Unilever’s Quest by Shedding Brands
Product Portfolio Management
Unilever is a multinational consumer goods giant that produces and distributes personal care products such as shampoos and beauty soaps, home care products such as washing powder, foods, and beverages such as tea and ice cream. The company has over 400 brands all over the world. Some of the best known are Lipton tea, Blue Band, Flora, Heart brand, Hellmann’s, Knorr, Omo, Dove, Axe/Lynx and Rexona.
Unilever product portfolio is designed to meet every need in the household at the highest level of satisfaction possible. From the time an individual wakes up to the time they retire for the day, chances are they will have used a Unilever product. Unilever’s products are available worldwide, as a multinational, this is made possible by a diversified distribution system which enables the company to have a strong presence is the global market. This is because Unilever products are known for their high quality and strong relevance to its consumers’ daily lives. Some of its brands have lasted since its inception in 1930 making it part of the tradition of many households worldwide.
The main competition that Unilever faces in local markets is from Henkel, PepsiCo, Reckitt Benckiser, Beiersdorf, DANONE, ConAgra, and Johnson & Son. Globally, the company faces stiff competition from Procter & Gamble and Nestle. P & G, a multinational, manufactures a wide range of consumer goods while Nestles is the world’s largest seller of nutritional, health and wellness products. P & G is a force in beauty and hygiene products for both men and women such as shampoos, makeup, sanitary products, and deodorants. It also produces diapers for babies and household cleaning products such as Ariel. Nestle produces and sells Nespresso, Nesquik, Kitkat, Maggi, Vittel, and Smarties. Nestle gives competition to Unilever in the ice cream market, beverages, soups, and seasoning. Unilever competes with P & G on a larger scale because they both have a wide range of personal care products. These two competitors have however done better than Unilever in annual sales making them very strong to the market share of Unilever.
Unilever’s products target the entire household. The products are designed to meet personal care needs and household cleaning needs. Personal care products such as Lynx/Axe have been marketed as making young males of 21 years and above attract women better than their peers. The products in Unilever’s portfolio are designed to be the first choice for the clients because of their quality, availability and appeal to their lives.
All the three companies produce products targeted at the upper segment of the market globally. Due to the heavy budget these companies spend in product development and advertising their products are usually slightly more expensive than smaller competitors. However, they have the additional advantage of a strong brand name and image, which still makes them very competitive and profitable. The market is also shifting towards green products with less chemicals and more natural active ingredients. This is all in line with increased global shift towards for healthy living.
In line with this shift towards healthy living, Unilever should come up with a range of nature based home and personal care products. Research has shown that people are willing to pay more for healthy products, which are also environmentally friendly. The target market will therefore be middle to upper class. Natural products are now very popular because of the perceived health effects posed by long-term use of chemical based products. This product will provide a wide range of natural solutions to both home care and personal care needs. The success rate is very high because there is a trend toward healthy living. The riskiest part of the business is finding a sustainable source of the raw materials to produce the products especially on a global basis.
A possible product to start with would be Aloe Vera skin care products. Aloe Vera is a natural plan that has numerous skin soothing qualities. A range of beauty products such as lotions, soaps, and balms can be created. These will fit very well with the other range of personal care products since they will provide a line of natural cleaning products, which a client can rely on from the shower to skin care. Clients are looking for natural skincare products devoid of chemicals, which might cause them other skin conditions.
The company will need to invest in product research and design to come up with the highest quality natural line of products. The company will then have to find a factory that is in a region with aloe Vera or acquire an existing company with a similar product and develop its product or rebrand it. The main competitors may be local small-scale therapeutic vendors. These products will be the first line of internationally recognized natural products with a guarantee on quality and performance. If this concept is developed properly, it could open doors for other products to be developed into natural, healthier options, which the market would be more than willing to adopt.