Introduction to Unilever

No matter who you are, or where in the world you are, the chances are that
our products are a familiar part of your daily routine. Every day, around the
world, people reach for Unilever products.
Unilever today
No matter who you are, or where in the world you are, the chances are that
our products are a familiar part of your daily routine.
Every day, around the world, people reach for Unilever products. Our brands
are trusted everywhere and, by listening to the people who buy them, we've
grown into one of the world's most successful consumer goods companies. In
fact, 150 million times a day, someone somewhere chooses a Unilever
product.
All around you
Look in your fridge, or on the bathroom shelf, and youre bound to see one of
our well-known brands. We create, market and distribute the products that
people choose to feed their families and keep themselves and their homes
clean and fresh.
People's lives are changing fast. As the way we all live and work evolves, our
needs and tastes change too. At Unilever we aim to help people in their daily
lives. So we keep developing new products, improving tried and tested
brands and promoting better, more efficient ways of working.
Focusing on performance and productivity, we encourage our people to
develop new ideas and put fresh approaches into practice. Hand in hand with
this is a strong sense of responsibility to the communities we serve. We don't
only measure success in financial terms; how we achieve results is important

too. We work hard to conduct our business with integrity respecting our
employees, our consumers and the environment around us.

Highlights
Unilever is one of the world's leading suppliers of fast-moving consumer
goods. Here are some recent highlights from our three global divisions Foods, home care and personal care.
Foods

The acquisition of Bestfoods in 2000 brought us leadership in the

culinary category. Knorr is now our biggest Food brand, with a product range
covering soups, bouillons, sauces, noodles and complete meals.

We have met consumer demand for healthy foods by launching

Flora Pro.activ, a spread which contains ingredients that can help reduce
cholesterol levels.

In the branded olive oil category we are a leader, the most important
brand being Bertolli. Appealing to consumers' taste for Mediterranean food,
we have launched Bertolli pasta sauces and dressings.

We are the world's leading ice cream producer, with brands such as
Wall's and Ben & Jerry's. Innovations such as Magnum snack-sizes and
Cornetto miniature and multi-packs have sparked progress.

We are the largest seller of packet tea in the world through our Lipton
and Brooke Bond brands.
Home & personal care

We lead the home care market in much of the world, which includes
cleansing and hygiene products.

Many of our home care products are market leaders including Cif,
Comfort, Domestos and Persil.

Within the personal care market, we are global leaders in products for
skin cleansing, deodorants and antiperspirants

Our history
Unilever's corporate vision helping people to look good, feel good and get more out of life
shows how clearly the business understands 21st century-consumers and their lives. But the spirit
of this mission forms a thread that runs throughout our history.
Helping people get more out of life
In the 1890s, William Hesketh Lever, founder of Lever Bros, wrote down his ideas for Sunlight
Soap his revolutionary new product that helped popularise cleanliness and hygiene in Victorian
England. It was 'to 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'.
This was long before the phrase 'Corporate Mission' had been invented, but these ideas have
stayed at the heart of our business. Even if their language and the notion of only women doing
housework has become outdated.
In a history that now crosses three centuries, Unilever's success has been influenced by the major
events of the day economic boom, depression, world wars, changing consumer lifestyles and

advances in technology. And throughout we've created products that help people get more out of
life cutting the time spent on household chores, improving nutrition, enabling people to enjoy
food and take care of their homes, their clothes and themselves.
Balancing profit with responsible corporate behaviour
In the late 19th century the businesses that would later become Unilever were among the most
philanthropic of their time. They set up projects to improve the lot of their workers and created
products with a positive social impact, making hygiene and personal care commonplace and
improving nutrition through adding vitamins to foods that were already daily staples.
Today, Unilever still believes that success means acting with 'the highest standards of corporate
behaviour towards our employees, consumers and the societies and world in which we live'.
Over the years we've launched or participated in an ever-growing range of initiatives to source
sustainable supplies of raw materials, protect environments, support local communities and much
more.
Through this timeline you'll see how our brand portfolio has evolved. At the beginning of the
21st century, our Path to Growth strategy focused us on global high-potential brands and our
Vitality mission has taken us into a new phase of development. More than ever, our brands are
helping people 'feel good, look good and get more out of life' a sentiment close to Lord
Leverhulme's heart over a hundred years ago.
Building on this heritage, our priorities now are inspiring people to take small everyday actions
that can add up to a big difference for the world from laundry brands that help minimise wasted
water and packaging to nutritious, easily prepared and affordable meals and snacks.
Timeline

19th

Although Unilever wasn't formed until 1930, the

centur

companies that joined forces to create the business we

know today were already well established before the start

of the 20th century.

1900s

Unilever's founding companies produced products made of

oils and fats, principally soap and margarine. At the
beginning of the 20th century their expansion nearly
outstrips the supply of raw materials.

