• by Les Luchter , December 6, 2024

Kenvue, the world’s largest pureplay consumer health company, is concluding its first full year of splitting from Johnson & Johnson by continuing to increase ad spending.

Kenvue’s advertising-to-revenue ratio was at 8.7% in 2023, “well below competitive norms,” and will end 2024 in the 10%-11% range, “a significant improvement, but still below where our competitors are,” CEO Thibaut Mongon said at the Morgan Stanley Global Consumer and Retail Conference on Wednesday.

So, in 2025, Mongon said, Kenvue “will continue to up our investment level.”

In 2023, per earnings reports, Kenvue spent $1.35 billion on advertising, a 0.5% decrease year-over-year. Mongon said the budget has increased 20% this year, which would bring Kenvue’s ad spending to some $1.62 billion.

The increase is part of a change in growth strategy, which under J&J “focused on cash generation,” but is now focused on what Mongon calls the “Kenvue Playbook,” which includes “reaching more consumers” not only through advertising to consumers and healthcare professionals, but also “more distribution, more prominence in-store.”

“We have significantly changed the marketing playbook,” he said, “with our brands much more visible.”

Not only is Kenvue spending more on advertising, but it’s changed its media mix, with Mongon noting “a strong pivot to social media, to influencers.”

He bragged about a new partnership between Neutrogena and “two mega dermfluencers” -- Dr. Dhaval Bhanusali, and Dr. Muneeb Shah -- both of whom he said have “very, very strong followship” and will work with Neutrogena on product innovation as well as communications.

The “Kenvue Playbook,” meanwhile, is already paying off for Neutrogena, as Mongon said that a concentration on facecare brought the brand back into its top position in U.S. brick-and-mortar retailers during the third quarter, a position it’s now retained for 12 weeks running.

Kenvue has also increased its concentration on Neutrogena’s suncare products, one of the many Kenvue product categories that Mongon said are “under-diagnosed, under-treated, under-penetrated,” leading to “opportunities for household penetration.”

“Only half of Americans use sunscreen on a regular basis, when we know that’s it’s a major source of melanoma,” he explained

Even with Tylenol, “a well-penetrated brand in the U.S.” Mongon explained, you still have tens of millions of Americans who don't know that they have an underlying condition that should prevent them from using any other analgeisc than acetaminohen or Tylenol.”

“That's a work of education,” he related, “not an easy one, but a penetration opportunity we are going after in partnership with healthcare professionals and some retailers.”

Mongon praised Kenvue’s tracking capabilities as helping to steer the company to strong return-on-investment.

In media planning, for example, “we have an agency system, technology, and talent and capabilities that allow us to get industry-leading ROIs on our media investments.”

“We do the same with promo efficiency or return on our healthcare professional investments,” he added. “We track every week the average recommendation for brands from dentists, dermatologists, you name it.”

“We are we are very disciplined in making sure that we get returns on every dollar we invest behind our brands, whether it's media, promotions, or investments in healthcare professional reach.”