Originally Posted by
Left field
Baby Tiger over in HC commented as follows....
"Nestle spent between 20-25% of their revenue on Marketing and admin expenses (source, Nestle's half yearly report: 10bn marketing over 45bn revenue), only to earn net profit of 10% of revenue (5bn over 45bn). On top of that, Nestle's net profit is declining, along with their market share.
Where as A2M, only spent 10% of revenue, to earn net profit at 21%"
In my experience with companies such as Unilever, the marketing spend of 10% of revenue is about right. Sometimes it goes as high as 20% to (say) launch a new product/range and sometimes much lower (under 5%) for an established or 'mature' product/range.