Mondelez Embraces AI: Revolutionizing Snack Marketing with $40 Million Investment

Oreo-maker Mondelez will use AI for TV ads next year

Snacking giant Mondelez is using generative AI to slash marketing costs and is preparing to release AI-generated TV ads next year, a senior executive told Reuters. Jon Halvorson, Mondelez's global senior vice president of consumer experience, said the company has spent more than $40 million on an AI video tool that can halve production costs. TV ads made using the tool should be ready to air in time for the 2026 holiday season, he said, and potentially the 2027 Super Bowl. Mondelez is already using the tool to make social content for Chips Ahoy cookies and Milka chocolate, and will use it to design online product pages for Oreo cookies in November. Companies are increasingly turning to AI to cut ad spending, though results are mixed. Last year, Coca-Cola's AI-generated Christmas ads were savaged online as "soulless" and creepy.

Oreo-maker Mondelez to use new generative AI tool to slash marketing costs

NEW YORK, Oct 24 (Reuters) - Snack maker Mondelez (MDLZ.O), opens new tab is using a new generative AI tool to cut costs for the production of marketing content by 30% to 50%, a senior executive told Reuters. The packaged food manufacturer began developing the tool last year with IT firm Accenture (ACN.N), opens new tab and expects that it will be capable of making short TV ads that would be ready to air as soon as next year's holiday season, and potentially for the 2027 Super Bowl, said Jon Halvorson, Mondelez's global senior vice president of consumer experience. The Cadbury chocolate producer has invested more than $40 million in the tool, Halvorson said, adding that savings would grow if the tool is able to make more elaborate videos. Faced with tariffs and shrinking shopper budgets, Mondelez, like other consumer goods companies, is looking to adopt AI to slash fees paid to advertising agencies, and speed up how long it takes to develop and sell new products. Rivals such as macaroni-and-cheese maker Kraft Heinz (KHC.O), opens new tab and Coca-Cola (KO.N), opens new tab have also been trying out AI for ads. Coke in 2024 ran AI-created holiday ads, though the computer-created people in them were ridiculed by some consumers for lacking real emotion. Mondelez is not yet putting human likenesses in its AI-created content. It is using content generated by the new tool on social media for its Chips Ahoy cookies in the U.S. and Milka chocolate in Germany. An eight-second Milka video shows waves of chocolate rippling over a wafer, along with different backgrounds depending on which consumer Mondelez is targeting. The cost to do animations "is in the hundreds of thousands," Halvorson said. "This type of set-up is orders of magnitude smaller." In the U.S., Oreo will use the tool for product pages on Amazon (AMZN.O), opens new tab and Walmart (WMT.N), opens new tab in November. Mondelez plans to use the tool in the coming months for Lacta chocolate and Oreo in Brazil, and Cadbury in the UK, Halvorson said. Tina Vaswani, vice president of digital enablement and data for the company, said humans will always check what the tool produces to avoid any mishaps. Mondelez has rules prohibiting highlighting unhealthy eating habits, vaping, over-consumption, emotionally manipulative language and the use of offensive stereotypes, according to a document shared by the Chicago-based company. Reporting by Jessica DiNapoli in New York; Editing by Aurora Ellis Our Standards: The Thomson Reuters Trust Principles., opens new tab * Suggested Topics: * Artificial Intelligence Jessica DiNapoli Thomson Reuters New York-based reporter covering U.S. consumer products and the companies that make them, and the role they play in the economy. Previously reported on corporate boards and distressed companies. Her work has included high-impact stories on CEO pay, Wall Street bubbles and retail bankruptcies.

