A Summary of UNILEVER’s Strategic

Approach

By
Tashrima Chowdhury
Department of Accounting,
Bangladesh University of Business & Technology (BUBT)

Date – 5th August, 2018

 Table of Contents

 Introduction

 Core Competencies

 Success Factors & Regional Based Strategies

 Major Competitors

 How Do They Perform Well?

 Problems

 Recommendation for Future

 Conclusion
 Introducing: Unilever

Type: Dual-listed
Public limited company
Industry: Consumer Goods
Predecessor: Lever Brothers
Margarine Unie
Founded: 1930 (by merger)
Founders: William Lever,
1st Viscount Leverhulme
James Darcy Lever
Samuel van den Bergh
Headquarters: Unilever House, London, UK
Rotterdam, Netherlands
Area Served: Worldwide
Key People: Marijn Dekkers
(Chairman)
Paul Polman
(CEO)
Products: Foods, beverages, cleaning
agents and personal care
products
Number of 169,000 (2017)
Employees:
Revenue: €53.715 billion (2017)
Website: www.unilever.com
History & Founders
Unilever is a British-Dutch transnational consumer goods company co-
headquartered in London, United Kingdom and Rotterdam, Netherlands.
Its products include food, beverages, cleaning agents and personal care
products. It is the world's largest consumer goods company measured by
2012 revenue, and is also the world's largest producer of food spreads, such
as margarine. It is Europe’s seventh most valuable company. Unilever is one of
the oldest multinational companies; its products are available in around 190
countries.
Unilever owns over 400 brands, with a turnover in 2016 of over 50 billion euros,
and 13 brands with sales of over one billion euros: Axe/Lynx, Dove, Omo,
Becel/Flora, Heartbrand ice creams, Hellmann's, Knorr, Lipton, Lux, Magnum,
Rama, Rexona/Degree, Sunsilk and Surf.

Unilever was founded in 1930 by the merger of the Dutch margarine producer
Margarine Unie and the British soap-maker Lever Brothers. Unilever was
one of the world’s first genuine multinationals with operating companies in
more than 40 countries.
The company produces and distributes a vast number of well-known brands
in the areas of nutrition, hygiene and personal care that are used by
consumers all over the world.
Lever Brothers was a British manufacturing company founded in 1885 by
brothers William Hesketh Lever (1851–1925) and James Darcy Lever
(1854–1916). They invested in and successfully promoted a new soap-making
process invented by chemist William Hough Watson. Together with James
Lever, William Lever opened soap factory at Warrington, England, in
1885.Their product, Sunlight, the world’s first packaged soap, was very
successful.

Margarine Union Limited was a Dutch company formed in 1927 in

Rotterdam by the merger of four margarine companies, Antoon Jurgens
United, Van den Bergh's, Centra, and Schicht's. Two large companies, Jurgens
and Van den Bergh were founded in 1872, Netherlands. The two companies
began profit sharing in 1908.
Schicht was founded by Georg Schicht whose son Johann Schicht was an
owner of a large soap-making plant. Margarine Unie operated until 1930
when it merged with the British company Lever Brothers, to form the
multinational Unilever.

In the 1930s, business grew and new ventures were launched in Africa and
Latin America. In 1943, it acquired T. J. Lipton, a majority stake in Frosted
Foods and Batchelors Peas, one of the largest vegetables canners in the UK.
In 1944, Pepsodent was acquired.
Sunsilk was first launched in the UK in 1954. Dove was first launched in the
US in 1957. Unilever took full ownership of Frosted Foods in 1957, which it
renamed Birds Eye.
During the second half of the 20th century the company increasingly
diversified from being a maker of products made of oils and fats, and
expanded its operations worldwide. It has made numerous corporate
acquisitions, including Lipton (1971), Brooke Bond (1984), Chesebrough-
Ponds (1987), Best Foods (2000), Ben & Jerry's (2000), Alberto-Culver
(2010), and Dollar Shave Club (2016).
By the end of the 1970s, through acquisitions, Unilever had gained 30 per cent
of the Western European ice cream market. By the beginning of 1980s
Unilever became 26th largest company in the world. In 1982, Unilever
management decided to reposition itself from an unwieldy conglomerate to a
more concentrated FMCG company.
In 1990s the company changed the strategy abruptly: the strategy of brand
portfolio diversification was replaced with the strategy of focusing on key
products and best-selling markets with high growth potential. By the end of
20th century Unilever decreased the number of marketed product categories
from 50 to 13.At the same time, the company launched first environmental
efficiency programs.
In 2015, under leadership of Paul Polman, the company started gradually
shifted its focus towards health and beauty brands and away from food
brands showing slow growth.

