DAYANANDA SAGAR UNIVERSITY
SCHOOL OF COMMERCE AND MANAGEMENT STUDIES
Hosur Main Road, Kudlu Gate, Bangalore-560068
Master of Business Administration
Assignment 1 - Strategic Management
Topic: Analysis on Unilever
By: Sumaiya Kauser
USN: CMS23MBA216
3st semester MBA Section D
Under the guidance of Dr. Shwetha Tiwari
Department Of MBA, School of Commerce and Management Studies,
DSU, Bangalore 2025-2026
UNILEVER: COMPANY ANALYSIS
Overview of Unilever:
With products used by around 3.4 billion people every day and a presence in more than 190
countries, Unilever is one of the top fast-moving consumer goods (FMCG) firms in the
world. Unilever was established in 1929 as a result of the combination of Lever Brothers and
Margarine Unie. Since then, it has grown to become a major force in the food, beverage,
home care, and personal care industries.
Dove, Knorr, Lipton, Hellmann's, Magnum, Rexona, and Surf are just a few of the well-
known brands in Unilever's portfolio of over 400 brands, which is headquartered in London.
From wholesome foods and drinks to personal hygiene and housekeeping products, these
companies serve a wide range of customer demands.
SWOT Analysis of Unilever
Strengths:
1. Robust Brand Portfolio: With over 400 brands, including well-known names like Dove,
Knorr, Magnum, Lipton, and Rexona, Unilever boasts a broad portfolio. It can accommodate
different market niches and customer preferences because to its great brand equity.
2. Global Market Presence: With operations in more than 190 nations, Unilever has a strong
global footprint. Approximately 60% of its sales comes from emerging regions. Being
geographically diverse lessens reliance on any one market.
3. Put Sustainability First: Unilever is a pioneer in environmentally friendly operations,
with plans to achieve net-zero emissions by 2039 and 100% recyclable packaging by 2025.
This dedication improves company standing and fits nicely with consumers' shifting tastes for
environmentally friendly goods.
4. Robust Financial Performance: Unilever exhibits steady development, bolstered by cost
control and operational efficiency, with yearly revenues of roughly €59.6 billion (2023).
5. Innovative Supply Chain: By investing in supply chain innovation and digital
transformation, Unilever has improved operational efficiency, guaranteed on-time delivery,
and reduced costs throughout its international operations.
Weaknesses:
1. Over-reliance on Emerging Markets: Although these markets generate a sizable portion
of Unilever's income, they also expose the company to political and economic unrest,
exchange rate swings, and regulatory issues.
2. Competitive Pressure: Procter & Gamble, Nestlé, and Colgate-Palmolive are just a few of
the fierce competitors in the FMCG sector. Unilever's capacity to increase its market share
without making large expenditures in marketing and innovation is constrained by this rivalry.
3. Product Recall Risks: Managing a large product line raises the possibility of quality
control problems or product recalls, which can erode customer confidence and harm a brand's
reputation.
4. Price Sensitivity: In price-sensitive markets, where rising input prices or inflation may
have an effect on sales and profitability, Unilever sells a large number of its products.
Opportunities:
1. Growth in the Health and Wellness Sector: Unilever can increase the range of plant-
based foods, nutritional supplements, and personal care items it offers as a result of
growing customer interest in health and wellness. The company is well-positioned in this
market with brands including Liquid I.V. and The Vegetarian Butcher.
2. Digital and E-commerce Expansion: By making more investments in e-commerce
platforms and direct-to-consumer channels, which now generate 15% of its sales, Unilever
can take advantage of the expanding trend of online shopping.
3. Product Innovation: You may draw in premium and eco-aware clients by launching
new items in markets like eco-friendly cleaning supplies, sustainable packaging, and
customized cosmetics.
4. Growth into Emerging countries: Unilever has a great chance to further establish
itself in these rapidly expanding countries due to rising demand in areas like Asia-Pacific,
Africa, and Latin America.
5. Strategic Partnerships and Acquisitions: Unilever may improve its position and
broaden its product line by working with creative startups or purchasing businesses in the
plant-based, health, and beauty industries.
Threats:
1. Intense Competition: Global firms like Procter & Gamble, Nestlé, and Johnson &
Johnson are fighting for market dominance in the fiercely competitive FMCG sector. In
emerging markets, local brands exacerbate the strains of competition.
2. Political and Economic Instability: Due to its significant reliance on emerging markets,
Unilever is susceptible to changes in governmental legislation, currency fluctuations, and
economic downturns.
3. Increasing Input Costs: Unilever's profit margins may be impacted by rising energy,
transportation, and raw material prices, particularly in price-sensitive areas.
