Mondelez has operated as an independent organization since its split from the former Kraft Foods North American grocery business in October 2012. The firm is a leading player in the global snack arena with a presence in the biscuit (47% of sales), chocolate (32%), gum/candy (10%), beverage (4%), and cheese and grocery (7%) aisles. Mondelez's portfolio includes well-known brands like Oreo, Chips Ahoy, Halls, Trident, and Cadbury, among others. The firm derives around one third of revenue from developing markets, nearly 40% from Europe, and the remainder from North America.
The parent company of Oreo, Mondelēz International, is significantly reducing marketing costs through investment in artificial intelligence, marking a shift in the consumer goods sector as it embraces new technologies to reshape advertising production amidst profit pressures.
According to reports on the 25th, the snack giant is utilizing a new generative AI tool that is expected to cut marketing content creation costs by 30% to 50%. The company has invested over $40 million in this technology, developed in collaboration with advertising firm Publicis Groupe and IT consulting company Accenture.
The application of this AI tool is already underway, currently being used to create social media content for their "Tuc" biscuits in the U.S. market and "Mikado" chocolates in Germany. Plans are in place to deploy the tool for Oreo's product pages on Amazon and Walmart in the U.S. this November, with expansions planned for Brazil and the U.K. in the coming months.
Mondelēz’s ambitions extend beyond initial applications. Jon Halvorson, the company's Senior Vice President of Global Consumer Experience, stated that they expect the tool to produce broadcast-ready TV spots as early as next holiday season and potentially be utilized for advertisements during the 2027 Super Bowl.
AI Applications Yield Significant Cost Benefits Mondelēz International's AI tool has already demonstrated cost-effectiveness in actual business operations. For example, the tool generated an eight-second video for "Mikado" chocolates, showcasing chocolate cascading over wafers while tailoring backgrounds for different target consumer segments. Jon Halvorson noted that traditional animation production costs can reach hundreds of thousands of dollars, whereas using this AI tool reduces costs by several orders of magnitude.
In addition to current social media content, Mondelēz’s promotional plans are quickly expanding. The tool is set to enhance Oreo's product displays on major U.S. e-commerce platforms and soon support marketing for "Lacta" chocolates and Oreos in Brazil, as well as Cadbury promotions in the U.K. Halvorson added that if the tool evolves to create more complex videos in the future, the cost savings could increase further.
Intensifying Competition Spurs Industry Adoption of AI In reshaping marketing through AI, Mondelēz is not alone. Competitors have begun exploring AI for advertising production as well.
Pasta and cheese manufacturer Kraft Heinz and beverage giant Coca-Cola have also tested AI technologies in their advertising efforts. For instance, Coca-Cola aired a holiday advertisement created by AI in 2024, which sparked discussions when the computer-generated characters were perceived by some consumers as lacking emotional authenticity.
Recognizing potential risks associated with AI technology, Mondelēz International is adopting a cautious strategy. The company currently avoids using hyper-realistic human likenesses in AI-generated content. Tina Vaswani, Vice President of Digital and Data, emphasized that all AI-produced content will undergo human review to prevent any mishaps.
To ensure brand safety, the Chicago-based company has established clear guidelines. According to a document shared by Mondelēz, the company prohibits AI content from highlighting unhealthy eating habits, glamorizing excessive consumption, using e-cigarettes, employing emotionally manipulative language, and adopting offensive stereotypes.
Comments