In March 2018, the company announced that its headquarters will be moved
completely to Rotterdam.
A list of Unilever’s most famous brands and products are given below –

Billion-euro brands
Axe/Lynx Heartbrand
Omo/Surf Excel/Persil/Breeze Hellmann's and Best Foods
Rama Knorr
Dove Lipton
Flora / Becel Rexona/Sure/Degree/Shield
Lux Surf
Magnum Sunsilk

Others –
Alsa Bushell's Lao Cai Aviance Persil
Amin Calvé Lady’s Choice Badedas Pond’s
Amora Chicken Lipton Ice Tea Breeze Q-Tips
Tonight
Annapurna Choysa Lizano Sauce CLEAR Shield
Aromat Colman's Lyons Close-Up Signal
Becel/Flora Conimex Maille Comfort Prodent
Ben & Jerry's Continental Maizena Dollar Shave Sunlight
Club
Best Foods Country Marmite Fair & Lovely Timotei
Crock
Blue Ban Darko Pot Noodle Impulse TRESemmé
(Дарко)
Bovril Delma McCollins Lakmé Vaseline
Breyers Du Darfst Mrs. Filbert's Lifebuoy Ultrex
Brooke Bond Elmlea Paddle pop Lynx Vim
Bru Good Luck Scottish Omo Wheel
Blend
Brummel & PG Tips Pears Soap White
Brown Beauty
Buavita Klondike Phase Pepsodent Toni & Guy
Vision & Mission
Unilever’s corporate vision is “to make sustainable living commonplace. We
believe this is the best long-term way for our business to grow.”
The explanation of the Vision and Mission statement provided by Unilever is
as follows:
“Our distinct Purpose and our operational expertise across our business model
will help realize our vision to grow our business, whilst decoupling our
environmental footprint from our growth and increasing our positive social
impact. This is captured in the Unilever Sustainable Living Plan.
By combining our multinational expertise with our deep roots in diverse local
cultures, we’re continuing to provide a range of products to suit a wealth of
consumers. We’re also strengthening our strong relationships in the emerging
markets we believe will be significant for our future growth.

"We cannot close our eyes to the challenges that the world faces.
Business must make an explicit and positive contribution to addressing
them. I’m convinced we can create a more equitable and sustainable
world for all of us by doing so,” says Unilever CEO Paul Polman.

“But this means that business has to change. The Unilever Sustainable
Plan is a blueprint for sustainable growth.”

“The USLP is a value driver in its own right. Our commitment to the USLP’s three
big goals of improving health and well-being for more than 1 billion people by
2020, halving our environmental footprint by 2030, and enhancing livelihoods
for millions by 2020 has delivered growth for the business. In 2016, 18 of our top
40 brands qualified as Sustainable Living brands, growing 50% faster than the
rest of the business, while delivering more than 60% of Unilever’s growth. Their
success is driven by the growing consumer demand for brands that have purpose
at their core. “
Unilever’s corporate mission is “to add vitality to life. We 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.”

This mission statement underscores how the company satisfies customers in

various aspects of their lives. The following are the significant components in
Unilever’s mission statement:

1. Adding vitality to life

2. Meeting everyday needs for nutrition, hygiene, and personal care
3. Helping people feel good, look good, and get more out of life

Adding vitality to life is a general indicator of business strategy in Unilever’s

corporate mission statement. Such vitality is the value that consumers can
expect from the company’s products. The corporate mission also specifies the
aspects of life where such vitality is added. For example, Unilever’s food
products address consumers’ vitality needs in terms of nutrition.
Furthermore, through these products, the company attracts customers who
want to feel good, look good, and get more out of life. The mission statement’s
specification of the types of products provides a foundation for the product
mix in Unilever’s marketing mix.
Unilever’s mission statement includes detailed information of what the
business does and must do. For example, the company adds vitality to life
through products that address consumers’ needs in nutrition, hygiene, and
personal care. In this regard, the corporate mission statement satisfies
standards that require specificity on general strategic approaches. However, a
recommendation is to enhance Unilever’s mission statement by adding more
information on how the company strategically achieves its aims in adding
vitality to consumers’ lives.
 Core Competencies
A core competency is a concept in management theory introduced by C. K.
Prahalad and Gary Hamel. It can be defined as "a harmonized combination of
multiple resources and skills that distinguish a firm in the marketplace" and
therefore are the foundation of companies' competitiveness.
The most important advantage of having core competencies is having a long
term competitive advantage. These competencies help in bridging the gap
between performance and opportunity, thus helping a company in being a
potential leader in the industry.

