UNILEVER IN BRAZIL (1997-2007): MARKETING STRATEGIES FOR LOW-INCOME CONSUMERS, Relerencono 54-009-1 “achical aesitance 1 +44 (1234 756610, ecchpcecncam Nr Ameen cuore 117812395884, ecchsagecchcom 'fyouarehaving problems opening his document vit wantacth compel forgudance, Qs cesirvrins FE504-0084 INSEAD ‘The Business School for the World” Unilever in Brazil (1997-2007): Marketing Strategies for Low-Income Consumers Ree ere ee ‘+ Overall winner of the 2008 European Case Clearing House Awards ‘+ Winner of a 2007 European Case Clearing House Award in the category “Marketing” ‘+ Winner of the European Foundation for Management Development Case of the Year Award 2004 in the category “Marketing” 40088188 ‘Tis case was propared by Potro Pacheco Guraraos, INSEAD MBA 2003, and Parte Chandon, Associate Professor ot Marketing at INSEAD, asthe baie for clase discus vather than. to lsat ether efecve or inactive ‘Banding of tn admintvatve stuaton. Wo thane Leer Cardoso ar Rober Bavieon from Unleves Baal for ‘making ts caso posible, We alse thank Fernando Machado (INSEAD MBA 2003), Mauro Miteiman (NSEAL Pa ‘Staden), Weima Berara QB dstbutory, Ceara Bran), and Loca Latanei (ASEAD Executive NBA 2004) for their (Copyright © 2007 INSEAD504-0084 INSEAD ‘After three successful yeas inthe Personal Care division of Unilever in Pakistan, Lacrcio Cardoso was contemplating an atractive leadership position in China when he received @ ‘hone call fom the head of Unilever’s Home Care division in Brazil his native county. Robert Davidson was locking for someone to explore growth opportunities inthe marketing ‘of detergents to low-income consumers living in the Northeast of Brazil An alumnus of INSEAD’s Advanced Management Programme, Laercio had joined Unilever in 1986 afer graduating in busiress administration from Fundasto Getuio Vargas in Sao Paulo. He thus had the seniority ad marketing skills that were necessary forthe project. More important he had never been involved inthe traditional approach to marketing detergents and, having Witnessed the success of Nirmal in India, he was acutely aware of the threar posed by local brands targeted a low-income consumers. For this project, named “Everyman”, Laerio asembled an intedisciplinary team including ‘Marcos Diniz from Sales, Antonio Conde from Finance, and Airon Sinigaglia fom “Manufacturing. The frst phase of the project involved extensive field stues to understand the lifestyle, aspirations, shopping and laundry habits of low-income consumes. Kt was daring ‘one ofthese rps that Laereio met Maria Conceiga, pictured on the caver page in her home in Fortaleza, where she lived with her daughter, Elizangela, 19 shown on the right with two of her four children). Like almost everyone in Brazil, Mara told Laercio fat although she ‘would love to buy Omo, Unilever's flagship brand, her tight budget meant tht she could only afford cheaper loca brands. ‘Back at Unilever'sveadquaters in Sdo Peulo, Lacrio prepared for an important meeting with Davidson to decide whether the company should change the way it marketed its detergent brands to low-income consumers in the Northeast, Increasing detergent usage by Maria and ‘the other 48 million preéominantly low-income consumers in Brazil's Northeast was crcil for Unilever, giver thet the company already had an 81% share of the etergeat powder category. However, many in the company believed that large multinational like Unilever should not fightin the lowerend ofthe market, where even small, local entepreneurs with & lower cost structure strgeled to break even. How could one justify diving money from ‘Ono to invest ina ower-margin segment? Deciding to target low-income consumers in the Northeast would throw up some more dificult questions: Should Unilever change its curent marketing and brandng strategy? For example, could Unilever extend or reposition its existing, cheaper brands, Minerva and Campeizo, or would a new brand be necessary? What would be the ideal positioning and marketing mix ofa Unilever brand targeted at low-income consumers? Finding the answers ‘would not be easy as few at Unilever (or other multinational firms) hed axy knowledge of Jow-income consumers or first-hand experience ofthe kind of marketing stategy that would work for this segment. TW aow-pce deere develpe by «smal Indian engrener, quickly aed 4G of the Indio etre ast ain Unlever ina star second place wa 2% mares, For ore norton ‘on Nima S “Hindustan Leer Lime: Lover fr Chane” by Carte Br aod Suan Cha AUNSEAD Case 30219941 © 2002, Ccoprgtxe nor s8e4 : one 8188