Nestlé said it has picked WPP Openmind to be its sole media agency in Europe, as the world's biggest packaged food maker seeks to target consumers more efficiently amid a cost-of-living crisis that is changing shopping habits.
Scoring Nestlé's agency business is a major win for WPP Openmind at a time when global ad spending is falling. WPP, the world's top advertising group, in August downgraded its full-year growth forecast due to lower spending by technology companies.
"The result (of the contract) will be better decision-making and media planning to allow campaigns to build brands and win consumer attention at scale," a Nestlé spokesperson said in a statement.
WPP OpenMind will coordinate Nestle's marketing communications – including buying advertising space and planning campaigns – for its hundreds of brands in Europe including Kit Kat chocolate bars and Nescafe coffee.
The agency will not, however, be in charge of creative work such as animation, making jingles and other content generation.
Nestlé said this announcement was for Europe only, and had no bearing on other regions.
Like many of its rivals, Nestlé's spending on marketing was muted last year largely because of supply chain problems and uncertainty over consumer behaviour, but has returned this year.
Top brands are battling to hold onto customers as some cut spending or switch to cheaper alternatives amid rising prices.
CEO Mark Schneider said in July that Nestle's second-quarter marketing spend was "significantly above last year's level" and it would "continue to invest in a very robust manner in the second half of 2023".
In the first half of 2023, Nestle's advertising and marketing spend increased by 7.5% in constant currency versus the same period of the prior year.