brands and innovation final2 - unilever global … / project / country 7x projectsin 10+ countries...
TRANSCRIPT
Unilever 2010 Investor Seminar
Singapore
Winning with Brands and Innovation
Michael Polk / Geneviève Berger
Strongest volume in 25 years
categories
11/11
MCO’s
19/22
top brands
12/13
6% volume growth year-to-date
Fit to compete in battlegrounds
fabric cleaningIndia
>100bps
18%
fabric cleaningTurkey
5%
>100bps
fabric cleaningThailand
7%
>100bps
Ability to price where necessary
spreadsUK
170bps
5%
dressingsUS
40bps
2%
deodorantsIndonesia
700bps
4%
Bigger Faster
roll-out +30 marketsin 6 months
+€50m innovationturnover year 1
Growth: bigger, faster innovation
Growth: better products
€100m investment inproduct quality
40% reduction inconsumer complaints
Design Delivered
-50%
-40%
quality incidents complaints
Growth: more sustainable products
RAW MATERIALS MANUFACTURE CONSUMER USE DISPOSALTRANSPORT
three big targets across the total value chain
HELP
1 BILLIONPEOPLE IMPROVE
THEIR HEALTH& WELLBEING
HALVEENVIRONMENTAL
FOOTPRINT OFOUR PRODUCTS
SOURCE
100%OF AGRICULTURAL
RAW MATERIALSSUSTAINABLY
Growth: effective advertising
% of ads falling into Green/ Amber/ Red boxes onthe Communication Effective Matrix
Ice Cream Greece Hair Global Tomatoes BrazilDisposal
Growth: strengthening portfolio
Ice Cream Denmark Frozen ItalyDisposal
Hair Global
Making Sharper Choices for Growth
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009
turnover €bn
€40 bn
Categories report against 4 platforms
Fabrics &Surface
Care
PersonalCare
FoodsIce Cream &Beverages
Fabric Cleaning
Fabric Conditioning
Household Care
Deos
Skin
Hair
Oral Care
Ice Cream
Tea
Soy Beverage
Spreads
Dressings
Savoury
Different contribution to turnover
Fabrics &Surface
care
Personalcare
FoodsIce Cream &Beverages
% of Unilever global turnover
18% 30% 19% 33%
Balanced contribution to growth
Fabrics &Surface
care
Personalcare
FoodsIce Cream &Beverages
% of Unilever global turnover
18% 30% 19% 33%
26% 33% 18% 23%
% of 2008-2009 underlying sales growth
With different business dynamics
big global markets
markets start early in income spectrum
more common ‘global’ habits
disruptive innovation creates advantage
toughest competition
strong D&E Unilever market share
Fabrics &Surface
care
Personalcare
FoodsIce Cream &Beverages
Fabrics &Surface
care
Personalcare
FoodsIce Cream &Beverages
big global markets
at home and out-of-home
impulse purchase
technology can create advantage
unique business system (frozen, RTD)
strong global market shares
With different business dynamics
Fabrics &Surface
care
Personalcare
FoodsIce Cream &Beverages
mature, smaller categories
developed world dominated
products not as transferable
technology less disruptive
market development key
strong brands matter
With different business dynamics
Leverage scale where it matters
One Unilever go-to-market
Technology Investment
Dynamic resource allocation
Fabrics &Surface
care
Personalcare
FoodsIce Cream &Beverages
Leverage the differences as well
59%
41%
24%
76% 69%
31%42%
58%
PersonalCare
Ice Cream &Beverages
FoodsFabrics &
Surface care
D&E Developed
Foods is developed world led
14 key cells > 40% of businessGeographic footprint
Sauces & others
Soups
Meals & sides
Frozen meals
US, Germany
Germany,France, NL
N America, Germany
USA
Spreads
Dressings
N America, Germany, UK
N America, France, Brazil
Developed
D&E31%
69%
Habits govern expansion potential
0
5000
10000
15000
20000
0 1000 2000 3000
Spreads market size €m
Bre
adm
arke
tsi
ze€
m
Spreads & Breads Markets Correlate Win Where We Are
D&E vs D % of Sales
Focus on core of our portfolio
2010 total development cost
20
10
Un
der
lyin
gSa
les
Gro
wth
Less productive
More productive
Foods
less productive innovation yield win on the fundamentals
brands
product quality
advertising
market development
Fabrics and surface care is D&E led
Developed
D&E76%
24%
insidetoilets
+100%
fridgefreezers
+190%
microwaveovens
+130%
washingmachines
+230%
in BRIC alone, by 2020
kitchensinks
+115%
Source: CMI
geographic footprint major market development opportunity
Foundation for emerging markets
0%
25%
50%
75%
100%
Cote D'Ivoire Morocco Vietnam Romania Sri Lanka Bangladesh
Fabrics & Surface Care Rest of portfolio
portfolio composition (% total turnover)
Opportunity to reach more than we do
Super premium Ice Cream
Machine dishwash
Deodorants
Personal wash liquid
Ice Cream OOH
Fabric solution wash
Shampoo
Toothpaste & Toothbrushes
Bar soap
Small surface cleaners powder
Population Reach