Core
Competencies
Unique
Features Sophisticated
Technology

Brand Value
Skilled
Manpower
Working
Environment

These features enhance a company’s success and are named as Core

Competencies. The following discussion describes Unilever’s core
competencies in light of these features –

Unique Features
For any ordinary company, a 32 percent cut in energy-related emissions from
manufacturing, or an 11 percent reduction in packaging waste sent to landfill,
might sound like decent, but hardly revolutionary, progress.
But consumer goods giant Unilever is no ordinary company. These
achievements, detailed in the latest update to the Unilever Sustainable
Living Plan (USLP) might be moderate in percentage terms, but because of
Unilever's sheer size – one might say its unileverage– they represent major
absolute savings.
For Unilever, with nearly €50 billion in sales in 2013, size matters. USLP
implementation can affect whole markets. The USLP also recognizes that
Unilever has the weight to secure sustainability gains by pushing for
widespread consumer behavior change.
The company is working on products with reduced environmental impact in
their use phase. One example highlighted in the updated USLP is a compressed
deodorant, which halves propellant use and can be fitted into smaller
canisters, reducing demand for packaging materials. The company has also
started an international motivational campaign, Project Sunlight, to promote
more sustainable behavior.
In fact, Unilever is extending its pledges to boost sustainability beyond its own
operations. The updated USLP says the company will work to end
deforestation, work with small-scale farmers worldwide on sustainable
agriculture, and help more than a billion people gain access to clean water.
For a consumer goods producing company, to promote Sustainable Living
Plan and environment friendly manufacturing is sure to give Unilever a more
unique approach in the eye of the consumers.

Brand Value
A corporate brand is a product of an organization's corporate strategy,
mission, image, and activities that distinguishes an organization from its
competitors, and creates a perception of what an organization stands for.
Like many other trusted companies Unilever has succeeded in establishing
long term relationship with customers all around the globe. Today Unilever is
world’s third largest Goods Company around the globe. Unilever products
are successfully available in almost 190 countries.
Why Unilever is world’s most successful company? Why everyone is willing to
buy Unilever brand without any ambiguity. The reason is a Unilever core
concept regarding brand value is customer satisfaction and providing the best
product to the customers in all the way. The fine thing is that Unilever brands
consist of many local and regional verities that lead to meet customer
satisfaction in many ways. The superb element of Unilever is that products are
associated with deep knowledge about every culture.
Unilever believes that customer satisfaction is the backbone for every
business performance. Therefore company focuses on most consumers. In
addition, Unilever have a combination of different brand portfolio and able to
meet the demand of domestic, homemade and personal care consumers.
The most successful element of Unilever brand is it helps people look worthy,
feel pleasure and get more standard in people’s lives. Therefore many of
Unilever products are available as daily consumer goods in the market. It has
proven that Unilever has successfully achieved customer satisfaction by
offering reliable, trustworthy, top brands in almost every part of life.

Working Environment
Unilever was named one of Human Rights Campaign’s “Best Places to Work”,
achieving a perfect score of 100 percent on the organization’s 2013 Corporate
Equality Index for the fifth year running. The ranking recognizes the
company’s commitment to diversity and inclusion in the workplace,
marketplace and community.
However, over the past few years, there are some criticism against Unilever
for violating human and worker rights in some regions, mainly in South Asian
regions. Situations like mercury exposure in India, labor abuses in palm oil
supply chains, worker rights issues in factory in Vietnam are to name a few.
In August 2017 Ethical Consumer viewed the April 2016 "Behind the brand"
scorecard produced by Oxfam as part of its GROW campaign which sought to
evaluate the world's top 10 most powerful food and beverage companies. The
campaign aimed to challenge companies to begin a "race to the top" to
improve their social and environmental performance.
Unilever was ranked 1st out of 10 companies in the scorecard. Overall the
company scored 74% and was rated 'fair' by Oxfam. This gave Unilever a
chance to redeem its image regarding working environment worldwide.
Despite these controversies, Unilever is one of the most desired companies
people want to work in. The whole package Unilever offers to its employees
are very attractive.

Skilled Manpower
The human resource (manpower) is considered the most critical to any
organizational survival with adequate supply of materials and financial
resources. The company encourages its employees to sustain high behavior
standards in their daily work, corresponding to the company’s values:
integrity, respect, responsibility, and the manifestation of pioneering spirit.
Sustainable profitable growth can be reached if the company would have
people with a winning mind set, a passion for consumers and an appetite to
drive personal performance. Standards of Leadership are behaviors Unilever
expects to see in its employees, because they drive company’s performance
and culture.
Qualities like growth mindset which is a positive, yet realistic, attitude about
the company’s future; consumer and customer focus which is purpose-driven
leadership; and accountability and responsibility which is performance-driven
leadership. Unilever launched Building Talent & Teams program which is
people-driven leadership. It means investing in people’s development and
building teams that work together to achieve company goals.

