Unilever's European ice cream market

Résumé du document

Unilever was established in 1930 by the merger of British soapmaker Lever Brothers and Dutch margarine producer Margarine Unie. Unilever has more than 179,000 employess in and around 100 countries worldwide and have 317 manufacturing sites in the world. In 2007, Unilever's turnover was a whopping €40 billion.

Unilever is the global market leader in all the food categories in which it operates: Savory and Dressings, Spreads, Weight Management, Tea, and Ice Cream. Unilever is also a leading brand in Skincare and Deodorants, and it has maintained a very strong position in other Home and Personal Care categories. We can classify Unilever's brand in two categories which are foods and personal and home care.


In the 80s, Unilever was one of the world's biggest companies, but took the decision to focus its portfolio, and soon rationalized its businesses to concentrate on core products and brands. In 1999, Unilever had a portfolio of more or less 1600 brands. But the company notes that a very few number of brands earned all its profits.

Unilever launched a strategy of Path to Growth, a five-year strategic plan. In 2004 Unilever further sharpened its focus on the needs of 21st century consumers with its Vitality mission. According to Unilever “More than ever, our brands are helping people feel good, look good and get more out of life”.

This paper deals with the analysis of Unilever's marketing policy integrating both an empirical and theoretical approach. External Analysis examines opportunities and threats that exist in the environment which is competition from other brands such as Procter & Gamble, Nestle, Kraft Foods, Mars Incorporated, and Reckitt Benckiser.

The Internal Analysis of strengths and weaknesses mainly focus on internal factors that give Unilever certain advantages and disadvantages in meeting the needs of its target market.

Extraits

[...] Now, we can see, for example, Häagen-Dazs as a main competitor in the out- of-home sector. Part III : Strategic options For Unilever there are different strategies of brand in the home” (product which are suppose to be eaten at home: 33% of the market) and in the of home” (ice creams that are bought for immediate consumption and mainly eaten outdoors: 67% of the market): In home sector: - Option Conserve the actual strategy with lot brands: multi- brands strategy. But it's a very expansive strategy in marketing and development. [...]

[...] Unilever's ice cream brand portfolio required multiple marketing development departments in various countries. That's why it's a better strategy to have endorsed brand strategy. Moreover it's very easy for consumers to identified endorsed brand. For the out-of-home sector: a high positioning with Ben Jerry's. Ben & Jerry's produces a wide variety of super premium ice cream, ice cream novelties, low fat ice cream, low fat yogurt and sorbet, using Vermont dairy products and high quality, all natural ingredients. Ben & Jerry's products are distributed nationwide and in selected foreign countries in supermarkets, grocery stores, convenience stores, franchise Ben & Jerry's scoop shops, restaurants and other venues. [...]

[...] It was developed in the early 70s by the Boston Consulting Group. The BCG Matrix can be used to determine what priorities should be given in the product portfolio of a business unit. To ensure long-term value creation, a company should have a portfolio of products that contains both high- growth products in need of cash inputs and low-growth products that generate a lot of cash. The Boston Consulting Group Matrix has 2 dimensions: market share and market growth. The basic idea behind it is: if a product has a bigger market share, or if the product's market grows faster, it is better for the company.” Source: http://www.12manage.com/methods_bcgmatrix.html There are four big segments in the BCG Matrix. [...]

[...] The first important force in the ice cream market is the arrival of news entrants. In fact, profitable markets that yield high returns will attract firms unless there are significant barriers to entry. The results are many new entrants, which will effectively decrease profitability. Unless the entry of new firms can be blocked by incumbents, the profit rate will fall towards a competitive level. In the ice cream market, news entrants have recently become a very important competitive force The second important force is the power of retailers. [...]

[...] Stars are frequently roughly in balance on net cash flow. However, if needed any attempts should be made to hold your market share in Stars, because the rewards will be Cash Cows if market share is kept. BCG model is helpful for managers to evaluate balance in the firm's current portfolio of Stars, Cash Cows, Question Marks and Dogs. The BCG method is applicable to large companies as Unilever that seek volume and experience effects. It provides a base for management to decide and prepare for future action. [...]