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1. Unilever

Published August 6, 2012
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1. Unilever

United Kingdom

Sales: $32.9 billion

Key Personnel: Paul Polman, chief executive officer; Doug Baillie, chief human resources officer; Geneviéve Berger, chief research and development officer; Jean-Marc Huët, chief financial officer; Alan Jope, North Asia; Kees Kruythoff, North America; Dave Lewis, personal care; Harish Manwani, chief operating officer; Pier Luigi Sigismondi, chief supply chain officer; Keith Weed, chief marketing and communication officer; Jan Zijderveld, Europe.

Major Products: Personal Care—Axe/Lynx, Dove, Lifebuoy, Pond’s, Rexona, Signal, Close-Up, Sunsilk, Lux, Vaseline, Tigi. Household Care—Persil/Omo, Cif, Comfort, Domestos, Sunlight, Omo, Radiant, Surf, Snuggle.

New Products: Personal Care—Alberto-Culver (acquisition), Concern Kalina (acquisition), Dove Men + Care, Axe Excite.

Comments: Corporate sales rose 5% to $61.9 billion and net income was up 1% to $6.4 billion last year. During 2011, Unilever completed the acquisition of Alberto-Culver and benefitted from the full year results of Sara Lee’s personal care business, which was purchased in December 2010.

Last year, sales in emerging markets rose 11.5%, led by double-digit gains in India, China, Turkey and South Africa. In fact, emerging markets now account for 54% of Unilever’s sales. In the developed world, sales rose just 0.8%. The US, Germany, UK and France accounted for 61% of Unilever’s developed world business. Sales growth in these countries ranged from 1-4%.

More specifically, sales in Asia, Africa and Central & Eastern Europe (41% of sales), rose 10.5% to $26.3 billion and volume increased 4.5%. Sales in the Americas (33% of sales) rose 6.3% to $21.3 billion on a volume gain of 0.4%. Sales in Western Europe (26% of sales) rose less than 1% to $17.1 billion, but volume declined 1.2%.

Last year, personal care (33% of corporate sales) overtook food (30%) as the biggest category within Unilever. Refreshment accounted for 19% of sales and home care, 18%.

Sales of personal care products rose 8.2% to $21.5 billion. Volume increased 4.2%. Dove became Unilever’s first €3 billion brand. The company credited strong gains in North America, where hair care and deodorants performed well, and in China, where skin cleansing and hair care posted strong gains.
Household product sales increased 8.1% to $11.4 billion. Volume increased 2.2%. Sales of laundry products were strong in China, India, South Africa and Western Europe.

Unilever’s been a dominant force in emerging markets for decades, proudly noting that it has more than 50 years of experience in China, India and Indonesia. Now, with P&G brass insisting that their emphasis is on building share in established countries, Unilever may seize the chance to solidify its position in India and elsewhere. Last month, the company said it plans to diversify its personal care product portfolio in India across categories and price points through brand extensions of its popular Lux and Axe brands. Unilever will build a plant to produce deodorants in India, which will also cater to export demand. Unilever currently imports a large portion of deodorants as aerosols. The new manufacturing plant will thus provide Unilever a huge cost advantage, according to observers.

Dove is a megabrand, but Unilever acquired US rights to Simple (left).
For the first quarter of 2012, sales rose 8.4% to $15.8 billion. Personal care sales rose 10.4% to nearly $5.6 billion driven by the success of Dove Nutrium Moisture shower gels and the rollout of Dove Men+Care. Sales of Lifebuoy rose, helped by the “10 seconds germ-kill” campaign and the introduction of Lifebuoy Clini-Care10 in India. Radox performed well in the UK, helped by the success of the men’s range. The launch of Simple in the US and a strong performance from Fair & Lovely helped drive growth in face care, although Pond’s had a slow start to the year as Unilever transitioned to the new Age Miracle and Flawless White ranges. Vaseline sales were up, helped by the continued rollout of Essential Moisture hand and body range which is now in 14 markets.

Hair care benefited from the rollout of Unilever brands into new markets and strong innovation performance. Tresemmé growth is being driven by the success of the launch in Brazil and the new split ends range. Dove Damage Therapy continues to perform well and the premium Style and Care styling range has just been introduced in the US. Clear is growing rapidly across Asia and Latin America, driven by the success of the 2011 relaunch. Axe hair is now being rolled out across Europe with good initial acceptance.

Double-digit gains for Dove helped propel deodorant sales. The category should get another boost from the rollout of Rexona Maximum Protection to new markets. Oral growth was driven by market development activities and trading up through premium innovations, such as the recent introduction of Signal Sensitive Expert in France. The recent oral launches into new markets including Pakistan, Sri Lanka and Thailand, are progressing well.

Home care sales rose 10% to nearly $2.9 billion. Robust laundry growth reflects Unilever’s ongoing focus on improving the quality of its products, impactful advertising and sustained delivery from key innovations, such as Omo with built-in pre-treaters, according to the company. White space launches also contributed with successful launches of Comfort fabric conditioners in Australia, New Zealand, South Africa and the Philippines.

Household cleaners benefited from the rapid growth of Sunlight hand dishwash products in South Asia and South East Asia, the success of the Domestos Toilet System range and the introductions of Domestos in Argentina, Pakistan and Sri Lanka and Cif in China.Dove is a megabrand, but Unilever acquired US rights to Simple.

In the US, Unilever acquired the rights to the Simple brand of personal care products.


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