Sophisticated Technology
Since its launch in the 1930s, Unilever has been providing the world with
products which are technologically advanced and innovative. Product design
teams take uses the breakthroughs in science and technology by turning
unique insights into the products that consumers’ want and need. The
company uses the latest technology in its production process and creates new
methods for more efficient production.
Unilever unveiled its ground-breaking new technology to recycle sachet waste
in 2017. This technology, called CreaSolv® Process, has been developed with
the Fraunhofer Institute for Process Engineering and Packaging IVV in
Germany and is inspired by an innovation used to recycle TV sets.
Innovation is at the heart of Unilever’s ambition to grow sustainably. Science,
technology and product development are central to the plans to keep
providing consumers with great brands that improve their lives while having
a positive impact on the environment and society.
Product design teams take our breakthroughs in science and technology one
step further, turning unique insights into the products that consumers want
and need. Development and testing of new technology takes place until it fits
the product description - perfecting a formulation so that it looks great and is
stable when stored.

Core competencies enhance a company’s features and product line and helps
generate a good market position. To achieve competitive advantage in the
market, Unilever must maintain these core competencies in the long term.
 Success Factors & Regional Based Strategies
As one of the strong and healthy companies in the world with many successful
brands, Unilever has an opportunity to expand into foreign markets in order
to gain access to customers around the world. In fact, 150 million times a day,
someone somewhere chooses Unilever products.
Unilever firstly entered in foreign market to compete internationally by
entering just one or select few foreign markets. Once successfully introduced
its product in several market, Unilever expands its success brand to many
other markets and starting to compete globally. In entering and competing in
foreign markets for its cosmetics and toiletries product, Unilever follows a
global strategy, also called by a think-global and act-global strategy.The main
success factor of the company is the constant focus on innovative product
developments.

Key Success Factors

The success factors of Unilever can be explained by three categories which are
further divided into sub-categories:

 Customers: Customer satisfaction is pivotal in any organization’s

success.
 Quality Products: Unilever is emphasizing the quality and
superiority of its products. Unilever provides products with
utmost durability and maximum effectiveness.
 Attractive Prices: Unilever maintains a wide variety of price
points, considering the level of diversification of its
products. Unilever uses competitors’ pricing to determine the
most appropriate prices.
 Environment Friendly Product: Unilever make their
manufacturing process as efficient as possible – using fewer
resources and generating less waste. Reducing the environmental
impacts of manufacturing – eco-efficiency – is a key part of the
Unilever Sustainable Living Plan (USLP).
  Wide Accessibility: Accessibility helps brands grow through
increased sales to existing customers and acquisition of new
customers. Unilever is arguably the most widely accessible and
used product brand in the world.
 Healthy Products: Unilever has a long heritage of quality food
and drink products. Unilever is the world’s no. 1 professional
skincare brands as it continues to add to its long list of health and
beauty brands.
 Competition: Knowledge about competitors can significantly help the
company.
 Superior Quality: Meeting quality expectations of the consumers
into Unilever’s products is a priority. Products with superior
quality help Unilever to gain significant advantage over
competitors.
 Cost Leadership: Unilever compete for a wide range of customers
based on price. In order to become a cost leader, Unilever should
keep an eye on the price strategy followed by its competitors and
its continuous efforts to keep its prices low relative to its
competitors.
 Packaging: Unilever’s packaging is functional and attractive,
while keeping the impact on the environment as minimal as
possible.
 Brand Equity & Awareness: Unilever brands consist of many
local and regional varieties that lead to meet customer satisfaction
in many ways.
 Distribution Channel: Distribution channel and network of
Unilever is very efficient. The experience of 88 years in consumer
products and knowledge about customer behavior help the
corporation to gain an effective distribution network.
 Advertisement: Unilever’s commitment to responsible marketing
and advertising as a leading global consumer goods company
gained a larger consumer base. They promote the benefits of their
products using many different channels of brand communication.
  Corporation: Having the necessary resources and financial backup
sufficiently is very important.
 Revenue: The revenue of Unilever for 2017 was €53.715 billion,
which is the third largest revenue number in consumer goods
producing corporations.
 Low Cost Operation: Unilever’s operations management is
responsible for keeping high productivity throughout the global
organization of the consumer goods business. Using low cost but
high quality production strategy helps provide a good pricing
strategy.
 Innovation & R&D: More than 6,000 scientists, engineers, chefs
and technicians work in Unilever's R&D centers around the globe
- inventing new products and improving existing products to
delight consumers everywhere.
 Technology: Science, technology and product development are
central to Unilever’s plans to keep providing consumers with
great brands that improve their lives while having a positive
impact on the environment and society.
 Relations with Suppliers: The Unilever Supplier Qualification
System (USQS) is for all suppliers of products and services to
Unilever. Unilever believe that working with principles and values
will help suppliers to operate in an ethical, fair and legal way that
will facilitate good practices across the entire supply chain of
suppliers.