4. Changing Customer Preferences: Unilever must constantly innovate and adapt due to the
quick trend toward local brands, organic products, and sustainability, which necessitates a
large investment.
5. Regulatory Challenges: Unilever faces compliance risks due to stringent laws governing
product safety, advertising standards, and environmental effect in several jurisdictions.
BCG Matrix for Unilever
The BCG Matrix categorizing its products into Stars, Cash Cows, Question Marks, and
Dogs:
1. Stars (High Growth and Market Share) :
These are the top items offered by Unilever in rapidly expanding markets. To keep and
expand their market supremacy, they need to make constant investments.
• Dove (Personal Care): With steady demand and growth in high-end personal care, Dove
leads the skincare and hygiene sector.
• Krorr (Food Items): With its breakthroughs in meal packages, seasonings, and soups, Knorr
remains a dominant force in the food market.
• Magnum (Ice Cream): Thanks to its powerful branding and decadence, Magnum commands
a substantial portion of the premium ice cream industry.
The market dominance of Rexona, Sure, and Degree deodorants can be attributed to the
steady demand for personal hygiene goods.
2. Cash Cows (Low Market Growth, High Market Share) :
Despite operating in developed, slow-growing marketplaces, these products bring in a sizable
sum of money. With little investment, they offer financial stability.
• Surf Excel (OMO/Persil) (Home Care): Consistent cash flow is offered by Surf Excel and
its variations, a leading laundry detergent manufacturer.
• Lipton (Beverages): Lipton is a well-known tea brand throughout the world, but its growth
is being slowed by competition and market saturation.
• Vaseline: Vaseline is still a well-known skincare brand with a sizable market share, but
there aren't many prospects for expansion.
• Hellmann's (Conditions): In developed areas with consistent demand, Hellmann's
mayonnaise is the industry leader.
3. Question Marks (High Market Growth, Low Market Share) :
Despite having a small market share, these products are found in expanding areas. To
increase performance, they need to make smart investments.
• T2 (Premium Tea): T2 has a small worldwide footprint but competes in the expanding
premium and specialty tea sector.
• Plant-Based Foods: The Vegetarian Butcher is a promising product in the plant-based foods
market, but it competes fiercely with other brands of alternative proteins.
• Love Beauty and Planet (Personal Care): This company, which bills itself as eco-friendly,
needs funding to increase its market share.
• OMO (Laundry Detergent): In competitive markets, OMO finds it difficult to match Surf
Excel's supremacy, despite its success in some areas.
4. Dogs (Low Market Growth, Low Share)
These goods add very little to Unilever's total performance and have little room for
expansion. Repositioning or divesting could be taken into consideration.
• Pepsodent (Oral Care): In comparison to rivals such as Sensodyne and Colgate, Pepsodent
has a small market share.
• SlimFast (Weight Management): As a result of changing health trends and competition from
contemporary wellness solutions, SlimFast has lost commercial importance.
• Brooke Bond (Tea): As consumers turn to premium and organic tea substitutes, traditional
tea firms like Brooke Bond are facing difficulties.
PESTLE ANALYSIS
1. Political Factors
• Regulations and Tax Policies: Because Unilever conducts business in more than 190
nations, it is subject to a number of local regulations and tax policies. The cost
structure and operations may be impacted by modifications to trade tariffs, tax rates,
or laws.
• Government Stability: Unilever faces difficulties with the security of its business
operations, distribution networks, and consumer demand in areas experiencing
political unrest, such as portions of Africa and the Middle East.
• Global Trade Agreements: Unilever gains from free trade agreements that facilitate
easier import/export procedures, such as the EU-Mercosur trade agreement. However,
political unrest like Brexit might have an impact on cross-border trade.
2. Economic Factors
• Global Economic Growth: Unilever's expansion is dependent on the state of the
world economy as a whole. Consumer spending declines during economic downturns
or recessions, particularly in high-end product categories. On the other hand, demand
for better products is increased during economic booms.
• Currency Fluctuations: Because Unilever is a worldwide corporation, it is
susceptible to currency swings, especially in developing nations. When repatriated,
revenues in foreign currencies may be diminished by a strong euro or GBP.
• Income Levels and Consumer Spending: Purchasing power is impacted by shifts in
disposable income. Demand for Unilever's brands may fluctuate between premium
and economy products as more buyers gravitate toward more reasonably priced and
value-driven solutions.
• Supply Chain Costs: Unilever's cost structure is impacted by economic factors, such
as growing prices for raw commodities (such as palm oil and packaging materials).
Price increases brought on by inflationary pressures in different markets may have an
impact on consumer behavior.
