Migros will increasingly rely on online advertising
Starting next year, Migros will spend about 50 million francs less on advertising, promote only a few dozen of its own brands, and focus more on online advertising. This is according to an interview in the French-language newspaper L'Illustré with Claude Hauser, Chairman of the Board of Directors of the Federation of Migros Cooperatives.
In an interview with the French-language newspaper L'Illustré, Claude Hauser, Chairman of the Board of Directors of the Federation of Migros Cooperatives, reveals a few things about the orange giant's future advertising strategy. With regard to the advertising budget of around 350 million francs, Hauser speaks of savings of around 50 million francs (une cinquantaine de millions). This is significantly less than the figure of 70 million francs that was still being bandied about in September.
In addition, Migros will only actively advertise around a few dozen (quelques dizaines) of its total range of around 250 own brands. Hauser made a surprising statement about the use of advertising media: a large proportion of advertising expenditure would be made on the Internet in future. Hauser also said that there were no plans at all to do away with advertisements in daily newspapers and magazines, as had been suggested on several occasions. However, print advertising would be measured more by its effectiveness.
Savings as a natural process
Claude Hauser put the announced savings in a broader context. Migros has one of the highest advertising budgets of any retailer in Europe in terms of turnover. With sales of around CHF 15 billion and an advertising budget of CHF 350 million, around 2.3 percent of sales are spent on advertising. This is due to the high proportion of Migros' own brands, which make up around 90 percent of the product range. For this reason, Migros wants to focus its advertising on just a few products.
Hauser considers the savings to be a natural process due to developments within Migros. Due to the sharp increase in the number of own brands, advertising expenditure has also risen sharply over the years. The company had become bogged down and now the time had come to re-center itself. As a result, cooperation with many different agencies and thus control and overall coordination had become increasingly difficult. This inevitably led to waste. This is also the reason for the termination of all existing contracts and the current tendering process.
Shifting advertising to the Internet
With regard to the future advertising strategy, Claude Hauser said that it was obvious that more and more consumers were gathering information on the Internet, comparing prices and making their purchases there. Migros has responded to this consumer behavior by setting up the LeShop home delivery portal, which has been a great success. It is essential to have a strong advertising presence on the Internet. That is why, according to Hauser, "a large part of our publicity expenditure is spent on the Internet".
In addition, Migros will only actively advertise around a few dozen (quelques dizaines) of its total range of around 250 own brands. Hauser made a surprising statement about the use of advertising media: a large proportion of advertising expenditure would be made on the Internet in future. Hauser also said that there were no plans at all to do away with advertisements in daily newspapers and magazines, as had been suggested on several occasions. However, print advertising would be measured more by its effectiveness.
Savings as a natural process
Claude Hauser put the announced savings in a broader context. Migros has one of the highest advertising budgets of any retailer in Europe in terms of turnover. With sales of around CHF 15 billion and an advertising budget of CHF 350 million, around 2.3 percent of sales are spent on advertising. This is due to the high proportion of Migros' own brands, which make up around 90 percent of the product range. For this reason, Migros wants to focus its advertising on just a few products.
Hauser considers the savings to be a natural process due to developments within Migros. Due to the sharp increase in the number of own brands, advertising expenditure has also risen sharply over the years. The company had become bogged down and now the time had come to re-center itself. As a result, cooperation with many different agencies and thus control and overall coordination had become increasingly difficult. This inevitably led to waste. This is also the reason for the termination of all existing contracts and the current tendering process.
Shifting advertising to the Internet
With regard to the future advertising strategy, Claude Hauser said that it was obvious that more and more consumers were gathering information on the Internet, comparing prices and making their purchases there. Migros has responded to this consumer behavior by setting up the LeShop home delivery portal, which has been a great success. It is essential to have a strong advertising presence on the Internet. That is why, according to Hauser, "a large part of our publicity expenditure is spent on the Internet".