1910s

Tough economic conditions and the First World War make

trading difficult for everyone, so many businesses form
trade associations to protect their shared interests.

1920s

With businesses expanding fast, companies set up

negotiations intending to stop others producing the same
types of products. But instead they agree to merge - and so
Unilever is created.

1930s

Unilever's first decade is no easy ride: it starts with the

Great Depression and ends with the Second World War.
But while the business rationalises operations, it also
continues to diversify.

1940s

Unilever's operations around the world begin to fragment,

but the business continues to expand further into the foods
market

and

increase

investment

in

research

and

development.

1950s

Business booms as new technology and the European

Economic Community lead to rising standards of living in

the West, while new markets open up in emerging

economies around the globe.

1960s

As the world economy expands, so does Unilever and it

sets about developing new products, entering new markets
and running a highly ambitious acquisition programme.

1970s

Hard economic conditions and high inflation make the 70s

a tough time for everyone, but things are particularly
difficult in the fast-moving consumer goods (FMCG)
sector as the big retailers start to flex their muscles.

1980s

Unilever is now one of the world's biggest companies, but

takes the decision to focus its portfolio, and rationalise its
businesses to focus on core products and brands.

1990s

The business expands into Central and Eastern Europe and

further sharpens its focus on fewer product categories,
leading to the sale or withdrawal of two-thirds of its
brands.

The

The decade starts with the launch of Path to Growth, a

21st

five-year strategic plan, and in 2004 further sharpens its

centur

focus on the needs of 21st century consumers with its

Vitality mission. In 2009, Unilever announces its new

corporate vision working to create a better future every
day with brands that help people look good, feel good and

get more out of life.

Unilevers Global Strategy

As one of the strong and healthy companies in the world with many successful brands, Unilever
has an opportunity to expand into foreign markets that it is not yet operating in, in order to gain
access to customers around the world. Supported by strengths of its four key global brands
Dove, Sunsilk, Rexona and Lux, 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
strategy using essentially the same competitive strategy approach in all country markets where
the company has a presence (with only minimal responsive to local conditions), sells much the
same products everywhere (make minor adaption to local countries where needed to
accommodate local countries preferences), strives to build global brands, and coordinates its
actions worldwide (centralized).

A global strategy used by the Unilever is preferable to localized strategies because

Unilever can more unify its operations and focus on establishing a brand image and reputation
that is uniform from country to country. It strategy implies to the Unilever success in building
strong character brand such as Dove, Sunsilk, Rexona and Lux. Moreover, with a global strategy
Unilever should coordinated its marketing, operational and distribution worldwide.

Unilever is increasing its efforts to build on its long-established local roots in developing
regions. Through its well-established distribution network in both the traditional and modern
retail outlets and with a good ability to adapt successful global brand concepts to suit local
markets, Unilever is in a good position to be able to capitalize on the growth forecast in these
regions.

Once Unilever became one of the most successful global companies in the world, it has
many profit sanctuaries. By having multiple profit sanctuaries, Unilever has strong competitive
advantage over its competitor with a single or few sanctuaries.

In the cosmetics and toiletries globally competitive industry, there are no doubt that
Unilevers major rivals over the next few years will be Procter & Gamble and LOral, both of
which give significant resources to new product development activity, and respond to changes in
the market faster than Unilever. LOral also has the benefit of being exclusively involved in

cosmetics and toiletries, unlike both Unilever and Procter & Gamble which both have crossindustry involvement, such as in packaged food. Much the same group of rival companies
competes in many different countries. Therefore, the competition pursues the company to be
more innovative in developing its products and maintaining its brands. The following diagram
shows the market performance of Unilevers skin care and hair care market share:

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. Finally in entering
the emerging-country market Unilever prepare to compete on the basis of low prices. Unilever
pursued this strategy because 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.

All strategies executed by Unilever for competing in foreign market resulting in moderate
5% sales growth in 2006 just above market performance ensured that Unilever kept its
position as third largest player in cosmetics and toiletries with a 7% market share. Second-placed

LOral fared a lot better, increasing the gap between the two companies in part thanks to its
acquisition of The Body Shop. Market leader Procter & Gamble remained over five percentage
points ahead of Unilevers share. In 2006, Unilever remained comfortably ahead of ColgatePalmolive in fourth place. Unilever decision to introduce its product on emerging market such as
Asia-Pacific, Latin America and North America implies to the high contribution of Unilever total
revenue by 26%, 21% and 16% respectively.

