Unilever Primes Mob Of New Brands To Be ‘Future Fit’ In Hyper-Fragmented World

Unilever’s growth focus will continue to be its core assets, but in a hyper-fragmented global marketplace the firm is escalating new brand creation, with more than a dozen in the pipeline. The firm’s Alan Jope, president of personal care, discusses.

Unilever NV has introduced seven new brands across various markets in the last 18 months, on top of its busy M&A schedule, and according to Personal Care President Alan Jope, the company’s just getting started.

“Expect to see lots more new brand launches from us in the coming quarter,” he said Sept. 5 at the Barclays Global Consumer Staples Conference in Boston.

In fact, Jope added provocatively, “I'm not sure if I should say this, but we've got over a dozen qualified, ready-to-go brands on top of the ones that you've already seen.”

“As soon as we said we’re in the business of creating, developing and launching new brands, we had a flood of new ideas. You know our young millennial marketers are joining Unilever precisely to create brands like the ones that you see in there,” Jope said.

The idea is to be “future fit” in today’s hyper-fragmented world, according to the exec. In his words, “a more fragmented world is going to require a more fragmented portfolio,” reflecting pockets of custom innovation to meet local needs and tastes.

He pointed to Lever Ayush, “made with 5000 years of Ayurvedic wisdom” to resonate with Indian consumers, as well as recently launched K-Bright, which capitalizes on Korean beauty trends and skin-brightening demand for maximum impact in Southeast Asian markets.

Jope called the latter “a huge opportunity for us.”

Then there’s Hijab Fresh, aimed at young headscarf-wearing Muslims – “a very fast-growing segment in the world,” Jope noted. The line debuted in Indonesia with shampoo and has since expanded to body care. (Also see "Unilever Goes Local With Personal-Care Innovation, Projects H2 Impacts" - HBW Insight, 25 Jul, 2017.)

KJU, an offshoot of Unilever’s LUX personal-cleansing brand, offers shower gels and body mists “inspired by floral fragrances from Jeju Island, South Korea.” Jope has clarified previously that the brand initials are not a nod to North Korea’s supreme leader.

ApotheCARE is tailored more to Western conventions, marketed with the tagline “Purity of Nature. Progressed by Science,” while Skinsei – “personalized skin care based on how you eat, sleep, live” – is a direct-to-consumer subscription business that will be relaunching later this year based on learnings from a recently completed beta release.

Finally, Love Beauty and Planet is on track to do more than $60m in first-year sales after debuting stateside and is already profitable, according to Jope. (Also see "Unilever's Response To 'Tectonic Shifts': Unprecedented M&A, Innovation" - HBW Insight, 5 Feb, 2018.)

“That the biggest at the moment,” he said. “We know that more and more consumers today want brands to stand for more than just great products, and that's reflected in the early success of Love Beauty and Planet.”

Unilever will be taking the ecologically conscious hair- and skin-care brand into new markets around the globe and new product categories in coming quarters.

Asked whether Unilever tapped outside resources to bring the new brands to life, Jope insisted that “all the organization really needed was permission. As soon as we said we’re in the business of creating, developing and launching new brands, we had a flood of new ideas.”

He added, “You know our young millennial marketers are joining Unilever precisely to create brands like the ones that you see in there.”

Fresh Approaches In Mass Marketing ‘Twilight Years’

According to Jope, Unilever has nearly doubled in size since 2008, adding some €10bn in turnover, and two-thirds of that has come from organic growth.

Acknowledging the strong natural theme across new Unilever brands, the exec said 60% of new SKUs introduced in the global beauty and personal-care market this year were natural-oriented.

Unilever’s increased naturals focus is evident not only in new brands’ DNA but also in the firm’s recent acquisition targets, including Equilibra, a fast-growing skin- and hair-care player in Italy that also markets nutritional supplements. (Also see "Unilever Continues Full Steam Ahead With ‘Natural’ Moves, Projects Up To 5% USG For Full Year" - HBW Insight, 23 Jul, 2018.)

Meanwhile, Schmitd’s, acquired early in 2018, is performing “extremely well,” Jope said. The brand’s portfolio now includes soap and toothpaste in addition to the deodorants on which it was founded. (Also see "Unilever And Givaudan Buy Natural; More Cosmetics M&A In Brief" - HBW Insight, 20 Dec, 2017.)

Prestige beauty is another priority area for Unilever. Hourglass, picked up in summer 2017, is helping in that department, recording 40% growth year-to-date, according to the exec. (Also see "Cosmetics News In Brief: Unilever Moves Into Makeup; L'Oreal Divests The Body Shop; More" - HBW Insight, 29 Jun, 2017.)

In line with its peers, Unilever has shifted resources to build its e-commerce and digital marketing capabilities. More than a third of the company’s media spend in 2018 thus far, in excess of €400m, has gone to digital initiatives, and e-commerce, up 65% year-to-date, now accounts for 6% of its health and beauty business.

Jope offered perspective: “I don't think it's going too far to say that the 120-year-old model of mass marketing is entering its twilight years. Mass marketing – that's mass consumer segments targeted with brands sold only in mass channels using mass interruption-based marketing – is an endangered species.”

Unilever also is looking to new emerging markets for growth. According to Jope, 20% of Unilever’s growth over the next three to four years will come from Myanmar, Bangladesh, Pakistan and Ethiopia.