Careers at Unilever
Unilever’s mission is to make sustainable living commonplace by supporting sustainability and providing their consumers around the world with the products they need to look good, feel good and get more out of life.
Unilever operates in the fast moving consumer goods industry. It owns a number of globally known brands, such as Dove soaps and Knorr food products.
- Personal Care – including sales of skin care and hair care products, deodorants and oral care products. Personal Care accounts for a turnover of €20.1 billion, accounting for 38% of the groups’ turnover and 48% of its operating profit. Major brands include Dove, Axe, Lux, Rexona, and Sunsilk, all of which are €1 billion brands.
- Foods – including sales of soups, bouillons, sauces, snacks, mayonnaise, salad dressings, margarines and spreads. Foods accounts for €12.9 billion turnover, 24% of the group’s turnover and 31% of its operating profit. Major brands include Knorr, Hellmann’s, and Rama, all of which are €1 billion brands. In addition to manufacturing and selling retail food products, this segment also provides B2B solutions for professional hotel, restaurant and catering customers.
- Home Care – including sales of home care products, such as powders, liquids and capsules, soap bars and a wide range of cleaning products. Home Care accounts for €10.2 billion turnover, 19% of the group’s turnover and 10% of its operating profit. Major brands include Omo and Surf, both of which are €1 billion brands, and Sunlight, Domestos, Comfort and Pureit. This segment generates 80% of its sales in emerging markets.
- Refreshment – including sales of ice cream and tea-based beverages. Refreshment accounts for €10.1 billion turnover, 19% of the group’s turnover and 11% of its operating profit. Major brands include Magnum, Heartbrand (Wall’s) and Lipton tea, all of which are €1 billion brands.
Unilever was formed in September 1929 by the merger of Margarine Unie, a Dutch margarine manufacturer, and Lever Brothers, a British soapmaker – this merger was to take advantage of lower prices for importing palm oil, a major ingredient in soap and margarine. The name “Unilever” came from the combining of the two company names. Unilever’s current mission came from the ideas of William Hesketh Lever, founder of Lever Bros, whose mission 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”.
Over the next 10 years the company made significant investment in Africa, Latin America, the UK and US – it could not do so in Europe due to World War II. The company grew both organically and through acquisitions. Significant acquisitions include a majority stake in Frosted Foods (owner of the Brid’s Eye brand), and Pepsodent, Lipton, National Starch, Brooke Bond, Chesebrough-Ponds, Breyers, Ben & Jerry’s Slim Fast, Best Foods, and Sara Lee.
Business model of Unilever
Unilever segments its business along the lines of product type. Each product type is aimed at a particular group or groups of customers, with some having a ‘premium’ line of brand for more affluent customers. It derives the majority of its sales (58%) from emerging markets.
- Personal Care – Personal Care targets both developed and developing regions through different brands. For example, Lux targets primarily developed markets while Lifebuoy targets developing markets. It also has region specific brands such as Citra, ostensibly for marketing purposes. Unilever has also started a ‘Prestige’ line of business within the Personal Care segment – it recently acquired four premium skin care businesses. This line is aimed at affluent consumers in developed countries
- Foods – Foods targets both developed and developing regions, and the brands are generally targeted as providing household items at reasonable prices with high quality. Examples include Knorr and Hellmann’s. Foods generates 40% of its sales from emerging markets – sales in these markets have been growing at 6.5%.
- Home Care – Home Care generates 80% of its sales in emerging markets.
- Refreshment – Refreshments include both household and premium brands that are targeted accordingly. For example, Lipton, the world’s largest tea brand, is marketed as a household item while Magnum is targeted at more affluent consumers (and is thus available only in more affluent countries).
Unilever’s main value proposition is its branding as a provider of quality goods at reasonable prices. Its scale allows it to produce goods at relatively lower cost while maintaining quality. Its scale also allows access to niche markets, particularly in developing countries. This means that the same Unilever products may be found on shelves in the US and in provision stores on the streets of Thailand. This coverage gives Unilever a strong branding, driving sales.