3. Social Factors
• Changing Consumer Preferences: Product offers are influenced by a shift towards
sustainability, growing health consciousness, and consumer desire for plant-based and
organic products. By concentrating on healthier ingredients and growing businesses
like The Vegetarian Butcher, Unilever has adjusted.
• Demographic Shifts: Opportunities and challenges are presented by an aging
population in developed nations and an increasing youth demographic in emerging
markets. Unilever must provide specific items (such as anti-aging skincare and
newborn care) to appeal to both ends of the age span.
• Social Media and Brand Image: Consumer behavior is significantly impacted by
social media. Unilever needs to take proactive steps to manage the perception of its
brand, especially in relation to social issues including labor practices, ethical sourcing,
and sustainability.
• Urbanization: Unilever's brands stand to gain from rising consumer spending power,
convenience-driven demand, and a higher retail outlet density as urbanization picks
up speed.
4. Technological Factors
• Digital Transformation: Unilever has made significant investments in digital
marketing and e-commerce, with direct-to-consumer channels growing in
significance. Better decision-making and consumer insights are made possible by its
emphasis on AI and data analytics.
• Product Innovation: Unilever has been able to develop more environmentally
friendly products (such as waterless cosmetics and biodegradable packaging) thanks
to technological advancements. In order to satisfy consumer demands for eco-friendly
solutions, constant innovation is essential.
• Automation and Supply Chain Efficiency: To improve product distribution,
optimize supply chains, and streamline operations, Unilever leverages technology.
This covers real-time supply chain monitoring, demand forecasting powered by AI,
and robotics.
• Research and Development (R&D): Unilever is able to create new goods that meet
consumer needs, like plant-based substitutes or products with a less environmental
impact, thanks to technological developments in food science, chemistry, and
biotechnology.
5. Legal Factors
• Regulations and Compliance: Unilever is subject to stringent laws in a number of
nations pertaining to labor standards, advertising, and product safety. Product
compositions and marketing are influenced by regulatory agencies such as the FDA,
European Food Safety Authority (EFSA), and Consumer Protection Agencies.
• Intellectual Property (IP): It is crucial to safeguard Unilever's valuable technologies,
patents, and brands. Keeping a robust intellectual property portfolio is essential to
protecting the company's ideas as it makes R&D investments.
• Labor Laws and Employment Regulations: Unilever's manufacturing sites across
the globe are subject to labor regulations. Especially in developing nations, this entails
abiding by minimum wage requirements as well as working hours and conditions.
• Environmental Laws: Unilever's manufacturing and packaging choices are
influenced by increasingly strict environmental restrictions (such as those pertaining
to carbon emissions and plastic waste), which force the company to embrace more
sustainable business practices.
6. Environmental Factors
• Sustainability and Climate Change: Unilever is dedicated to minimizing its impact
on the environment. This includes making sure that all packaging is recyclable or
biodegradable by 2025 and reaching net-zero emissions by 2039. The business is also
trying to use less water throughout production.
• Raw Material Sourcing: Unilever prioritizes the sustainable sourcing of raw
materials such as paper, tea, and palm oil. Environmental issues like climate change
and deforestation affect the supply chain and compel the business to use sustainable
procurement methods.
• Consumer Demand for Eco-Friendly Products: As environmental concerns have
gained more attention, there is a greater need for eco-friendly products, which has
compelled Unilever to change its product ranges to include more sustainable options.
For instance, companies like Seventh Generation and Love Beauty and Planet serve
customers who care about the environment.
• Waste Management and Circular Economy: Unilever is committed to advancing a
circular economy and better waste management. By enhancing packaging design and
utilizing more recycled materials, the corporation has pledged to reduce plastic waste.
PORTER’S FIVE FORCES ANALYSIS for Unilever
1. Threat of New Entrants (Moderate to Low)
The barriers to entry in the FMCG sector can be relatively low, especially for small niche
players. However, for large global companies like Unilever, the threat of new entrants is
reduced due to several factors:
• Brand Loyalty and Recognition: New entrants find it challenging to successfully
compete in terms of consumer trust and loyalty due to Unilever's portfolio of well-
known and dependable brands, such as Dove, Knorr, and Lipton.
• Economies of Scale: New competitors would find it difficult to match Unilever's
substantial production, distribution, and marketing economies of scale.
• Capital Requirements: New rivals may be deterred by the significant expenditure
needed to have a global presence, wide distribution networks, and R&D capabilities.
• Regulatory and Compliance Barriers: Unilever has to abide by stringent laws in a
number of nations, which can be difficult for newcomers lacking the required funds
and experience.
Although there is room for specialized brands in the market, it is difficult to compete with
Unilever's existing market position, economies of scale, and global distribution networks,
thus the threat of new entrants is generally moderate.