These key factors played a significant and important role in Unilever’s success
over the years. By improving and making continuous developments in these
sectors, Unilever has gained the position it holds today.
Regional Based Strategy
Unilever has a strong global presence with a good spread between large but
mature markets and smaller, high-growth ones. 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.
Through the One Unilever structure, the consolidation of regional supply
chain management into a single organization means that sourcing activities
from procurement through to primary distribution are being managed from
one organization.
Overall, 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.
To win customers and sales away from select rivals in country markets,
Unilever employ cross-market subsidization. This offensive strategy is
appropriate for Unilever which is compete in multiple county markets with
multiple brands and wide variety of products. Unilever’s wide sector presence
means that the company faces fierce competition from a number of
multinationals.
In entering the emerging-country market Unilever prepare to compete on the
basis of low prices. Consumers in emerging markets are often highly focused
on price, which can give low-cost local competitors the edge unless a company
can find ways to attract buyers with bargain prices as well as better products.
When it entered the market for laundry detergent in India, Unilever realize
that 80% of the population could not afford the brands it was selling to
affluent consumers there.
Therefore, to compete against a low-priced detergent made by a local
company, Unilever came up with a low-cost formula that was not harsh to
the skin, constructed new low-cost production facilities, packaged the
detergent in singled-use amounts so that it could be sold very cheaply. The
new brand quickly captured $ 100 million in sales and was the number one
detergent brand in India in 2004 based on dollar sales. Unilever later
replicated the strategy with low-priced packets of shampoos and deodorants
in India and South America.
The 2017 operational review based on Region/Geographical area are shown
in the chart below –

Full Year Operational Review: Geographical Area

Fourth Quarter 2017 Full year 2017
Turnover USG UVG UPG Turnover USG UVG UPG Change in
underlying
operating
margin
(unaudited) €bn % % % €bn % % % bps
Unilever including 12.8 4.0 3.2 0.7 53.7 3.1 0.8 2.3 110
spreads
Asia/AMET/RUB 5.6 6.5 4.2 2.2 23.3 5.9 2.1 3.7 200

The Americas 4.2 3.4 3.4 - 17.5 2.4 0.2 2.2 50

Europe 3.0 0.3 1.3 (1.0) 12.9 (0.7) (0.5) (0.2) 60

Notes: USG=Underlying sales growth; UVG=Underlying volume growth; UPG=Underlying price growth.

Asia/AMET/RUB
Underlying sales increased by 5.9%, with accelerated volume gains in the
second half of the year and good performances for ice cream, cooking
products and fabric conditioners. India performed strongly, driven by
improved volume growth after the Goods and Services Tax implementation
while price growth lowered as the benefits of the tax change were passed on
to consumers.
Growth in China picked up due to rapidly expanding e-commerce sales and
new product launches. Turkey and Pakistan delivered double-digit growth
across all categories while sales growth in Thailand, South Africa and
Indonesia remained below historic levels reflecting challenging market
conditions.
Underlying operating margin was up 200bps driven by increased gross
margins and brand and marketing investment efficiencies.

The Americas
Latin America returned to volume growth in 2017, driven by strong
performances in Mexico and Argentina. Price growth was well below recent
years as currencies and inflation rates have stabilized in most countries. The
sales decline in Brazil, where some consumers had switched to value brands,
has slowed as economic conditions are starting to improve after several years
of recession.
Underlying operating margin improved by 50bps as a result of higher gross
margin in North America.

