Unilever Plc: A Global Consumer Goods Organization

Company Overview

Unilever Plc. is an Anglo-Dutch transnational consumer goods organization. The organization is co-headquartered both in Netherland and in United Kingdom. Unilever has wide and large ranges of product portfolio, which offers the products in various categories like food, beverages, personal care, home care, cleaning agents and many more. The organization has been considered as the largest consumer goods organization in the world, while it is measured in terms of its revenue (Unilever.com 2017). Unilever Plc. is also considered as the largest producer of food spread like margarine. It is one of the oldest multinational companies, whose products are available around 190 countries. Unilever has owned over 400 brands all around the world having turnover of 50 billion Euros (Unilever.com 2017).

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Unilever Plc has its research and development facilities in the countries like United Kingdom, China, Netherlands and India. The success level of the organization is highly dependent on its numerous corporate acquisitions like Lipton, Best Food, Dollar Shave Club, Ben & Jerry’s, Chesebrough-Ponds, Brooke Bond and some others (Tandon and Sethi 2017). Such acquisitions have facilitated the organization in success internationalization of its business in various international markets. As per the statistics of 2016, the total revenue of the organization is €52.713 billion. Moreover, total assets of the organization are worth of €56.429 billion (Unilever.com 2017). The organization is mostly successful in the markets like United Kingdom, USA, India, China, Australia and many others.

Briefly list the market(s) the company is active in: Unilever is an Anglo-Dutch transnational company, which offers various types of consumer goods. It is one of the oldest multinational companies, which operates in more than 190 countries. The most important markets of the organizations are described briefly in the following:

Unilever has established its one of the two co-headquarters in Netherland. Vlaardingen R&D is the research centre of the organization in Netherland. The research centre of Netherland has added extra capabilities to three areas of the organization, which are namely research, product development and implementation. Unilever mostly operates Unilever NV in Netherland, which engages in the production and marketing consumer goods like hygiene products, foods, refreshment, home care, personal care and many others. The organization has owned almost 35% market share in the consumer goods industry of Netherland. Furthermore, Unilever has $143.9 Billion market capitalization in the household and personal care industry of this country (Christodoulides et al. 2015). As per the recent statistics, the sales volume of the organization is $58.31 billion in Netherland. The business-friendly government of the country has also made the success level of Unilever.

Briefly list the market(s) the company is active in

Unilever has become the fourth largest consumer good company in India. The consumers of India contribute almost 9% to the total sales of the organization. India is also an effective research and development region of the organization, which fosters innovation in its product ranges. The product portfolio of Unilever in India has over 35 brands, which are spread in different categories like fabric, ice cream, hair care, skin care, beverages, processed foods and many others. Soaps and detergent brand contributes major chunks of revenue in the organization in Indian market. Moreover, such brands contribute almost 48% of total revenue in Indian market (Pant and Ramachandran 2017). Unlike USA, the personal care and home care products have remained the chunk of Unilever’s business in India. Such products have made 88% of the total revenue of the organization during 2016-2017 in Indian market. However, the organization faces tough competition in Indian market from the companies like P&G, Dabur India, Emami and many more. The organization has gained market share of about 90% after laying out prominent strategy of regional competition (Patil and Sarode 2017). 

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Unilever has strengthened its research and development effort in Shanghai. In the recent year, the Chinese revenues of Unilever have been increased by 15-20%. Moreover, the revenue of Unilever in China has stood in excess of €1 billion out of €44bn globally. Unilever has gained highest proportion of sales in its China Market. Moreover, the organization has gained 35% market share in China Market (Keller et al. 2014). The organization also faces tough competition from the companies like Nongfu Spring, Orion, Dali Group, Heng An and others. Chinese market has great potentiality of for Lipton tea. Chinese consumers are increasingly younger and they have higher inclination towards drinking tea for refreshment either at their office or at their home. The organization has become the market leader in China because of huge sales of the Lipton Tea.

USA is one of the most important markets of Unilever PLC in terms of its global success. The product of Unilever USA reaches almost 2 billion people in the country. Unilever has grabbed huge market share in USA in Ice Cream market. Moreover, the organization has hold 63.1% market share in Ice Cream market over the competitors like Nestle S.A, General Mills and others (Unilever.com 2017). On the other hand, growing urbanization and huge participation of the women in the workforce has increased the demand for household products in the country. It has ultimately increased the sales volume of the organization in this country. Unilever has also increased its market share in USA in the field of deodorant products.

