Consumer Goods Manufacturers Are Ramping Up Advertising

Consumer giants are increasing their advertising intensity at a time when other major advertisers are pulling back, according to a new report from WARC (an international research organization in marketing and media).

The study's authors describe the current picture as a 'two-speed marketplace': major categories are spending on advertising along opposite trajectories, and the divergence between them is becoming a structural feature of the market rather than a temporary fluctuation.

Who Is Ramping Up and Who Is Cutting Back

According to WARC, advertisers' paths have diverged by sector:

• Manufacturers of consumer packaged goods (CPG) are increasing their advertising activity;
• The beauty segment and cosmetics brands are also showing growth in advertising intensity;
• Technology companies and a number of other major advertisers, by contrast, are reducing their advertising investments.

WARC uses the term 'two-speed marketplace' to describe a situation where some categories continue to invest in promotion while others — the same technology firms — cut their budgets. The divergence of trajectories, as the report's authors note, is what creates this two-speed dynamic.