Europe
Markets remained challenging with subdued volume growth and continued
price deflation in several countries, which led to a modest sales decline in
Europe. Growth momentum in Home Care improved in the second half of the
year but competitive intensity remained high in Personal Care and Foods.
Central and Eastern Europe continued to perform well, the United Kingdom
returned to growth.
Underlying operating margin was up 60bps primarily due to brand and
marketing efficiencies.
The specific strategy varies from region to region, market to market, but the
main strategy to capture all the markets is more or less the same. The point is
to enter into the markets and successfully maintain a profitable position.
 Major Competitors
No business is an island. For success, the business will need to deal with
customers, suppliers, employees, and others. In almost all cases there will also
be other organizations offering similar products to similar customers. These
other organizations are competitors and their objective is the same: to grow,
make money and succeed. Companies need to gather sufficient knowledge
about their competitors to gain competitive advantage.
Unilever's largest international competitors are Nestlé and Procter &
Gamble. It also faces competition in local markets or specific product ranges
from numerous companies, including Beiersdorf, ConAgra, Danone, Henkel,
Mars, PepsiCo, Reckitt Benckiser and S. C. Johnson & Son.
The table below shows the main competition of Unilever –

Company Name Company Profile Competitive Products

Founded: 1837 Ariel, Gillette, Head &

Revenue: US$65.29 billion Shoulders, Olay, Oral-B,
Procter & Gamble
(2016) Pampers, Pantene, Vicks, Mr.
Co. (P&G) Available: 200 countries Clean,Old Spice etc.
Brands: 70

Founded: 1866 Nescafé, Kit Kat, Smarties,

Revenue: CHF89.8 billion Nesquik, Stouffer's, Vittel,
Nestlé S.A. (2017) Maggi, Nestlé
Available: Worldwide Crunch,Drumstick, Nido,
Brands: 8,500 Coffee-Mate etc.

Founded: 1806 Colgate, Palmolive, Speed

Revenue: US$15.454 billion Stick, Softsoap, Irish Spring,
Colgate-Palmolive
(2017) Protex, Sanex, Ajax, Axion,
Company Available: 180 countries Fabuloso etc.
Brands: 50

Founded: 2015 Kraft, Heinz, ABC, Capri Sun,

Revenue: US$26.232 billion Classico, Jell-O, Kool-Aid,
The Kraft Heinz
(2017) Lunchables, Maxwell House,
Company Available: 100+ countries Ore-Ida, Philadelphia,
Brands: 13 Planters, Velveeta
 Founded: 1886 Coca-Cola,Coca-Cola Zero
Revenue: US$35.410 billion Sugar, Fanta, Sprite, Minute
The Coca-Cola
(2017) Maid, Georgia, Powerade,
Company Available: 200 countries Del Valle, Minute Maid etc.
Brands: 350

Founded: 1898 Pepsi, Diet Pepsi, Mountain

Revenue: US$63.525 billion Dew, Lay's, Tropicana, 7 Up,
PepsiCo, Inc. (2017) Brisk, Cheetos, Mirinda,
Available: 200 countries Aquafina, Propel, Starbucks,
Brands: 200+ Fritos, Walkers etc.

Founded: 1919 Activia, Actimel, Danimals,

Revenue: €24.7 billion (2017) waters including Evian,
Available: 150 countries Aqua, Volvic, Aptamil,
Danone S.A. Brands: 83 Badoit, and medical
nutrition products including
Nutricia.

Founded: 1814 Airborne, Air Wick, Calgon,

Revenue: £11.512 billion Clearasil, Cillit Bang, Veet,
Reckitt Benckiser
(2017) Lysol, Mycil, Vanish etc.
Group plc Available: 130 countries
Brands: 40

Founded: 1909 L’Oréal Paris, Garnier,

Revenue: €26.024 billion Maybelline New York, NYX
L'Oréal S.A. (2017) Professional Makeup,
Available: 170 countries Lancôme, Yves Saint Laurent
Brands: 60+ Beauté,Urban Decay etc.

Founded: 1872 Kleenex, Scott, Huggies, Pull-

Revenue: US$18.259 billion Ups, Kotex, Poise,
Kimberly-Clark
(2017) Depend,Cottonelle etc.
Corporation Available: 175 countries
Brands: 30+

Founded: 2012 Nabisco, Oreo, LU and

Revenue: US$25.92 billion belVita biscuits; Cadbury,
Mondelēz (2016) Milka, Cadbury Dairy Milk
International, Inc. Available: 130 countries and Toblerone chocolate;
Brands: 100+ Trident gum; Halls candy,
and Tang
Competitors are a big part of a company's external environment. Without
competitors, a company cannot find the urge to improve their product or
service. Competitors change the taste and preferences of consumers by
providing new or improved products, which encourages other companies in
the industry to more facilitate their product or service.