On January 1st, 2013 Unilever released its results for the fourth quarter and full year 2012
which show good quality, profitable growth ahead of our markets. This underscores the good
progress we are making in transforming Unilever into to a sustainable growth company. The past
year performance of the company was as follows:
v Turnover increased by 10.5% to 51.3 billion with a positive impact from foreign exchange of
2.2% and acquisitions net of disposals of 1.1%
v Underlying sales growth 6.9% comprising volume growth of 3.4% and price growth of 3.3%
v Emerging markets underlying sales growth 11.4% now representing 55% of turnover
v Core operating margin up 30bps to 13.8%; gross margin up 10bps, advertising and promotions up
470 million at constant exchange rates
v Core earnings per share increased by 11% to 1.57; free cash flow of 4.3 billion

ANALYSIS
Before analyzing the Unilever strategies for competing in foreign market, its important
to identify companys resource strengths and weaknesses and its external opportunities and
threats, commonly known as SWOT analysis. This analysis provides a good overview of whether
the companys overall situation is fundamentally healthy or unhealthy. Therefore, for a
companys 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

SWOT Analysis of Unilever Cosmetics and Toiletries

Based on the SWOT analysis we can infer that the company has very healthy and strong
condition in overall. Therefore, this condition provides high capabilities to the company and
offers wide opportunities for the company to compete in foreign market. Based on this analysis,

Unilever firstly entered foreign market in the year of 1950 by offering its product to European
community.
From the Unilever mission statement, we can conclude that the company expands into foreign
markets in order to gain access to customers around the world. Unilever recognized that its
product is commonly used for all people worldwide. The companys objective to bring their
wealth of knowledge and international expertise to the service of local consumer pursues the
company to produce many nutrition, hygiene and personal care product with successful brands.
Therefore, Unilever are moving rapidly and aggressively to extend their market reach into all
corners of the world.
For its cosmetics and toiletries product, Unilever start to compete internationally by entering just
one or select few foreign markets. Unilever launched Axe/Lynx/Ego deodorant body spray in the
US and Canada in autumn 2002 and introduced Dove initially in Italy, France and Belgium in
2002. Once successfully introduced its product in several market, Unilever expands its successful
brand to many other markets and starting to compete globally.
Through its successful growth strategy, Unilever has continued to build on the strengths of its
four key global brandsDove, Sunsilk, Rexona and Luxand by doing so, created strong
platforms for further growth in a number of cosmetics and toiletries sectors. This has been
particularly evident in deodorants, mens grooming products and bath and shower products, with
strong growth for the Axe, Dove and Rexona brands. However, competition in the cosmetics and
toiletries industry remains tough, and while the current strategy is providing results, greater
product innovation and marketing support, as well as further development of functionality in
products will be needed to keep up with the market. There are no doubt that Unilevers major
rivals over the next few years will be Procter & Gamble and LOral, both of which give
significant resources to new product development activity, and respond to changes in the market
faster than Unilever. LOral also has the benefit of being exclusively involved in cosmetics and
toiletries, unlike both Unilever and Procter & Gamble which both have cross-industry
involvement, such as in packaged food.
In a globally competitive industry faced by Unilever, much the same group of rival
companies such as Procter & Gamble and LOral competes in many different countries, but
especially so in countries where sales volumes are large and where having a competitive

presence is strategically important to building a strong global position in the industry. Therefore,
a companys competitive position in one country both affects and is affected by its position in
other countries. In this case innovation plays an important role. Thus, in a market where
innovation is often the key to growth, Unilever has invested in improving its research and
developing procedure further including speeding up the process of getting new products to
market. Through a mass-market positioning, much of the companys organic growth strategy is
to leverage the value of key brands by cross-sectoral brand extensions, thus taking advantage of
customer brand recognition and loyalty, and creating marketing efficiencies. The Dove brand is
one of the examples of a recognized soap brand being successfully extended into skin and hair
care, deodorants, baby care and mens grooming products.
Unilevers marketing strategy for competing in foreign market
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 companys 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,
which retails at a price equivalent to just EUR0.20 and is distributed in India and Indonesia.

The company also has more directly brand-related programs, including Close-Ups Project Smile
in Nigeria, which used small kiosk outlets to showcase both its products and oral hygiene
information, and the Dove Self-Esteem Fund, which has joined with organizations such as the
Girl Scouts of the USA and the UKs Eating Disorder Association to fund educational Body Talk
programs in schools to improve body-related self-esteem.
Less directly, a Brazilian recycling partnership with Pao de Acucar, a major Brazilian
retailer, not only helped employ more than 300 people in a local recycling co-operative, but also
gave Unilevers products greater in-store prominence as well as raising the profile of brands
including Rexona by having their logos on point-of-sale information and educational materials.
The companys successful brand innovation program is supported with a high level of marketing
and advertising activities including most media. As there are many opportunities in the foreign

markets but the tendency of threats is also same as opportunities. The powerful R&D, diversified
and differentiated product line and market analysis are all important factors that make a company
enjoy its potential and good market share in foreign market.