unilever

SUBMITTED TO: MS.ERAJ GROUP MEMBERS: ERUM FAROOQUI 12 KANWAL TAHIR 21 QURRAT.UL.AIN IRSHAD 75

CONTENT: * Background.

* Head Office

* Vision.

* Mission.

* Unilever Key Facts.

* Unilever Portfolio.

* Product and Service Analysis.

* Unilever’s Marketing Strategy.

* Unilever’s Operational And Distributional Strategy.

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BACK GROUND In the 1890s, William Hesketh Lever, founder of Lever Bros and later Lord Leverhulme, wrote down his ideas for Sunlight Soap – his revolutionary new product that helped popularize cleanliness and hygiene in Victorian England. “It was toward make cleanliness commonplace; to lessen work for women; to foster health and contribute to personal attractiveness, that life may be more enjoyable and rewarding for the people who use our products (Unilever Company Website, 2008)”.
Founded in 1930 and based in United Kingdom, Unilever is one of the world’s leading suppliers of fast moving consumer goods across Foods and Home and Personal Care categories. Unilever’s portfolio includes some of the world’s best known and most loved brands.
Since it was founded, Unilever established new business in several countries, such as United Kingdom, Germany, Spain, USA, Argentina, Turkey, Netherlands, Canada, China, South Africa, Italy, Sweden, Brazil, Russia, and Czech Republic and operated its own production factory in 158 strategic locations in those countries. For competing in foreign market, Unilever owned 316 subsidiaries worldwide and until 2008, Unilever has launched about 900 different brands.
HEAD QUARTER
The company’s head quarter is in United Kingdom. The head office controls all the activities of the company. VISSION
To bring wealth of knowledge and international expertise to the service of local consumers and to help people around the world meet everyday needs for nutrition, hygiene and wellbeing.
MISSION
Mission is to Add Vitality To Life. To Meet Every day Needs For Nutrition, Hygiene and Personal Care With Brands That Help People Feel Good, Look Good and Get More out of Life.
UNILEVER KEY FACTS
Unilever is one of the world’s leading suppliers of fast moving consumer goods across Food and Home and Personal Care categories.

The Unilever Group manufactures a wide range of consumer products including packaged food, weight management products, personal and household care. It splits its business activities into two divisions, Foods and Home & Personal Care: the cosmetics and toiletries business comes under the Personal Care subdivision, its largest in terms of revenue generation.
The diversity of Unilever’s cosmetics and toiletries portfolio, which encompasses some of the world’s leading brands such as Rexona, Dove and Axe/Lynx/Ego, contributes to its success in the global market. The company also owns a number of successful regional brands such as Lifebuoy. In recent years Unilever has increasingly turned to focus on strengthening its position in the mass market.
It is a global food and consumer goods giant that serves over 2 billion consumers every day in more than 180 countries around the world, but Unilever’s global management team is convinced that the key to their future success lies in 16 emerging markets, of which Pakistan is one.
UNILEVER PORTFOLIO House hold Care | FabricCleansing | SkinCleansing | Skin CareAndPersonal Grooming | OralCare | HairCare | SPREADS | Tea Based Beverage | VimRin | WheelSurf Excel | LuxLifeboyDove | Fair & LovelyPond’sRexonaVaselineLakmeAxe | PepsodentCloseUp | DoveSunslikClear | Blue BandDalda plana | Lipton’s Yellow LabelTaaza and Richbru Brook Bond’s Supremekenya Mixture |

Unilever brands are on sales in 151 countries with 1677 employees, 4171 share holders and a revenue of around 40.187 billion.

PRODUCT AND SERVICE ANALYSIS
It’s important to identify company’s resource strengths and weaknesses and its external opportunities and threats, commonly known as SWOT analysis. This analysis provides a good overview of whether the company’s overall situation is fundamentally healthy or unhealthy. Therefore, for a company’s strategy to be well-conceived, it must be:
- Matched to its resource strengths and weaknesses
- Aimed at capturing its best market opportunities and erecting defenses against external threats to its well-being.