The greater the success of the company, the fiercer competition it faces.
Sufficient knowledge about competitors’ product and their strategy can give
Unilever an important leverage in the market. Since Unilever is one of the
biggest multinational FMCG in the world, it has many local and international
competitions. Unilever has to win against the vast ocean of competition to
gain a sustainable market position.
 How Do They Perform Well?
Unilever is one of the greatest consumer goods manufacturing company in
the world. It is a consumer goods manufacturing giant which serves to meet
the needs of millions of hearts worldwide. The wide range of brands are
intended to satisfy different types of consumer wants like food, health,
hygiene, personal beauty, nutrition, homecare and many more.
Unilever operates in nearly 190 countries around the world and has been a
traditional paragon of excellence and quality in the Fast Moving Consumer
Goods sector. The company derives its competitive advantage from its global
footprint and its track record of enhancing value for the consumers around
the world.
Unilever have delivered a good all-round performance with competitive
growth, including an innovation-led improvement in volumes in the fourth
quarter, and substantially increased margin, earnings and cash flow.
Unilever’s overall performance for 2017 in numbers:
 Turnover increased 1.9% to €53.7 billion.
 Underlying sales growth(USG) excluding spreads 3.5%, with price up
2.4% and volume up 1.0%
 Gross margin improved by 40bps to 43.1%.
 Underlying operating margin up 110bps.
 Underlying earnings per share up 10.7%.
 Free cash flow up €0.6 billion to €5.4 billion.
 Net profit increased 16.9% to €6.5 billion

So the main question here is “What makes Unilever so successful?” Unilever is

an example, with sustainability shaping its actions and the way it
communicates its brand, fostering trust in the marketplace. As a company that
reaches 2.5 billion consumers annually, has 169,000 employees, and 76,000
suppliers, this is a huge undertaking with an enormous global impact.
Unilever was already successful since its launch in the 1930s; it added another
crown by announcing the billion dollar strategy called Unilever Sustainable
Living Plan (USLP) back in 2010.
This strategy was an absolute success as the company promised to double its
size but halving its environmental footprint. Unilever CEO described that
asking the right question can help a business generate profit and at the same
time achieve a sustainable future. The point was to think long term, make new
networks, push the customers to think sustainability, changing the long and
old system to create a more suitable future.

So there can be thousands of reasons, initiatives or strategies behind the

tremendous success of Unilever. This is the oldest multinational company
which has 78 years of experience in the business world. To make this more
understandable and timely, the main strengths behind Unilever’s success and
performance are summarized in the points below –

 Unilever operates in nearly 190 countries around the world and hence,
has a global footprint combined with top of the mind brand recall
among consumers worldwide.
 It has a deep and broad portfolio of brands and a diversified product
range, which makes it uniquely, positioned to tap into the changing
consumer preferences across the world.
 Its Research and Development initiatives are heavily funded and
manage to bring to the market innovative and cutting edge products in
tune and in line with consumer preferences.
 Unilever has a distinct competitive advantage over its nearest
competitor, Proctor and Gamble because of its flexible pricing and
expertise in distribution channels that manage to reach the nook and
the corner of the globe.
 The company finds its strengths in leveraging the economies of scale
arising from its breadth of operations as well as synergies between its
many manufacturing facilities, which totaled 270 locations around the
world at last count.
 Unilever combines global thinking with local execution, which means
that it creates global product with distinct local flavor.
 Adapting to changing customers' needs is one of the key points of
Unilever’s success. The transition in marketing strategy of all its brands
with targeted advertising based in regional and cultural differences.
  Unilever’s pricing strategy helped it gain a huge customer loyalty base,
especially in the Asian countries. High quality products with affordable
prices created huge change in customer buying pattern and behavior.
 Unilever has shown flexibility by adapting and changing according to
their customer demand and changing preferences of the consumers.
 There were two main “keys to success” that Unilever adopted to
become a Sustainability-Driven grown company:
 Identifying, accepting, and committing to the need for change.
 Aligning every party involved in the chain to their strategy to
make sure they all moved towards the same goals. Those who
were not on board were left behind.
 Unilever uses its success as a platform to not only sell products but to
reach the heart of its consumer by promoting social awareness and
organizing various awareness campaigns.