2. Bargaining Power of Suppliers (Low to Moderate)
Unilever sources raw materials from various suppliers globally, including palm oil, tea, soy,
and chemicals. The bargaining power of suppliers in Unilever's case is:
• Supplier Diversity: Unilever sources resources from a variety of vendors around the
world, minimizing reliance on any one source.
• Sustainable Sourcing: To maintain sustainability, Unilever works closely with
suppliers and has stringent sourcing criteria. This might occasionally reduce the pool
of eligible suppliers, giving them more negotiating leverage. The company's extensive
and enduring supplier connections, however, offset this.
• Branding and Buying Power: Unilever can negotiate advantageous terms with
suppliers, lowering their negotiating strength, thanks to its extensive product portfolio
and purchasing power.
• Raw Material Prices: Because of environmental or geopolitical factors, the price of
some raw materials, such cocoa and palm oil, can change. Unilever, however, lessens
this through long-term agreements and efforts to source sustainably.
Overall, the bargaining power of suppliers is low to moderate, as Unilever’s scale and
diversified supply base give it significant leverage.
3. Bargaining Power of Buyers (Moderate to High)
Consumers and retailers hold significant bargaining power in the FMCG industry, which
affects Unilever’s pricing and product strategies:
• Consumer Choices and Preferences: Customers have a lot of options because they
may now choose from a greater variety of brands and items. This is especially true for
goods in the food and personal care sectors, where customers can quickly move
between brands.
• Retailer Influence: Big-box stores like Walmart, Tesco, and Amazon have a lot of
negotiating leverage since they can ask for better margins, lower prices, and
advantageous shelf placement for Unilever's goods.
• Price Sensitivity: Although Dove and other Unilever products are marketed as
premium brands, many consumers are price-sensitive and might quickly move to less
expensive options if prices rise. Customers have more negotiating leverage as a result,
especially in price-sensitive markets.
• Consumer Awareness: As consumers' knowledge of sustainability and ethical
business practices grows, they have more influence over the items they purchase,
which encourages Unilever to develop new eco-friendly and sustainable product lines.
The bargaining power of buyers is moderate to high, influenced by consumer choice, retailer
power, and price sensitivity.
4. Threat of Substitutes (High)
The FMCG industry faces a significant threat from substitute products, particularly as
consumer preferences shift and new alternatives emerge:
• Product Substitutes: Unilever offers readily available alternatives in a number of its
product categories. Customers can, for instance, go from conventional detergents like
Surf Excel to less expensive or environmentally friendly substitutes, or from typical
snacks to more healthful ones.
• Health and Wellness Trends: As consumers' concerns about their health grow, they
are looking for plant-based or organic alternatives to conventional food, drink, and
personal care items. Unilever's current products, such as Magnum and Knorr, are
directly threatened by this.
• Private Label Brands: As alternatives to Unilever's goods, retailers frequently
introduce their own private-label brands. These companies are able to meet the
increasing demand for more reasonably priced goods by lowering their prices.
The threat of substitutes is high, as the FMCG sector is highly competitive with a wide range
of alternatives for consumers.
5. Industry Rivalry (High)
The level of competition in the FMCG industry is intense, with several large multinational
corporations and local players competing for market share:
• Competitors: Major FMCG companies like Procter & Gamble, Nestlé, Coca-Cola,
and Johnson & Johnson are formidable rivals of Unilever. These businesses compete
in comparable product areas, such as food, beverages, home care, and personal care.
• Brand Loyalty and Differentiation: Despite having a solid portfolio of well-known
brands, Unilever faces intense competition and ongoing pressure to innovate and
stand out from the crowd. The temptation to compete is increased by the emergence
of regional brands and niche businesses selling specialized goods.
• Price Competition: Businesses like Unilever are compelled to continuously enhance
operational efficiency and uphold cost leadership due to price rivalry, especially in
categories like laundry detergents and snacks.
• Innovation and Sustainability: Unilever places a strong emphasis on corporate
responsibility, innovation, and sustainability as areas of competition for businesses in
the FMCG sector. But rivals are also using such tactics to win over environmentally
sensitive customers.
Industry rivalry is high, driven by numerous strong competitors, price competition, and the
need for continuous innovation.
Conclusion
Among the many obstacles Unilever faces in its very competitive market are price sensitivity,
competing goods, and intense industrial competition. Nonetheless, its robust portfolio of
brands, global reach, and dedication to sustainability and innovation serve to counteract some
of these pressures. Navigating the competitive landscape will depend heavily on the
company's capacity to capitalize on its size and market share while concentrating on
sustainability and customer preferences.
