Case Exhibits

Pierre Chandon

Unilever in Brazil:
Marketing Strategies for Low-
Income Consumers
Copyright © 2013 INSEAD
 Map of Brazil and Key Economic and Social
Indicators by Region in 1996
Brazil,
1996: Population, millions
GDP/Capita, US$
Race, % mixed Afro-Brazilian-European
Infant mortality, rate per 1,000

13.0
3,065
68.3
32.7

47.9
2,250
64.5
52.8

11.7
4,400
49.4
26.1

73.0
6,600
28.4
25.7
25.1
5,850
12.6
22.8
0 500 Km
Scale:

Copyright © 2004 INSEAD, Fontainebleau, France. Source: IBGE.

 Distribution of Social Classes in the Southeast
and Northeast of Brazil in 1996
8% 3%
5%
13% 9%

Social classes

24% 30% A (>20)

B (10-20)
C (5-10)
D (2-5)
20%
E+ (1-2)
33%
E- (<1)

(income as multiple
33% of minimum salary)
12%

9%

Southeast Northeast
Note: Social class membership is based on family income, shown here as a multiple of monthly minimum salary
(in 1996, one minimum salary is about $70 per month). Source: IBGE

Copyright © 2004 INSEAD, Fontainebleau, France.

 Penetration and Consumption of Laundry Soap
and Detergent Powder in 1996
Penetration (% of consumers buying at least once per year)

Consumption (kg per year per buyer)

100% 24 kg
96.6% 97.6% 97.2%
88.7%
20.4

75% 18 kg

12.9
50% 12 kg
11.4

6.8
25% 6 kg

0% 0 kg
Southeast Northeast Southeast Northeast

Laundry Soap Detergent Powder

Copyright © 2004 INSEAD, Fontainebleau, France.

 Laercio Cardoso Visiting a Low-Income Family in
the Northeast

Copyright © 2004 INSEAD, Fontainebleau, France.

 Home-made Detergents for sale in Brazil (Left)
and Chile (Right)

Copyright © 2004 INSEAD, Fontainebleau, France.

 Typical Clothe-Washing Scenes
in Brazil's Northeast

Copyright © 2004 INSEAD, Fontainebleau, France.

 Typical Clothe-Washing Scenes
in Brazil's Northeast

Copyright © 2004 INSEAD, Fontainebleau, France.

 Attribute Importance, Brand Positioning,
and Consumer Expectations in the Northeast
Cleanliness, Ability to Harm to
whitening, Smell, remove Dissolving Packaging colors
productivity softness stains power

Importance: 24% 20% 16% 16% 13% 11%

100
Consumer
Expectations
80
Range

60

40 Omo

20 Ace

0 Bold

-20 Minerva

-40 Campeiro

-60 Pop

-80
Invicto
-100

Copyright © 2004 INSEAD, Fontainebleau, France. Source: Unilever research

 Key Unilever Detergent Brands Worldwide
(1996)
Region Brand Price Index Region Brand Price Index
Africa Skip 100 - 115 Europe Skip 100 - 115
Omo 100 Omo 100 - 115
Surf 100 Via 100 - 115
Brilliant 100 Enka 100 - 115
Surf 85 - 100 Omo 100
Sunlight 85 - 100 Persil 85 - 100
Le Coq 85 - 100 Rinso 85 - 100
Key 60 - 85 Bio Luvil 85 - 100
Rin 60 - 85 Polenna 85 - 100
Lang 60 - 85 Bona 85 - 100
Maluwa 60 - 85 Bio Pon 85 - 100
Zamwasha 60 - 85 Surf 60 - 85
Chik 60 - 85 Sunil 60 - 85
Dambo 60 - 85 Omo 60 - 85
Asia Omo 100 Bio Presto 60 - 85
Surf 100 Radion 60 - 85
Breeze 100 Luzil 60 - 85
Rinso 100 Dero 60 - 85
Bailan 100 Latin America Skip 100 - 115
Tip 100 Omo 100
Persil 100 Rinso 100
Omo 85 - 100 Drive 100
Rin 85 - 100 Puro 100
Persil 85 - 100 Unox 100
Viso 85 - 100 Omo 85 - 100
Rinso 85 - 100 Ala 85 - 100
OK 60 - 85 Nevex 85 - 100
Sunlight 60 - 85 Marsella 85 - 100
Surf 60 - 85 Campeiro 60 - 85
Ekonomy 60 - 85 Opal 60 - 85
Fangcao 60 - 85 Rinso 60 - 85
Biomat 60 - 85 ABC 60 - 85
Oceania Drive 100 North America Wisk 100
Omo 85 - 100 Sunlight 100
Persil 85 - 100 Surf 60 - 85
Surf 60 - 85 All 60 - 85
Copyright © 2004 INSEAD, Fontainebleau, France.
 Market Share and Wholesale Price of Major
Brands in the Laundry Soap and Detergent
Powder Categories in the Northeast in 1996

Laundry Soap
Minerva
($1.7/kg)
19.1%

Bem-te-vi
($1.2/kg)
11.3%

Others
($1.2/kg) Flora
63.6% ($1.2/kg)
6.0%

Market Size: 81,000 tons ($ 102 m)

Copyright © 2004 INSEAD, Fontainebleau, France. Source: Nielsen

 Brand Knowledge, Market Penetration, and Top-
of-Mind Awareness of Major Detergent Brands in
the Northeast in 1996
Brand knowledge Market penetration Top-of-mind awareness

100%

80%

60%

40%

20%

0%
Omo Minerva Invicto Ace Campeiro Bold Pop

Copyright © 2004 INSEAD, Fontainebleau, France.

