SUBMITTED BY: Faraz Zafar SUBMITTED TO: Maam Sobia Shujat CLASS: BBA-1 SUBJECT: Marketing REG NO:

20140 TOPIC: Report on Unilever

INTRODUCTION TO UNILEVER PAKISTAN

Unilever is one of the world's leading suppliers of fast moving consumer goods across Foods and Home and Personal Care categories. Unilever's portfolio includes some of the world's best known and most loved brands.

Unilever Pakistan Ltd:

Unilever Pakistan (70.4% Unilever equity) is the largest FMCG company in Pakistan, as well as one of the largest multinationals operating in the country. Unilever Pakistan Ltd., a subsidiary of the Unilever Group is operating in Pakistan since 1948. The Companys main business lines are Soaps and Detergents, Personal Products, Cooking Oils and Fats, Packed Teas, and Ice Creams. Unilever has a long list of brands such as Surf, Vim, Rin, Lifebuoy, Sunlight, Lux, Rexona, Sunsilk, Close-Up, Blue-Band, Dalda, Planta, Liptons Yellow Label, Taaza and Richbru, Brook Bonds Supreme and Kenya Mixture etc. which are common household names in Pakistan. The Companys factory at Rahim Yar Khan was one of the first industrial units to be constructed after the creation of Pakistan. As the consumer base expanded over the years and the Company entered into new product lines like Personal Products and Margarine, it invested further in the installation of modern manufacturing facilities including a factory at Karachi. Today, the Company is using latest state-of-the-art technology for producing high quality products. In 1995, the Company established a new factory near Lahore to manufacture the Walls range of ice creams, which have become popular within a short time. In 1996, the present group Unilever UK acquired the Polka Group that produced ice creams. In 1999, Pakistan industrial promoters (Private) Limited, owners of Polka brands of Ice Cream were merged with Lever. In order to leverage the synergies of Unilevers international brand strength, market edge and corporate image, Lever Brothers Pakistan Ltd. changed its name to Unilever Pakistan Ltd., in August 2002.

Overview of Unilever Pakistan Ltd.

The company had a turnover of Rs. 23.3 bn (Euro 309 mn) in 2007, and enjoys a leading position in most of its core Home and Personal Care and Foods categories, e.g. Personal Wash, Personal Care, Laundry, Beverages (Tea) and Ice Cream. The company operates through 5 regional offices, 4 wholly owned and 6 third party manufacturing sites across Pakistan. OUR VISSION:
Touching Hearts, Changing Lives.

OUR MISSION:
Mission Is To Add Vitality To Life. We Meet Everyday Needs For Nutrition, Hygiene and Personal Care With Brands That Help People Feel Good, Look Good and Get More Out Of Life. Unilever Page 2

Adding Vitality to life:

150 million times a day, in 150 countries, people use our products at key moments of their day. In the future, our brands will do even more to add vitality to life. Our vitality mission will focus our brands on meeting consumer needs arising from the biggest issues around the world today ageing populations, urbanization, changing diets and lifestyles.

The BCG Matrix :

It provides a useful way of looking at the opportunities open to you, and helps you analyses which segments of your business are in a good position and which ones arent. That way, you can decide on the most appropriate investment strategy for your business in the future, and where best to allocate your resources.

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STARS:
Stars are high market share / High market growth. Here you are well established, and growth is exciting. These are fantastic opportunities, and you should work hard to realize them Star Products are: 1. Brooke Bond Supreme 2. knorr noodles 3. Knorr rice make a meal 4. Lipton green tea 5. Sunsilk 6. Ponds Face Wash

CASH COWS:
High Market Share / Low Market Growth. Here you are well-established, so it's easy to get attention and exploit new opportunities. However it's only worth expending a certain amount of effort, because the market isn't growing and your opportunities are limited. Cash Cow Products are: 1. Blue Band 2. Knorr sauces 3. Lipton Yellow Label 4. Rafhan custard 5. Rafhan jelly 6. Rafhan kheer 7. Rafhan pudding 8. Wall's ice creams
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9. Glaxose - D 10. Lifebuoy soap 11. Lux 12. Surf excel 13. Close up 14. Fair & Lovely

QUESTION MARKS:
Question marks are Low Market Share / High Market Growth. These are the opportunities no one knows what to do with. They aren't generating much revenue right now because you don't have a large market share. But, they are in high growth markets so the potential to make money is there. Question Marks might become Stars and eventual Cash Cows. Question Mark Products are: 1. Brooke Bond A1 2. Knorr soups 3. Knorr yakhni 4. knorr make a meal 5. knorr palao cubes 6. knorr chicken cubes 7. Pearl Dust 8. Rafhan corn oil 9. Rafhan Icecream 10. Rafhan magic 3 11. Lifebuoy shampoo

