Colgate- Palmolive cuts ad spend in Q3

MUMBAI: For television broadcasters hit by a slowdown, this is a piece of bad news. FMCG major Colgate-Palmolive India has reduced its ad spend by 10.86 per cent for the three-month period ended December, taking a reversal from their earlier two quarters in which promotional budgets had gone up compared to the year-ago period.

The company spent Rs 1.07 billion on advertising and sales promotion in the quarter under review, compared with Rs 1.2 billion a year ago.

Colgate Palmolive launched products like Colgate 360° Sonic Power (a battery operated toothbrush), Colgate ZigZag anti-Germ, Colgate Barbie and Colgate Spiderman in the toothbrush category.

In the tooth paste category, the company launched Colgate Barbie and Colgate Spiderman in the kids range. The company also rolled out the annual Oral Health Month during the end of the third quarter.

Meanwhile, the cut in ad spend coupled with a price increase, has positively impacted the bottom line, as the company posted a 74 per cent jump in the net profit.

Colgate-Palmolive net profit stood at Rs 1.16 billion, from Rs 662.4 million in the earlier year.

Sales during the quarter rose 20 per cent to Rs 6.7 billion, up from Rs 5.58 billion a year ago.

Analysts say the company will have to increase its ad spends soon, as Procter & Gamble (P&G) prepares to foray into the branded oral care sector in India, which is pegged at around Rs 45 billion.

Recently, Colgate roped in tennis player Mahesh Bhupathi and film star Rahul Bose as brand ambassadors for Colgate Total.

For the nine months ending 31 December, the company has spent Rs 3.21 billion over marketing and promotions compared to Rs 2.61 billion a year ago. Net sales stood at Rs 19.38 billion, up from Rs 16.39 billion.

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