FMCG Majors Report Mixed Advertising Spends in September Quarter Amid Shifting Market Pressures

Major fast-moving consumer goods (FMCG) brands adjusted their advertising expenditures during the September-ending quarter, with analysts anticipating potential investment growth as macroeconomic pressures ease and festive buying picks up.

Companies reported divergent strategies regarding their marketing budgets. Marico and Colgate-Palmolive registered notable year-on-year increases in ad spends of 44 per cent and 40 per cent respectively. Meanwhile, Godrej Consumer Products Limited (GCPL) raised its spending marginally by 2.1 per cent.

Commenting on the strategy, Noel Wallace, Chairman, President, and CEO of Colgate-Palmolive, stated that the focus moving forward is to continue accelerating advertising while using available tools to optimise spending efficiently.

GCPL also highlighted its approach of balancing investments amid inflation. Aasif Malbari, Managing Director and CEO of GCPL, noted that the company is working closely with agencies to deliver better reach at a lower cost while keeping its share of voice at target levels.

In contrast, other market participants adopted a more cautious stance. Hindustan Unilever (HUL) reduced its advertising spend by 9 per cent year-on-year, while Dabur India increased its spending by 2 per cent.

Addressing queries regarding the lower ad spend-to-sales ratio, Priya Nair, CEO and Managing Director of HUL, explained that the company calibrated its spending amid rising input costs and directed resources to categories where pricing was not passed on directly to consumers.

Independent brand strategist and angel investor Lloyd Mathias attributed the cautious behavior among some firms to below-par monsoons and global developments. However, he anticipates that ad spends will pick up going forward, supported by stable oil prices, political developments in the US, and increased investments by top-tier brands.

Ajimon Francis, Managing Director at Brand Finance India, noted that advertising investments from a headquarters perspective have remained steady, while local performance improved due to foreign exchange rates. He added that the sector benefits from seasonal factors such as back-to-school purchases and the Indian festive season, which typically brings a flurry of promotional campaigns and retail schemes, making it the heaviest spending quarter for companies.

"The recent divergence in FMCG advertising spends highlights how different companies are balancing margin protection with market reach amidst shifting macroeconomic conditions. While some brands are aggressively increasing investments to capture festive demand, others are strategically calibrating costs to manage rising input pressures. For businesses and emerging brands, this underscores the importance of operational efficiency, targeted reach, and disciplined capital allocation during periods of fluctuating consumer demand." — Dr. Shishir Gupta, Founder & CEO, StartupLanes