Changing tides, changing business models—and those shifting with them are reaping the benefits. After eliminating the word “normal” from all personal care packaging and advertising in a bid to champion more inclusive and diverse visions of beauty, as well as founding a platform to support social commerce start-ups and scale-ups, Unilever decided further changes needed to be made. In July 2022, the multinational consumer goods company announced its new operational model, the Compass Organisation, to deliver its Compass strategy, a wider mission to become a worldwide sustainable business leader.
The premise of the Compass Organisation restructures Unilever into five business groups to enable “sustainable growth, faster innovation and a profitable future.” These sectors comprise: Beauty & Wellbeing, Personal Care, Nutrition, Home Care, and Ice Cream. This restructuring ensured that each category (and the brands sitting within it) will focus on its own designated strategy, profits, and growth worldwide—thus resulting in faster and simpler operations. “Moving to five category-focused business groups will enable us to be more responsive to consumer and channel trends, with crystal-clear accountability for delivery. Growth remains our top priority and these changes will underpin our pursuit of this,” stated Alan Jope, CEO of Unilever, at the time of the announcement.
Now, Unilever has released the financial results of this restructuring, displaying substantial growth in all categories. Under the leadership of President Fernando Fernandez, the Beauty & Wellbeing business group saw a €10.1 billion ($9.7 billion) turnover in 2021, with the Asia Pacific / Africa region accounting for 54% of growth in 2021. In Q1 of 2022, the company reported an underlying sales growth (USG) of 7.4%, with 9.5% in Q2. Top-performing brands were: Dove, Sunsilk, Clear, Vaseline, TRESemmé, Liquid I.V., and Dermalogica. As one case study showed, the launch of the Pro Derma line by Vaseline, one of its fastest-growing brands, accounted for 20% of the brand’s business in China.
For skin and body products, President of Personal Care Fabian Garcia led Unilever’s roster of brands—Dove, Rexona, Lux, Axe, Signal, Lifebuoy, Closeup—to €11.7 billion ($11.3 billion) in net sales. The Americas (43%) and Asia Pacific / Africa (40%) region represented the largest markets accounting for this 2021 figure. As for 2022, the company reported a 6.7% USG for Q2 2022. Unilever highlighted the technology-driven expansion of its Rexona deodorant brand, which debuted technology that provides 72 hours of sweat and odor protection. The other categories also made high profits: €10.6 billion ($10.2 billion) for Home Care, €13.1 billion ($12.7 billion) for Nutrition, and €6.9 billion ($6.6 billion) for Ice Cream.
More companies are offering increased transparency around their operations and the outcomes of any announced strategies, be they around sustainability or leadership. Unilever’s example adds another talking point for the benefit of a more streamlined and siloed business model. In a world of increasing complexity, sometimes simplicity may just be the solution.
2 Article(s) Remaining