Marketing Mix of Unilever
Apart from its large array of brands and products, Unilever enjoys global popularity because of innovation. Continuously for the past eight years, the brand has performed consistently and has enjoyed fast growth during the past two years especially. At least 60% of its brands have seen rise in market share during these two years. Still, there is immense pressure because of the FMCG landscape having grown highly competitive. 13 of its brands have sales of €1 billion or more. Apart from these things economies of scale have allowed the brand to operate at low costs and efficiently.
Several of the 400 brands produced by Unilever are household names in the various corners of the world. Like the other FMCG brands, Unilever also faces the challenges created by economic volatility. The brand has some critical manufacturing and supply chain strengths that also enable performance. Globally, its products sell in more than 190 countries. This is a discussion of its marketing mix analyzing the four P’s Product, place, price and promotion. Read on..
The product mix of Unilever is a vast array of brands and products. It makes 400 brands and several of them enjoy very high level of popularity and brand loyalty. Of these 400 brands, at least 13 have sales of 1 Billion Euros or more. Below is a list of the 13 celebrity billion Euro brands in the product mix of Unilever.
- Axe Dirt is Good (e.g. Omo) 3. Dove 4. Family Goodness (e.g. Rama) 5. Heartbrand (e.g. Wall’s) 6. Hellmann’s 7. Knorr 8. Lipton 9. Lux 10. Magnum 11. Rexona 12. Sunsilk 13. Surf
The Unilever brand is organized into four chief product categories. They are personal care, foods, home care and refreshment. Personal care is the largest category followed by foods, homecare and refreshment. Many of these brands have become household names. However, Unilever constantly assesses its portfolio to ensure that it has the right balance in its product mix. The brands that no longer fit with its strategy are disposed off immediately. 12 of its sustainable living brands showed 30% faster growth than the rest of the business in 2015 and again 490% faster in 2016 and delivered half of the growth nearly for Unilever. These 12 brands are Knorr, Dove, Dirt is Good e.g. Omo, Lipton, Hellmann’s, Smile e.g. Signal/Pepsodent, Lifebuoy, Ben & Jerry’s, Radiant, Breyers, Heart Health and Domestos.
Unilever is using both the traditional and modern systems for distribution and sales. The proliferation of the direct to consumer models had led to fast fragmentation of the traditional models. It has a well established urban distribution system. However, in the urban areas the big box retailers and the within market distributors have been replaced by the new internet based business models like Amazon. However, Unilever has started leveraging these models and Information technology for sales and marketing. It has deepened its reach into the rural markets of the emerging economies like India. Through a special project called Project Shakti, Unilever has answered the challenges that come in the way of rural expansion. In the urban areas, it is using a mix of traditional and modern channels like retail stores and online shopping sites. In the Indian urban areas it has used technology to design an efficient rural supply chain. The company is spending more to accelerate the digital transformation meaning higher sales and marketing through the digital channels.
The FMCG landscape has grown highly competitive and in this competitive market, it is impertinent that the brands use the right pricing strategy to remain competitive. Apart from its premium products, Unilever maintains competitive prices on the best products. Its pricing strategy is mainly competition oriented and it also offers discounts from time to time to push sales. On its premium products the brand uses slightly higher prices than competitors to maintain quality and the premium image of the products.
Unilever uses both traditional and digital media for the promotion of its brand. It has used the television and print media for the promotion of its brand. From time to time, it has kept running promotional campaigns aimed at building brand recognition. Dove’s Self Esteem Project is aimed at helping the next gen women to realize their potential. In India it unveiled a new campaign last year called “Lets break the rules of beauty”.
Axe also announced a bold new direction with its find your magic campaign for men. This campaign took a multi channel approach led by the digital channels. In the past few years around a quarter of its advertising expense goes to the digital. This spending is even higher in the digitally advanced markets like US or China. However, Unilever has always been one of the top spenders on advertising and has used the power of marketing to build brand recognition and push sales.