 Perceived Quality and Perceived Price of Major
Detergent Brands in the Northeast in 1996

200
Omo

Ace
Perceived quality index

Bold
Minerva

100

Campeiro

Pop

Invicto
0
0 100 200
Copyright © 2004 INSEAD, Fontainebleau, France. Price index
 Key Information for Detergent Powder in Brazil
Brand Packaging Positioning Key Brand Facts Key Data1
Cardboard Removes stains with low One of Brazil’s top brands S: 55.20
pack: 1 kg & quantity of product when across all categories. WP: 3.00
500g. used in washing Market pioneer. FC: 1.65
machines, thus reducing PKC: 0.35
Technology oriented.
the need for soap or PC: 0.35
bleach. Owned by Unilever.
4 brand extensions.5

Cardboard S: 17.60
Emotional appeal Traditional brand of Cia
pack: 1kg & WP: 2.40
(“care”). Delivers a Gessy Industrial.
500g. FC: 1.40
pleasant perfume and
Acquired by Unilever in PKC: 0.35
softness to your clothes.
1960. PC: 0.30
“New perfume:
Aphrodite’s touch in
your clothes”.
.
Cardboard Price brand. Acquired by Unilever from S: 6.05
pack: 1kg & Focus on cost reduction Henkel in 1984. WP: 1.70
500g. across all dimensions Its name evokes the FC: 0.90
valued by consumers. countryside and fields PKC: 0.35
(wave added only recently). PC: 0.20

Cardboard Offers superior Belonged to Bombril. S: 11.80

pack: 1kg & whiteness. Acquired by P&G in 1996 WP: 2.35
500g. Removes the dirt and as Quanto.
protects the fabrics.

Cardboard Key competitor of Belonged to Bombril. S: 5.35

pack: 1kg & Minerva with a similar Acquired by P&G in 1996 WP: 2.50
500g. positioning. as Odd Fases.
Focus on softness.

Copyright © 2004 INSEAD, Fontainebleau, France.

 Key Information for Detergent Powder and
Laundry Soap Brands in Brazil
Detergent Powder - cntd
Brand Packaging Positioning Key Brand Facts Key Data
Cardboard Price brand with small Belonged to Bombril. S: 1.40
pack: 1kg & sales in the Northeast. Acquired by P&G in 1996. WP: 1.70
500g. Focus on cost reduction
across all dimensions
valued by consumers.

Cardboard Entry-level detergent. Name means undefeated S: 5.20

pack: 1kg & Key competitor of
500g. Campeiro.
Focus on cost reduction
across all dimensions,
valued by consumers.
(e.g., for a football team WP: 1.70
that wins the championship
without losing one single
match). Only popular in the
Northeast. Owned by ASA.

Laundry Soap
Brand Packaging Positioning Key Brand Facts Key Data
Plastic pack Intends to leverage its S: 19.40
Traditional brand of Cia
with 5 bars of brand equity as a WP: 1.70
Gessy Industrial.
200g. detergent powder in FC: 1.00
Acquired by Unilever in
the laundry soap PKC: 0.15
1960.
market. PC: 0.25
.
Plastic pack Multi-uses (perceived The traditional laundry S: 11.45
with 5 bars of as killing bacteria) and soap brand in Brazil’s WP: 1.15
200g or single traditional and Northeast.
bar of 200g. regional values.

Copyright © 2004 INSEAD, Fontainebleau, France.

 Examples of Advertising for Laundry Soap
and Detergent Powder Brands in Brazil

Copyright © 2004 INSEAD, Fontainebleau, France.

 Examples of Advertising for Laundry Soap
and Detergent Powder Brands in Brazil

Copyright © 2004 INSEAD, Fontainebleau, France.

 Examples of Advertising for Laundry Soap
and Detergent Powder Brands in Brazil

Copyright © 2004 INSEAD, Fontainebleau, France.

 Small Retail Store in Brazil

Copyright © 2004 INSEAD, Fontainebleau, France.

 Key Differences between Generalist Wholesalers
and Specialized Distributors in Brazil
Dimension Generalist Wholesaler Specialized Distributors
Area or reach Wide Focused

Portfolio Focused on top 3 brands in All brands from a manufacturer

many categories in a few categories
Size Mid-sized / large Small

Number of SKUs Hundreds 20 to 40

distributed
Customers Supermarkets with 3 to 9 Traditional retail stores and
checkouts. supermarkets with 1 or 2
checkouts
Point-of-purchase Limited, focused on gaining Extensive.
activity (merchandising, distribution.
category management).
Ability to control price Low High
to end customer
Relationship with Opportunistic, price driven Partnership, information
manufacturer exchange
Variable cost (in stores $ 0.10 per kg. $ 0.05 per kg.
where low-income
consumers shop)
Copyright © 2004 INSEAD, Fontainebleau, France.