Drop in demand, purchasing power drives food companies to spend more on marketing

The drop in consumer demand and purchasing power due to rising prices is causing food and beverage producers to increase spending on marketing and advertising in order to preserve their market shares, according to a report in Al Borsa. Overall demand for food and beverage is down 20-40% y-o-y in 1Q2017, sector analyst Omneya El Hamamy says. El Hamamy explains that the additional marketing costs have been a burden since most manufacturers sales and distribution costs have also risen as a result of the fuel price hikes.