That said, Unilever owns a significant number of brands, each with its own unique value proposition. For example, Magnum is known for providing quality ice-cream at premium, but not unreasonable, prices. On the other hand, Knorr is known for providing household items, such as stock cubes and sauces, at very inexpensive prices. The consistent narrative is that Unilever products are of high quality, are well designed and effective, and are provided at a price fitting their target customer and use.
Unilever uses a multi-channel approach, with channels depending on the region or country of operation and the brand being sold. For physical retail, it has trading relationships with centrally managed multinational customers, in developed regions, and small traders accessed via distributors in many developing countries.
Unilever also has an e-commerce platform in some countries, and deals with other e-commerce platforms in others.
Unilever relies heavily on culture-driven aspects of its product, i.e. its age, branding, and reputation, in order to sell its services to both retail and institutional clients – it owns 13 €1 billion brands, from Axe to Surf, and has over €17 billion in goodwill.
Well-known for its marketing prowess, Unilever maintains an innovative and adaptive approach to promoting its products. For example it heavily utilizes social media and digital marketing, particularly in developed countries, keeping track of changing digital habits to tailor their marketing approach accordingly.
It also takes a collaborative approach to marketing, using competitions and collaborating with social media celebrities and media companies – examples include All Things Hair, an online video channel that creates content in partnership with vloggers, and its partnership with Vice, a youth media company.
Unilever’s main activity is the production and sale of fast moving consumer goods.
Unilever’s key partners are suppliers upstream, and distributors and resellers downstream. Suppliers can range from large agriculture companies to smallholder farmers, and distributors and resellers can range from supermarket chains to distributors who specialize in small traders. It also partners heavily with media companies to maintain its marketing campaigns.
Aside from its key business partners, Unilever also partners with NGOs and IGOs in order to further its CSR initiatives. Some key partners here include UNICEF and DFID.
Unilever’s key resources are its built-up reputation, branding, and goodwill, and its properties, plants, human resources, and equipment.
Unilever’s key costs are the costs of production (i.e. raw and packaging material and goods purchased for resale), staff costs, distribution costs, and selling and administrative expenses.
Unilever’s key revenue streams are from its four business segments. Personal Care accounts for a turnover of €20.1 billion, accounting 38% of the groups’ turnover and 48% of its operating profit. Foods accounts for €12.9 billion turnover, 24% of the group’s turnover and 31% of its operating profit. Home Care accounts for €10.2 billion turnover, 19% of the group’s turnover and 10% of its operating profit. Refreshment accounts for €10.1 billion turnover, 19% of the group’s turnover and 11% of its operating profit.
|Source of Revenue/Cost||Revenue (FY 2015, million Euros)||% of Total Revenue|
|Cost of sales||(30,808)||-58%|
Raw and packaging materials and goods purchased for resale
Other Cost of Sales
|Selling and administrative expenses||(14,949)||-28%|
Brand and Marketing Investment
Research and Development
Other SG&A Costs
info: Paul holds BBA/BA from the University of Groningen, Netherlands, in 1977 and an MA Economics and MBA finance/international marketing from the University of Cincinnati in 1979. He has been awarded honorary degrees from a number of Universities, including Northumbria, Liverpool, Groningen and the University of Cincinnati. He is also currently a non-executive director of the Dow Chemical Company and Chairman of the World Business Council for Sustainable Development. Prior to joining Unilever, he was an Executive VP and a CFO in Nestle and Group President, Europe and Officer of The Procter & Gamble Company.
info: Graeme holds a bachelor’s degree in Applied Chemistry from Strathclyde University and is a Chartered Accountant. Prior to joining Unilever in 2002, he was Vice President, Corporate Development and Vice President, Finance at FLAG Telecom and a consultant with PricewaterhouseCoopers.
info: Dr Marijn holds a degree in chemistry from Radboud University in Nijmegen, the Netherlands, and a PhD in chemical engineering from the University of Eindhoven. Prior to joining Unilever, he was the CEO of Bayer AG, President of the German Chemical Industry Association, a director in GE, and CEO of Thermo Fisher Scientific.
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