What's Happening?
Unilever CEO Fernando Fernandez has announced plans to transform the company into a 'marketing and sales machine' by significantly investing in brand and marketing. The company reported a 3.9% growth in underlying
sales during the third quarter, with volume sales increasing by 1.5%. Fernandez emphasized the importance of expanding margins through savings and efficiency programs while maintaining substantial brand investment. The focus is on beauty, wellbeing, and personal care, which have shown strong performance, with beauty and wellbeing growing by 5.1% in Q3.
Why It's Important?
Fernandez's strategy reflects a shift towards prioritizing high-growth segments like beauty and personal care, which could lead to increased profitability and market share. The commitment to sustained brand investment indicates Unilever's focus on long-term growth and consumer engagement. This strategic direction may influence industry trends and competitive dynamics, as other companies may adopt similar approaches to enhance their market positioning.
What's Next?
Unilever plans to continue increasing its marketing spend, aiming to keep it within 15% to 16% of revenue. The company is also accelerating its shift towards digital channels and ecommerce, with significant growth in platforms like Amazon and TikTok Shop. As Unilever implements its strategy, stakeholders will be watching for further developments in its portfolio and market performance.
Beyond the Headlines
The transformation into a marketing and sales machine highlights the evolving role of consumer engagement and digital presence in driving business success. Unilever's focus on premium and digitally native brands reflects broader industry trends towards personalization and innovation. The company's strategic shift may lead to long-term changes in consumer goods marketing and sales practices.