Overall Unilever has strong brand name and diverse product lines and strong
global marketing base. There are numerous examples of Unilever using its
branding and marketing reach to create a positive social or environmental
impact, with a tangible benefit on sales. In Argentina, Unilever partnered with
Carrefour to educate consumers on ways to save energy when doing laundry,
resulting in a boost in market share and a 25 percent increase in sales. The
Lifebuoy brand aims to reduce the spread of disease by changing the hand-
washing behavior of 1 billion consumers. Dove’s self-esteem program works
with girls and women to promote a positive body image by changing the
conversation around female beauty.
 Problems
Unilever is one the most successful multinational corporation covering
almost all the countries in the world. The history of excellence and success has
given Unilever the position of a pioneering legend. They have paved the way
for many corporations around the globe. All this success doesn't mean
Unilever doesn't face any problems or doesn't have any shortcomings. Like
any other organization, Unilever has seen some shortcomings in the past
years; some they were able to overcome and some still exists. Unilever face a
number of significant business challenges, risks and organizational problems.
Off the top of my head, here's a few of the more obvious ones:
 Palm oil issues that affected Unilever: Unilever has been criticized by
Greenpeace for causing deforestation. Greenpeace criticized the
company for buying palm oil from suppliers that are damaging
Indonesia's rainforests. By 2008, Indonesia was losing 2% of its
remaining rainforest each year. The United Nations Environmental
Programme stated that palm oil plantations are the leading cause of
deforestation in Indonesia.
 Child Labor issues: According to Amnesty International in 2016
Unilever palm oil provider Wilmar International profited from 8 to 14
year old child labor and forced labor. Some workers were threatened or
not paid for work. Some workers suffered severe injuries from toxic
chemical. In 2016 Singapore-based Wilmar International was world’s
biggest palm oil grower.
 Sustainability: Speaking of sustainability, Unilever has set itself a
tough challenge. The company wants to double the size of business
while reducing the environmental impact. The risk here is growing
the business. But growing the business and generating profit at the
same time is more or less of a challenge.
 Supply chain risk: Unilever is a global business with global supply
chains. It is designed to enable the company to secure alternative
material supplies on short notice. The crack in the supply chain
plans can intervene directly or have the risk of negatively affecting a
Unilever product.
  Advertising of USLP: Marketing is at the forefront of Unilever’s
sustainability agenda. However, Unilever has not yet to found an
effective way to communicate environmental messages to a mass
consumer audience yet. Consumers are “still a long way off” from
purchase decisions being motivated on the environment alone.
 Emerging Market Sales decline: Emerging markets account for
more than half of Unilever’s sales. But competition with the local
producers is very high in these markets. And consumers sometimes
prefer local product rather than a new one. The competition faced
by Unilever is huge in this area.
Because of government interventions, remittances from rural migrants,
and works of NGOs and social organizations in developing better farming
and sustainable living skills, the rural markets present a huge, global
opportunity. Accelerated penetration of mobile phones, internet, and
satellite TV is making these rural consumers aware of the product and
service options that they aspire to have for themselves and their families.
Urban markets are becoming saturated – competition there is growing
ever-more fierce. Forward-looking companies like Unilever cultivate an
inclusive growth strategy that considers rural consumers as part of their
plans for growth. Unilever need to adjust its strategy and policy
continuously to face these problems and challenges.
 Recommendation for Future
Based on the research and findings behind this assignment, there were some
problems and challenges noticeable. After carefully thinking and analyzing
these problems, we came up with some recommendations for future strategic
changes in Unilever –
 Better align business processes with said policy. Some suppliers and
regional partners are still a little vague about some policies.
 Apply changes specific to the operations in a particular country. Rather
than using a general one, Unilever should improvise country-specific
strategies.
 Being a global company it needs to operate according to local
preferences. Some products still need “local touch” for the consumers in
that area.
 Continuously improve the strategy to maintain its level over the local
competitors.
 High concentration on Emerging markets. Because emerging markets
have huge potential.
 Ensuring that Unilever meets the same standards expected from its
suppliers.
 Needs to launch more advertising campaign to promote Unilever
Sustainable Living Plan (USLP) to the consumers.
 Improving the products according to the USLP strategy.
 Conclusion
Unilever, a leading multinational corporation, has multifarious brands that
inherent consumer products on a large scale and involve in manufacturing
gigantic operating in hundred countries all over the world. Unilever's has
been moved by the significant circumstances of the day like economic boom,
rapid change in technology, depression, people's lifestyle, and recession.

Today Unilever is one of the popular companies all-over the world with their
best quality of products. They always focus on customer satisfaction and want
to give their products best position in the market. They are also continuously
analyzing the market share, PLC stage, segmentation level, target people and
market position.
They have “research team” who work on product line, mix, branding, and
packing in marketing strategy. For remaining target people they are showing
lots of advertising and with this they will achieve higher position in the world,
even higher than what they now hold.

Unilever is one of the oldest multinational companies in the world and a

pioneer in FMCG industry. Unilever is now operating and selling in almost 200
countries in the world. It is the world's largest consumer goods company
measured by 2012 revenue, and is also the world's largest producer of food
spreads. It is Europe’s seventh most valuable company. And the launch of the
revolutionary strategy USLP has given Unilever a massive advantage over its
competitors.

Unilever is not just selling goods now; it’s promoting social issues,
campaigning various ideas, arranging regional business competitions, and
above all trying to create a sustainable future by using agro-based materials
and non-polluting methods. Continuous improvement and innovation will
help Unilever stay strong for another century.