Netherlands

One of the co-headquarters of Unilever is established in United Kingdom.  In UK, Unilever has the largest and most effective research and development team for producing most innovative household and personal care products. Moreover, 80% of the products, which Unilever sells in the market of United Kingdom, are actually produced in this country itself. Unilever has gained almost 45.76% market share in UK market (Moses et al. 2013). However, the organization also faces tough competition in the market of United Kingdom. Moreover, the organization mostly stiff faces competition from the competitors like P&G, Mondelez UK Limited and many others. Moreover, the organization is also facing tough competition from those competitors in terms of price wars. Stiff price competition is limiting the profit level of the organization.

Unilever Australia is mainly engaged in the production and sales of wellbeing and food products in the market of Australia. Apart from that, the organization has acquired Weis ice cream businesses in Australian market (Davis, Chelliah and Minter 2014). The premium and natural ingredients of such ice cream product have increased the consumer demand of Australia for such products.

Their main competitors are At present Unilever plc is facing tough competition from the top 10 listed consumer product manufacturing companies. The main competition is arising from that fact that all the companies are providing similar products with high consumer demand and exclusive value for daily lives. This has resulted in a strong competition among all the companies in the UK market. Moreover, with the progress of time, niche marketing has created more demand of latest products along with presence of substitute items in the market. Eventually, it can be said that the marker competition of the commodity items in UK is growing exponentially in terms of market share and market growth. The top five companies with which Unilever plc is facing tough competition are listed below and brief about the companies which are moderately creating competitive environment are provided respectively.

The organization is a public listed consumer good corporation and products ranging from personal care to cleaning agents. At present P&G has ten small business units which are baby care, fabric care, family care, grooming, feminine care, home care, hair care, personal health care, oral care and skin and personal care. On the other hand, the organization is currently operating in Asia Pacific, Greater China, Europe, India and Middle East, North America and South America (Payaud 2014). Considering resources, P&G is extremely strong in raising capital, creating partnership, assigning vendors and suppliers. Therefore, it is prominent that the organization is imposing direct competitive impact on Unilever Plc.

India

The organization is a public listed consumer packaged goods manufacturing company along with product categories in pharmaceutical and medical categories. At present the organization has more than 250 subsidiary companies. Johnson & Johnson is operating in more than 60 countries with distributers in more than 170 countries. Even though the products of Johnson & Johnson are limited to Pharmaceuticals, medical devices and consumer health, however more than 40% of its products are directly under competition with Unilever Plc (Simms and Trott 2014). On the other hand, with more than US$71 billion revenue, Johnson & Johnson has a strong market share in UK consumer good sector depicting tough competition with Unilever Plc.

The organization is a public listed food manufacturing company and products ranging from baby food to snacks. The organization is considered as the largest food company globally having rank of 33 in Fortune Global 500. The organization is having 7 small business units, which are powdered and liquid beverages, milk products and ice cream, nutrition and health science, prepared dishes and cooking aids, petcare, water and confectionery (Szmigin and Gee 2017). On the other hand, Nestle Plc is operating in regions such as America, Europe, Asia, Africa and Oceania from where It has created huge customer loyalty, market reputation and brand awareness. Therefore, it can be said that Unilever is under direct competitive impact from Nestle just from the diversified product range that it offers along with perceived value, daily need and ready to use items.

The organization is a public listed British multinational consumer goods company and products ranging from antiseptic to detergent. The organization has 4 small business units, which are Cleaning products, Personal care products, Condiments and Consumer healthcare products. Reckitt Benckiser operates in more than 60 countries and distributers in more than 200 companies. The range of products are quite similar with Unilever Plc specifically in-home care and personal care (Chowdhury, Simu and Uddin 2016). This organization can be considered as the direct competitor of Unilever Plc because the entire product base similar. However, the market share of Unilever Plc is more because of its explicit diversified product base.

