Unilever signs $460 million TV advertising deal

In what it calls the biggest advertising tie-up of its kind in the UK, Unilever has signed a ?320 million ($460 million) deal with UK broadcasters Carlton Communications and Granada to promote its brands.

The company has committed to paying ?320 million over four years to promote its household brands, including Birds Eye and Persil, on ITV1. The four-year deal forms part of the Anglo-Dutch FMCG behemoth's Path to Grow strategy aimed at concentrating its resources behind its focused portfolio of leading brands that range from Persil, Dove, Lynx and Sure to Flora, Hellmann's, Knorr, PG Tips, Birds Eye Frozen Foods and Walls Ice Cream to Calvin Klein Cosmetics.

Unilever's Indian arm Hindustan Lever appears to have modelled its own "power brands" strategy where 90 per cent of the company's ad spend is directed towards 30 "power brands" on the Unilever model. Launched in 1999, a leading objective of Unilever's Path to Growth is to whittle its brands to 400 from 1600 by 2004.

Unilever is the UK's largest advertiser (as is Hindustan Lever in India) and Carlton and Granada run the UK's biggest commercial TV network ITV which has been hit by the current TV advertising slump and the failure of its pay-TV venture ITV Digital. Advertising on ITV is up on an annual basis for the first time this month and should show year-on-year growth of around 6 per cent in June.

The deal will reportedly buy Unilever a huge slab of airtime to promote its top brands like Persil, Lynx deodorant and Magnum ice-cream on prime-time television. The three parties have been reportedly in talks since the start of the year and the deal has been backdated to 1 January. It will run until the end of 2005.

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