Touching people’s lives Unilever

TOUCHING PEOPLE’S LIVES

Unilever is a global market leader in health, hygiene and beauty products, as well as in other FMCG sectors. The company’s recent acquisition of the Sara Lee Corporation enhances and extends its portfolio in the personal care segment and in particular the bath and laundry market. Philip Yorke takes a closer look at the Unilever success story and why this latest acquisition is good for both the company and the consumer.

At the end of 2010 Unilever were given the green light by the EU Competition Authorities Commission to proceed with the purchase of the personal care division of the Sara Lee Corporation. The deal was worth €1.2 billion in cash. The brands involved generated sales of more than €750 million in 2009. The addition of such well known brands as Radox, Duschdas and Neutral brings market-leading bath products into the already diverse portfolio of Unilever’s personal care products. These brands now will sit comfortably alongside other Unilever iconic brands such as Dove, Impulse, Lux, Sunsilk, Sure and Timotei.

Improving the value chain

Unilever is a true global giant with almost 200,000 employees worldwide and in the UK alone records sales of more than €2.4 billion. The volume of products sold every day in the UK market is staggering. For example, 35 million cups of PG Tips tea are consumed and over 1 million tubs of Flora are produced every day. In addition, one billion Wall’s ice creams are eaten every year and four Pot Noodles are sold every second. Unilever’s Personal Care products are produced and consumed on a similar scale.

So why did Unilever want to add the Sara Lee brands to its already highly successful list of brand leaders in the Personal Care sector? Doug Bailie, Unilever’s president of Western Europe, summed it up like this, “We are pleased to have received the green light from the European Commission for this deal and look forward to adding important brands to our business. Home and Personal Care is a key growth area and we are acquiring a number of leading brands that fill gaps in our portfolio, improve the shape of our overall European portfolio, while offering significant potential for development in other geographies”

The company also said that the acquisition of these market-winning brands complements Unilever’s existing categoryleading portfolio of global brands such as Axe, Dove and Rexona. With this extended range, the business can cover a wider spectrum of price points and better meet the demands of more consumers in more markets. As a result, Unilever expects to be able to stimulate further growth in an intensely competitive market.

In addition to Radox, Duschdas and Neutral, the deal includes local category leaders such as Biotex in Laundry, Zwitsal and Fissan in Baby Care and Prodent and Zendium in Oral Care. The company says that together these brands will enhance its category mix and deliver breadth and depth to an already successful product portfolio.

Value-added sustainability

Unilever devotes close to one €1 billion to research and product development every year. A significant proportion of this goes into improving the sustainability of its products and reducing its environmental footprint. This is another valid reason why the Sarah Lee Corporation deal is good news for the consumer. Not only will the products become purer in content, but the manufacturing will embrace new technology to reduce their environmental impact. To underscore this, in November 2010 the company launched the ‘Unilever Sustainable Living Plan’ in which the company commits to three positive outcomes by the year 2020: To halve the environmental footprint of the making and use of its products; to help more than a billion people take action to improve health and wellbeing; and to source 100 per cent of its agricultural raw materials sustainably. These core values underpin Unilever’s approach to sustainability and its overriding culture of consumer care.

When it comes to health, hygiene and beauty, Unilever aims to help people to

feel good, look good and get more out of life. At the heart of this mission is hygiene – and health through hygiene. The desire to be clean, active, healthy and energetic is common to everyone. However to billions of people in the developing world, health is simply a matter of the absence of illness.”Without good hygiene, consumers are vulnerable to a wide range of infectious diseases that not only have the potential to severely undermine the quality of their lives, but even to end their lives prematurely” says Steve Miles, Unilever’s Global Vice President Health Brands.

Today Unilever is helping to set improved hygiene standards in the emerging nations through education and practical support. For example, by providing educational grants, such as the one for the International Scientific Forum on Home Hygiene, as well as practical suggestions for local communities, which can be as simple as recommending that a gel might be more appropriate than a bar of soap in regions where there is little running water available. The future now looks greener and healthier for Unilever’s consumers and the world at large n