A Marketing Essay (Essay Sample)

A MARKETING ESSAY
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A Marketing Essay
Different companies employ different market methodologies to reach the consumers all over the world. Unilever is a multinational company that deal with consumer goods and founded in 1930 (Robles, Françoise, & Haar 2003, p.121). Its products range from beverages, foods, personal care products, and cleaning agents in over 100 nations worldwide. It was measured to be the world third largest consumer goods company, after Nestle and Procter & Gamble and the world largest ice cream manufacturer. It is divided into three major segments in the world including Personal care, Home care, and Food divisions. It has over four hundred brand, but 25 of the largest brands make over seventy percent of all sales. Some of the largest brands of the Unilever include Axe/Lynx, Dove, Aviance, Ben & Jerry’s, Heartbrand, Omo/Surf, Sunsilk, VO5, Wall’s, PG Tips, TRESemme, and Rexona/Sure among others (Ma'arif 2011, p.49).
Unilever have a market capitalization of 27.3 billion pounds as at 31 December 2011.It is also listed in the London stock exchange and is the 18th largest company in share trading. The company have undergone restructuring and reengineering since it was formed, absorbing companies like Slim Fast, Ben & Jerry’s and Best food among others, whiles selling out some of its products like Karo and Mazola to other companies (Lamb, Hair and McDaniel 2007, p.90). It has also introduced new brand and terminated some in the bid to increase the international market share. There are 14 ‘billion-Euro brands’ which Unilever focuses resources on, since each of these products has an excess of a billion euro annual sales.
Unilever has enjoyed product superior quality, and differentiation it is number one in provision of savoury, dressings, ice cream, deodorants, spreads, tea, and mass skin. It is world number two in laundry products and daily hair care, while having local strength in oral care products and household cleaning. Every product is different and is marketed and sold as a unique entity and these is more to the 14 biggest products in the company profile. Price has been one of the unique selling prepositions for the company. Unilever have continuously offered products at a cheaper and pocket friendly price to the consumers in the market it operates. Unique selling point is also tailored to each product advertising to create a reason to buy a given product. Example is in the Unilever’s Dove, Degree antiperspirant, and in the Axe advertising among others (Russell 2010, p.51). Dove brands for example, encourage mothers to protect their girls the unrealistic expectations from the beauty industry and portray itself as ‘Real Beauty’. Axe use an advert of an average man being swarmed by 48 models due to the use of Axe body wash. The Degree antiperspirant uses TV advert ‘Degree Road o the Ironman’ to create the brand’s ‘never say die’ personality. These are some of the individual product unique selling point strategies which differentiate the brands and the company in the market. There are unique selling point to the whole company, like the price, and individual product unique selling point, like the brand image of being the leader in beauty.
Unilever operate in a market with intense competition from both large multinational corporations like Procter & Gamble, and from local small scale firms. To survive in the dynamic global economies, Unilever has to develop marketing methodologies that will give it a competitive edge over its rivals. Unilever has many markets, many niches and so many touches, becoming difficult to please every customer across the globe. It therefore requires proper planning on market segmentation and market strategy in reaching out its diverse market. The company products get used over 2 billion times by over 150 million people all over the world, and these is just an indication of how complex the market is for the company (Brookes and Palmer 2003, p.80). Unilever marketing strategy, which is a combination of three pillars, is ‘Crafting brand for life’. The three strategy pillars include people first pillar, magical experiences, and indispensable brand pillar. The market strategy put people at heart and is not only shoppers and customers, but all persons. Unilever also try to create brands with a clear point of vie and purpose, that people cannot live without. In its brand strategy, Unilever try to unlock the special or magical experiences with each of the company’s brands.