Oreo-maker Mondelez to use new generative AI tool to slash marketing costs

Snack maker Mondelez is using a new generative AI tool to cut costs for the production of marketing content by 30% to 50%, a senior executive told Reuters. The packaged food manufacturer began developing the tool last year with IT firm Accenture and expects that it will be capable of making short TV ads that would be ready to air as soon as next year's holiday season, and potentially for the 2027 Super Bowl, said Jon Halvorson, Mondelez's global senior vice president of consumer experience. The Cadbury chocolate producer has invested more than $40 million in the tool, Halvorson said, adding that savings would grow if the tool is able to make more elaborate videos. Faced with tariffs and shrinking shopper budgets, Mondelez, like other consumer goods companies, is looking to adopt AI to slash fees paid to advertising agencies and speed up how long it takes to develop and sell new products. Rivals such as macaroni-and-cheese maker Kraft Heinz and Coca-Cola have also been trying out AI for ads. Coke in 2024 ran AI-created holiday ads, though the computer-created people in them were ridiculed by some consumers for lacking real emotion. Mondelez is not yet putting human likenesses in its AI-created content. It is using content generated by the new tool on social media for its Chips Ahoy cookies in the U.S. and Milka chocolate in Germany. An eight-second Milka video shows waves of chocolate rippling over a wafer, along with different backgrounds depending on which consumer Mondelez is targeting. The cost to do animations "is in the hundreds of thousands," Halvorson said. "This type of set-up is orders of magnitude smaller." In the U.S., Oreo will use the tool for product pages on Amazon and Walmart in November. Mondelez plans to use the tool in the coming months for Lacta chocolate and Oreo in Brazil, and Cadbury in the UK, Halvorson said. Tina Vaswani, vice president of digital enablement and data for the company, said humans will always check what the tool produces to avoid any mishaps. Mondelez has rules prohibiting highlighting unhealthy eating habits, vaping, over-consumption, emotionally manipulative language and the use of offensive stereotypes, according to a document shared by the Chicago-based company.

Mondelez will use AI to market Oreos and other snack foods

For many people, the Super Bowl is as much (or more) about the commercials as it is for what's happening on the gridiron. By 2027, though, some of those ads might be dreamed up not by marketing wizards at advertising agencies, but by large language models. Mondelez, the snack food giant that counts Oreo, Chips Ahoy, Ritz crackers, Triscuits, Clif bars, and Cadbury chocolate among its brands, is now using a generative AI tool to cut its marketing production costs by as much as 50%. And the company says it expects that tool to be capable of making short TV ads by the holiday season. By the time the 2027 Super Bowl rolls around, it could be positioned to make commercials for that marquee event, Jon Halvorson, Mondelez's global senior vice president of consumer experience told Reuters. That's notable, as more than half of the people who watch the Super Bowl say they enjoy the commercials more than the actual game, according to a 2010 Nielsen report. And more than 40% of those surveyed by Advocado in 2022 said they watch the Super Bowl exclusively for the ads. Mondelez is not yet putting human images in AI-created ads, but it is already testing the AI-generated ads on social media in the U.S. and plans to use it for Oreo product pages on Amazon and Walmart. This is an expansion of the company's experiments with AI. Last year, it announced that food scientists were using the technology to help them come up with new flavors, based on desired flavor, aroma or appearance profiles. The AI not only suggested recipe ideas, it examined the cost to manufacture the new product as well as things like the nutritional profile and the environmental impact of making the snack. That increased the speed of creating new products by anywhere from two to 10 weeks. At the time, Mondelez said the AI tool was used to "[codify] some of the things developers are really thinking about when they are developing a product"

Oreo-maker Mondelez will use a new generative AI tool on marketing ads next year

Snack maker Mondelez is using a new generative AI tool to cut costs for the production of marketing content by 30% to 50%, a senior executive told Reuters. The packaged food manufacturer began developing the tool last year with IT firm Accenture and expects that it will be capable of making short TV ads that would be ready to air as soon as next year's holiday season, and potentially for the 2027 Super Bowl, said Jon Halvorson, Mondelez's global senior vice president of consumer experience. The Cadbury chocolate producer has invested more than $40 million in the tool, Halvorson said, adding that savings would grow if the tool is able to make more elaborate videos. Faced with tariffs and shrinking shopper budgets, Mondelez, like other consumer goods companies, is looking to adopt AI to slash fees paid to advertising agencies, and speed up how long it takes to develop and sell new products.