The news: Consumer goods giants Kraft Heinz and Unilever are moving to stimulate demand in a challenging sales climate by increasing marketing spending on their most popular products.

• Kraft plans to boost its North America media spending by 20% YoY in the second half, increasing marketing budgets across kids’ brands like Capri-Sun, Jell-O, Kraft Mac & Cheese, and Lunchables.
• Unilever, meanwhile, has lifted marketing spending to 15.5% of revenues as part of a turnaround strategy that includes leaning heavily into social media, scaling influencer partnerships, and using AI to speed up content production for its biggest brands.

Brand-building and restructuring: Both companies are leaning on brand-building efforts to fuel growth and fend off private-label competition, even as they mull portfolio changes in a bid to improve performance. Kraft Heinz is reportedly planning to break off most of its grocery business, while Unilever expects to spin off its ice cream business this year.

The ice cream business was a sweet spot for Unilever in the first half, with Morningstar analyst Diana Radu noting that total volume growth was 1.5% but dropped to 1% when excluding that division, which includes Ben & Jerry’s, Breyers, and Magnum. Unilever said overall sales, excluding currency fluctuations and one-offs, rose 3.8% in Q2 as it increased brand support.

Kraft Heinz sales eased 1.9% to $6.35 billion in Q2 despite higher prices on some goods, such as coffee. Unilever stood by a prior outlook calling for full-year underlying sales growth of 3% to 5%, while Kraft Heinz said it continues to expect a 1.5% to 3.5% drop in organic sales this year.

Our take: Despite different restructuring paths, both companies are betting on marketing to spur demand and improve brand equity in a slower-growth climate. But the question is whether stepped-up marketing will be enough to overcome rising consumer caution in a tariff-driven environment, particularly in categories like snacks and personal care where purchases are more discretionary. Increased investments in promotions could pressure margins in coming quarters.

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