Unilever had 7000 brand partners and marketers all over the world by November 2013, and had collaborated with many entities in strategy development, while being the world second largest advertiser. In December 2013, Unilever announced that it would cut its sales and marketing workforce by 12% or 800 workers (Doole and Lowe 2013, p.72). This was prompted by the fall of top-line growth of consumer goods, below its rival and competitor Proctor & Gamble growth. This was caused by increased competition and slowdown in developed market segments. Unilever announced cost cutting measures to improve efficiency and position the company in a competitive position. The changes will also see cuts in brand ranges, agency partners and people. The planned cut is decreasing the numbers of SKUs and product varieties by 30% by the year 2014.The company also announced the reduction in non-media advertising costs from 32% to 20% (Dibb 2012, p.32).The marketing team in the company plan to market directly in large countries, instead of using regional hubs.
Unilever has been involved in recent controversial ads like Pot Noodle ad, Lynx, and Marmite TV campaign. These adverts were criticized to have elements of promoting racial stereotypes and women objectification in case of Lynx ad, degrading and crass in case of Pot Noodle ad and degrading in case of Marmite TV campaign. The market segment for the company is diverse and spread across different races, religions, sex, and tastes and preferences. The company have to be sensitive on what it put in the ads to avoid offending some people.
Bird and McEwan (p.9) outline the process which leads to the formation of Unilever Marketing Council, which is responsible for market activities in the company. The Council have the responsibility of making all the decisions on behalf of the various departing in the company n the marketing matters. The Council liaise with marketers in the company to ensure marketing agendas are aligned with business priorities. Coming up with a marketing strategy is a responsibility of the council.
Marketing strategy in Unilever is based on the three pillars as discussed above. Market segmentation involves division of the target market into distinct group based on characteristics, needs, and behaviour which are distinct and might necessitate separate products or different market mix. It can range from geographical, lifestyle, personality, and demographical among others factors. Unilever Australasia use individual branding as a method of creating market segmentation. Each product is named and promoted individually and these have created segmented market in term of products and users in are of personal care, food, homecare, and others. Individual product branding would protect other product images in case of the inferior product introduction.
When a company want to enter many segments of the same market, individual branding also help in the strategy. Unilever offer food brands targeted at different market segments. As noted by Ferrell, Lukas, Schembri and Niininen (p. 3), Flora pro-activ margarine targets the consumers with high cholesterol levels, while brand like Lanchoo target Australian consumers with preference to high quality leaf tea. Bushells target the Australians with authentic and traditional feel to the tea. Unilever has also created very efficient market segmentation in offering of Rin, Wheel, and Surf. The segmentation has been very perfect that, the three products have never eaten into each others market share (Bird and McEwan 2011, p.33). The company has gained a competitive advantage over segmentation in the market. The company has a price model for every market and segment. Products like Aqua is a trendy product targeted for the youths, Raga was targeted for sophisticated Indian woman, Dash targeted for the kids and Sonata was a product targeted for the budget-conscious consumers. Unilever Pakistan Ltd has segmented its market on geographic areas. The market segment is into the urban, rural and sub-urban area target markets.
Unilever brand portfolio is made up of 35% Savoury, dressings and spreads, 28% personal care products, 19% ice cream and beverages, and 18% of the portfolio is made up of home care products (Gugenheimer 2006, p.230). The company get about 57% of the sales from the emerging markets, and the slowdown in these regions towards the end of 2013, caused the weaker sales to the company. The main competitor of Unilever is Proctor & Gamble which have an international turnover of 83.7 billion dollars as compared to 66.7 billion dollars Unilever turnover. The large amount of Unilever sales, 55%, comes from the emerging markets, while 62% of Proctor & Gamble sales come from the developed market.
Emerging markets offers the greatest promises to the Unilever market future. Emerging economies such as India, China, Africa and other Asian offer the greatest promise to increased market share, since they have in recent past, shown stability in growth, despite the world economy woes. Unilever sales mix give it an edge over its rival Proctor & Gamble, and these promises better chances for Unilever (Srinivasan 2008, p.82). Unilever market share stands at 55% in the emerging markets, comp...