STRENGTH Strong portfolio – Unilever has an extensive portfolio of cosmetics and toiletries products, owning some of the world’s leading brands, including Dove, Sunsilk, Rexona and Axe/Lynx/Ego. Through a successful brand diversification strategy, these brands have been extended into new fast-growing sectors, which has helped strengthen the image of its world-leading brands. Successful restructure – the ongoing implementation of Unilever’s “One Unilever” restructuring programmed including a switch from brand management to sectoral management seems to be working. This move should free up additional funds to invest in existing brands.

Global brand strategy – Unilever’s focus on building core global brands is in keeping with the current trend in global consumables marketing, which stands it in good stead against its multinational competitors. Geographic and sectoral diversity – the company has a wide global presence, allowing it to benefit from growth markets, which helps to offset maturity in others. Similarly, the company’s diverse portfolio, spread across a range of cosmetics and toiletries sectors and geographical markets, acts as a cushion against market contraction in one particular area. Market leading positions – Unilever is the leading bath and shower products and deodorants marketer in the world, as well as in its domestic Western Europe, Eastern Europe, Latin America and Africa and the Middle East. The successful launch of Axe in North America in 2003 has significantly improved the company’s standing in the important North American men’s grooming products sector. Brand development and marketing – Unilever is very advanced in its advertising and marketing program and very active in in-store displays, which is a must for success in cosmetics and toiletries. In many of Unilever’s largest sectors, the company’s wide presence has been built on successful product innovation with the timely introduction of brand extensions well suited to changing consumer preferences. Quicker product development – efforts are underway to shorten the time spent rolling out new products, which will contribute towards Unilever increasing its flexibility to respond to changing consumer demands and keep ahead of the competition. Focus on mass market – the sale of its premium beauty business to Coty in May 2005 will allow Unilever to concentrate on strengthening its position in the mass market. More efficient operational structure – changes to Unilever’s internal structure, with increasingly centralized and globally-managed divisions, have led to increasing synergies within the business, such as in its distribution activities. Ongoing restructuring will further reduce operating costs across the company.
WEAKNESS
Lack of industry focus – the diversity of Unilever’s overall portfolio, which includes packaged food and household care products, means that cosmetics and toiletries may not get the resources it needs when a sudden change in demand happens, and also may impede the speed at which new products get to market. Absence from premium market – the company has focused on the mass-market channel with the sale of its prestige beauty business to Coty in May 2005. This rule out the opportunity for the company to benefit from the growing trend towards premiumization.

Lack of major patent – although Dove’s 25% moisturizing ingredients content is a strong selling point, Unilever does not own a significant patent such as those owned by rivals L’Oreal and Procter & Gamble, which respectively own Dermo-Expertise Refinish Micro-Dermabrasion and Pantene Pro-V’s pro-vitamin B complex technology. Fragmentary sectoral involvement – the company is involved in several non-core cosmetics and toiletries sectors, namely sun care, baby care and color cosmetics, which do not bring in enough revenue to warrant their position in Unilever’s portfolio in light of its current focus on core brands. Non-core brands risk neglect – focus on its six core brands means that smaller brands and other product sectors are in danger of being overlooked in terms of marketing support.
OPPORTUNITY
Widening consumer base – Unilever is attracting a wider consumer base through the expansion of its brands and geographic markets. This is particularly significant in the increase in products designed specifically for men, such as Rexona for Men and Axe, whilst Lynx in the UK has proved particularly popular with younger males in the 17-34 age groups. The ongoing growth of men’s grooming products is likely to bear further positive results for the company’s activities in this sector. v Presence in dynamic product sectors – the company’s involvement in sectors such as sun care and baby care, though currently small, gives Unilever the potential to benefit from these fast-growing sectors in the future. v Products for an ageing population – Unilever will continue to benefit from the world’s changing demographics, with nourishers/anti-agers and firming skin care products becoming increasingly popular as the number of mature women grows as well as their spending power. With a strong presence in both face care and body care, the company is in a strong position to capitalize from this trend.
Stronger, focused hair care portfolio – the simultaneous divestment of Aqua Net and Finesse, and the global roll-out of Sunsilk shampoo and conditioner, as well as new formulations for Suave and Dove in hair care, will help Unilever exploit strong growth anticipated in hair care.
Demand for mass-market products – growing global urbanization will continue to drive demand for products in the mass market, such as those provided by Unilever.
Potential of developing markets – Latin America, one of Unilever’s key markets, is in full expansion and is expected to remain one of the most dynamic in cosmetics and toiletries over the forecast period Potential of developing markets – Latin America, one of Unilever’s key markets, is in full expansion and is expected to remain one of the most dynamic in cosmetics and toiletries over the forecast period Building on brand equity – a recent survey in the UK revealed several Unilever brands to be amongst the most trusted as far as UK consumers are concerned. Ongoing corporate branding activity should help drive this message further across all Unilever’s areas of interest.