6 bn
3.9bn
1.8bn
0.9bn
2.4bn
0 5000 10000 15000 20000 25000
GDP / capita $
$350
penetration opportunity portfolio deployment opportunity
Country DIG Skip Surf FabCon
Romania
UK
Finland
Norway
Austria
Sweden
Belgium
Pakistan
South Africa
ANZ
Malaysia
Algeria
Morocco
Tunisia
Turkey
French R. Africai
Ghana
Gulf ii
China
Philippines
Brazil
Ice Cream & Beverages global & big
massive, global markets
38 billion liters market of tea
Ice Cream €50bn+ market
leading positions
Personal Care most global business
Developed
D&E58%
42% Developed
D&E53%
47%
Pre-acquisitions Post-acquisitions
Innovation and marketing driven
Pond’s Gold Radiance Clear Relaunch
Dove Hair Relaunch Dove Men+Care
Opportunity to develop the market
538
3,100
1997 today
Latin America deodorant market
27%% of global
market 10%
44%of global
market growth
Source: euromonitor
markets can explosively grow
0 5 10 15 20
0
2
4
6
Thousands
Spending per Head $ (PPP) '000's
Ma
rke
tS
ize
$p
er
He
ad
All Purpose Bars Other Personal Wash
Personal Wash
GDP Per capita (PPP) $‘000s
enable access to our brands early
Choices more interventionist
Deploy resources to big, fast growing, higher margin categories2
We will win everywhere (but leverage different approaches to win)1
Scale choices through absolute consistency in execution5
Maximise what we have by fully deploying the portfolio3
Leverage technology and innovation to win4
Enabled by new ways of working
StrengthenedCapabilities
New businessmodels
Categoryintervention
Disciplined useof resources
Working together seamlessly
Consumer needsMarketing
Customer needsCustomer Development
TechnologyR&D
Brand conceptsCategory
Progress across the metrics
bigger+75%
iTO / project /country
7xprojects in
10+ countries
better
€100minvestmentin quality
faster
35markets
50markets
30+6x
€50miT/o AxeHair US
Yr 1
Unilever 2010 Investor Seminar
Singapore
Winning with Brands and Innovation
Michael Polk / Geneviève Berger
Dis
rup
tio
n
Big
mar
ket
imp
act
Bigger, Better, Faster Innovation
Manycategories
ManycountriesConsumer need
Technology
Time
What does “leveragingacross categories” look like?
Blue whiteningtechnology
In market
Filtration Emulsion scienceSurface
modification
What does “disruptive technology”look like?
Materialsscience
2010
Processscience
2010
Visualisation andmodellingtechniques
2010
Plant/nutritionscience
2010
Structuringscience
2009
How we are building a robustinnovation pipeline
Genesis New waysof innovating
Underpinning supportCriticalfunctional capabilities
Underpinning supportCriticalfunctional capabilities
New waysof innovating
Genesis
How we are building a robustinnovation pipeline
Genesis as it looks at end 2010
Foods
Each fieldwith multipledeliverablesacrosscategories
Fabrics &Surface Care
Personal Care Ice Cream &Beverages
Genesis
Genesis
Genesis
Genesis
Genesis
Genesis
Genesis
Genesis
Genesis
Genesis
Genesis
Genesis
Genesis
Genesis
Genesis
Genesis
Genesishas become the way we work
We arelengthening and
strengthening ourinnovation pipelineand are increasing
the value
Dynamic process
On track to deliver
Genesis
Underpinning supportCriticalfunctional capabilities
New waysof innovating
How we are building a robustinnovation pipeline
Open innovationSupplier partnerships
New businesses unit
We are innovating in new ways
48% of Unilever pipelineleverages Open innovation
31% of new products inconsumer staples containexternal technology in 2010*
* Corporate Executive Board -The Research and Technology Executive Council 2010 Budget, Spend, and Performance Survey
AfterCourtesy Robert Weiss, M.D., Hunt Valley, Maryland
Before
An experimentallight-basedsystem to addressfacialrejuvenation
New businesses unitWe are pushing boundaries
EXAMPLE 3
Partnership with Ampere –Spin-off fromEdison Pharmaceuticals
EXAMPLE 4
New businesses unitWe are pushing boundaries
Genesis New waysof innovating
Underpinning supportCriticalfunctional capabilities
How we are building a robustinnovation pipeline
Low High
Accessing global talent
Inventor countries 2006-09
Unilever Company 1
Company 2
Critical functional capabilitiesBuilding strong patent portfolios
EFSA state of play
Critical functional capabilitiesClinical trials to support our claims
Proportion of claims withpositive opinionUnilever
relevant
100%
Industryaverage
~20%
Conclusion
Strong R&D capability• working differently• strong science base
Clear strategy in place• focus, prioritisation, disruption, cross-category
leverage
Strong innovation pipeline• Genesis on track• innovating in new ways