The organization falls under Societe anonyme type and is operating in food processing industry of UK. The organization has 4 small business units, which are Fresh dairy products, Early life nutrition, water and medical nutrition. Danone is mostly operating with joint venture strategy with most of the developing countries using niche marketing (Trott and Simms 2017). This has resulted in creating new market demand and thereby acting as a direct threat of competition for Unilever Plc. On the other hand, it can be said that the product base of Danone is not quite similar with Unilever Plc and therefore, this organization might be creating more impact in market share in future due to diversification and innovation.

China

Coty, one of the most successful beauty products manufacturer with operations in more than 150 countries is having products in fragrance, cosmetics, skin care and hair care categories. The company have limited product base for only beauty segments and therefore the impact of competitive threat is quite low for Unilever Plc. Colgate, one of the top business unit of Colgate-Palmolive is having products for household sector, non-durable products for household category and luxury goods. This company even though has limited products, however the market share in increasing due to the demand from more health-conscious people (Stobbs, Weller and Zhou 2017). Moreover, Novartis manufactures best quality generic drugs and pharmaceuticals, which are recently creating more value for money among people of UK, imposing a threat to Unilever Plc. Furthermore, Pfizer is also a pharmaceutical company which has great distribution channel and brand awareness among people of UK, which is acting as a threat for Unilever market growth. Finally, AstraZeneca is another pharma company that has started to penetrate in personal care products in UK, which is a threat from new market entry for Unilever Plc.

Reference List

Chowdhury, M.A., Simu, T.H. and Uddin, M.B., 2016. Performance Evaluation of LeadingFMCG Company in Sylhet Metro City: a Case Study on Selected Products of Reckitt Benckiser Group PLC (RB) in Sylhet Region. Journal of Governance and Innovation, 2(1).

Christodoulides, G., Cadogan, J.W. and Veloutsou, C., 2015. Consumer-based brand equity measurement: lessons learned from an international study. International Marketing Review, 32(3/4), pp.307-328.

Davis, D., Chelliah, J. and Minter, S., 2014. New product development processes in the Australian FMCG industry. Contemporary Management Research, 10(1), p.3.

Keller, A.A., Vosti, W., Wang, H. and Lazareva, A., 2014. Release of engineered nanomaterials from personal care products throughout their life cycle. Journal of nanoparticle research, 16(7), p.2489.

Moses, H., Matheson, D.H., Dorsey, E.R., George, B.P., Sadoff, D. and Yoshimura, S., 2013. The anatomy of health care in the United States. Jama, 310(18), pp.1947-1964.

Pant, A. and Ramachandran, J., 2017. Navigating identity duality in multinational subsidiaries: A paradox lens on identity claims at Hindustan Unilever 1959–2015. Journal of International Business Studies, 48(6), pp.664-692.

Patil, Y.J. and Sarode, A.P., 2017. Growth of Personal Care Product Market in India. International Journal of Research in Finance and Marketing, 7(7), pp.65-73.

Payaud, M.A., 2014. Marketing strategies at the bottom of the pyramid: Examples from Nestle, Danone, and Procter & Gamble. Global Business and Organizational Excellence, 33(2), pp.51-63.

Simms, C. and Trott, P., 2014. Conceptualizing the management of packaging within new product development: A grounded investigation in the UK fast moving consumer goods industry. European Journal of Marketing, 48(11/12), pp.2009-2032.

Stobbs, J., Weller, G. and Zhou, Y., 2017. Overview of United Kingdom Trade Marks and Design Decisions 2016. IIC-International Review of Intellectual Property and Competition Law, 48(2), pp.195-207.

Szmigin, I. and Gee, V., 2017. Mystification and obfuscation in portion sizes in UK food products. Journal of Business Research, 75, pp.176-184.

Tandon, M.S. and Sethi, V., 2017. An Analysis of the Determinants of Consumer Purchase Behavior Towards Green FMCG Products. IUP Journal of Marketing Management, 16(3).

Trott, P. and Simms, C., 2017. An examination of product innovation in low-and medium-technology industries: Cases from the UK packaged food sector. Research Policy, 46(3), pp.605-623.

Unilever.com. 2017. Unilever Annual Report and Accounts 2016. [online] Unilever.com. Available at: https://www.unilever.com/Images/unilever-annual-report-and-accounts-2016_tcm244-498880_en.pdf [Accessed 13 Dec. 2017].

Unilever.com. 2017. Unilever global company website | Unilever Global. [online] Available at: https://www.unilever.com/ [Accessed 13 Dec. 2017].