnglo-Dutch consumer goods company Unilever has made the decision to cut its ad spend by 30 per cent, while also reducing the number of the creative agencies it works with by 50 per cent, after turning down a $143bn takeover bid from Kraft Heinz in February.

The drive to cut costs will come as a major blow to WPP, the world’s largest advertising company which gets three per cent of its revenue from Unilever, according to Bloomberg.

The decision by the company, which boasts brands such Dove, Hellmann’s, Lynx, Magnum and Surf, follows a similar decision that was made Procter & Gamble – which has also halved the creative agencies it works with.

In addition to reducing ad spend, the conglomerate has made the decision to cut the cost of consultants by 40 per cent, reduce senior and middle management levels by 15 per cent, and it will also either sell or demerge its spreads business – after growing decline in sales.