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12. Clear 13. Comfort 14. Flora margarine spread 15. Ponds Moisturizing Lotion

DOGS:
Dogs are Low Market Share / Low Market Growth. In these areas, your market presence is weak, so it's going to take a lot of hard work to get noticed. Also, you won't enjoy the scale economies of the larger players, so it's going to be difficult to make a profit. Dog Products are: 1. Energile 2. Rexona deodorant 3. Ponds Cold Cream 4. Ponds Sunscreen Lotion

SWOT ANALYSIS:
Swot analyses of Unilever are as follows Strengths:
Customers Loyalty. Latest state of the art facilities and technology for producing high quality products. International brand strength. Committed to business ethics, safety, health, environment and community.

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 UNILEVERs key competitive advantage over other market participants is the retail reach of the company. UNILEVER services 500,000 outlets with 50 % through direct distribution and remaining via wholesalers. UNILEVER is enjoying market edge of 41% in FMCG industry. UNILEVER is at number one in ice cream segment and having 14% market share all over the globe.

Weaknesses:
The biggest challenge in safeguarding market position is to become cost leader. Operational complexity due to a large number of products in portfolio and due to diverse work force. Strategic alliance with other small mills for manufacturing purpose is the weakness as well as a threat for UNILEVER. Although UNILEVER claims that it is a part of its cost reduction strategy but it can not hide the reality that it shows weakness of UNILEVER.

Opportunities:
Markets of developing countries can be proved a profitable segment because people are consumption oriented rather than saving or investment oriented. UNILEVER can gear up its market share in the untapped rural market. Diversification in unrelated business. Changing life style of people New markets Increase the volume of production Low income consumers Help in improving people diet & daily lives

Threats:
FMCG market is highly responsive to economic conditions, inflation and social disruptions resulting in variations in sales revenues and demand for the company. P & G is the major competitor and threat for UNILEVER. Other organized players are Nestle and R & B. UNILEVER is facing intense competition from unorganized players i.e. cheaper smuggled products and Chinese products. According to industry source, 40% of tea consumed locally and a large portion of HPC products are smuggled into the country.

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 Legal, political and regulatory factors of host country. For example, supportive Government policies for attracting FDI, 1% tax rate on corporate profit and inability of Pakistan Government to control smuggled products etc. Rapid increase in raw material cost and supply disruptions from suppliers of raw material. The unprecedented surge in palm oil, tallow prices and other materials has resulted in declining margins. Going forward, high raw material costs are a key risk to UNILEVERs profitability.

ANSOFF MATRIX:

This matrix suggests four alternative marketing strategies: 1. Market penetration - involves selling more established products into existing markets, often by increased promotion or price reductions or better routes to market, for example online. 2. Product development - involves developing new products or services and placing them into existing markets. 3. Market development - entails taking existing products or services and selling them in new markets. 4. Diversification - involves developing new products and putting them into new markets at the same time. Diversification is considered the most risky strategy. This is because the business is expanding into areas outside its core activities and experience as well as targeting a new audience. It also has to bear the costs of new product development.

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Based on the ansoff matrix Unilever falls in the growth strategy of Market penetration of existing products.

Maintain and sustain competitive advantage in the D&E markets where which is expected to continue to grow Focus on enhancing brand awareness in the developed markets like the UK Develop cross selling and other initiatives to increase usage by existing customers The rationale behind this strategy is that with such fierce competition, Unilever's rivals will unsurprisingly be doing all they can to increase their market share and that will include offering products at low prices. Unilever, by employing the market penetration strategy, will effectively be doing business as usual, while employing cost cutting measures designed to bolster profits. This strategy is less risky especially in an environment of a global economic downturn (Johnson & Scholes, 2006). It is also recommended that the strategy be achieved through organic growth as opposed to other activities like mergers and acquisitions which have high potential for failure. In terms of competitive strategy, it is recommended that a combination of cost leadership and differentiation be employed. Although Porter argues for a single generic strategy (1998b), this is not always the best option because customers will require different thing from the same product. For example, for the success of the Lynx brand is because it combines low price with perceived coolness. This combined generic strategy has great chance of success as it enables Unilever to be price competitive while also using obtained brand loyalty to keep customers from rivals. Choosing the right strategy is important. However, more important is the successful achievement of the strategy. This will involve effective deployment of Unilever's resources (those used in the internal analysis above) to achieve set objectives. Communication is also key to ensure that those responsible for implementing the strategy buy into it sufficiently to be motivated enough to implement it successfully (Johnson & Scholes, 2006). Finally, it is important that once implemented the strategy should be monitored regularly with a view of making changes or enhancing it as required to achieve set objectives.

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