• Ad Age, Monday, February 25, 2008 11:15 AM

Kellogg Co. is boosting its marketing budget over the $1 billion mark, a move that CEO David Mackay is trying to defend to his company's investors and Wall Street in general. "We believe this really helps us as we look at a more volatile environment," he says. "We believe continued investment in our brands increases our dependability as a company."

Mackay notes that the company's ad spending has increased 30% in the last five years as part of a strategy to increase -- or merely hold -- market share as commodity costs bring price hikes on Kellogg brands and those of rivals including Kraft, General Mills and Sara Lee (all of which have also hiked marketing and advertising spending in the last year.) But since getting investors to OK higher ad investment is a tough sell, he tries to assure them that Kellogg watches the return on investment very closely.<

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