THREATS
P & G is the major competitor and threat for Unilever. Other organized players are Nestle and R & B.
Unilever is facing intense competition from unorganized players i.e. cheaper smuggled products and Chinese products. According to industry source, 40% of tea consumed locally and a large portion of HPC products are smuggled into the country.
Legal, political and regulatory factors of host country. For example, supportive Government policies for attracting FDI,1% tax rate on corporate profit and inability of Pakistan Government to control smuggled products etc.
Although UNILEVER has a first mover advantage in ice cream segment but Engro has announced to enter in ice cream segment and is considering a big rival post CY2010.
Rapid increase in raw material cost and supply disruptions from suppliers of raw material. The unprecedented surge in palm oil, tallow prices and other materials has resulted in declining margins. Going forward, high raw material costs are a key risk to Unilever profitability.

UNILEVER’S MARKETING STRATEGY
For its marketing strategy Unilever combines its strategy with social project in many countries. Educational campaigns have been important tools for raising awareness for Unilever brands such as Close-Up and Dove. The company’s partnership with the World Dental Federation has seen it become involved in oral healthcare projects in both developed and emerging nations, including Austria and Brazil. In 2006, Unilever developed a low-cost toothbrush, the Pepsodent Fighter.
The company also has more directly brand-related programs, including Close-Up’s Project Smile. which used small kiosk outlets to showcase both its products and oral hygiene information, and the Dove Self-Esteem Fund.
The company’s successful brand innovation program is supported with a high level of marketing and advertising activities including most media. Investment in advertising and promotions increased by nearly EUR300 million.
. A central idea behind the company’s product development and marketing strategy is that of “Vitality”: essentially producing products that are felt to be life-enhancing, to make consumers “feel good, look good and get more out of life”.
UNILEVER’S OPERATIONAL AND DISTRIBUTIONAL STRATEGY
Unilever distributes its products through its own sales force, as well as independent distributors, wholesalers, agents and a range of business-specific channels such as foodservice distributors and independent grocers. In addition, special distribution channels exist to supply the company’s largest customers.
The company operates a number of warehouses, depots and storage facilities, and also uses third party operations where appropriate.
Unilever is likely to have many profit sanctuaries. Company with multiple profit sanctuaries like Unilever has competitive advantage over companies with a single or few sanctuaries.
Unilever has a strong global presence with a good spread between large but mature markets and smaller, high-growth ones. In recent years, the company successfully grew its cosmetics and toiletries business in a number of developing markets, most importantly Asia-Pacific. This region continues to be of great importance for the company with increasing focus on fast-growing markets such as China, India and Indonesia. The company has also focused on Latin America, achieving the top spot in the cosmetics and toiletries markets of a number of countries including Argentina and Chile. Eastern Europe has been less of a focus for Unilever, with the company ranking fifth in 2006, its lowest regional ranking, but Russia has been identified as a key growth market for the company.