Realities of Emerging Markets: Some Lessons from Unilever's Strategy for Lifebuoy & Sunsilk in India

Abstract:

With the growth in the developed markets approaching saturation, consumer packaged goods (CPG) companies began looking toward developing and emerging markets for future growth. Global CPG major Unilever Plc. (Unilever) was one of the companies that had a presence in several emerging markets including India, where it operated through its subsidiary Hindustan Unilever Ltd (HUL). The case focuses on HUL's strategy for growing two mature brands with mass appeal - Lifebuoy (bath soap) and Sunsilk (shampoo), by targeting new segments in innovative ways.

In 2002, the company started a marketing program, Lifebuoy 'Swasthya Chetna'('Health Awakening'), targeting the bottom of the pyramid (BoP) segment in India. With this initiative, HUL sought to promote handwashing with soap in rural and urban areas in India. In doing so, Unilever not only helped prevent diseases like diarrhea by promoting health and hygiene awareness amongst the poor, who were infrequent users or non users of soap, but also succeeded in increasing its sales of Lifebuoy. In the process, HUL earned a lot of goodwill from consumers as well as the Government of India. In 2006, it launched a pioneering brand portal for Sunsilk, the Sunsilk Gang of Girls (GoG), targeting the increasing number of Internet-savvy girls. GoG was the first all-girl community in India and quickly caught the imagination of the target group. With India being viewed as a test market for emerging markets strategies, analysts felt that the learning from these initiatives would help Unilever develop a strong presence in other emerging markets as well.

The case tries to dispel the myth that emerging markets are only about devising strategies to target the huge BoP segment. It goes on to discuss the issues and constraints in targeting the youth in the rapidly changing scenario in India. Analysts are of the opinion that HUL's success in India was due to its ability to cater to all segments by adapting products, prices, and promotion to each of them.

Issues:

» Understand the issues and challenges faced by global companies operating in emerging markets.

» Understand the critical factors for succeeding in emerging markets by looking beyond the stereotypical image of these markets.

» Understand the issues and constraints in targeting the huge Bottom of the Pyramid (BoP) segment.

» Understand the issues and constraints in targeting the youth population in the rapidly changing scenario in India

» Understand the reasons for Unilever's success in India and discuss whether the company can leverage on this learning in other emerging markets

Contents:

Keywords:

Strategy, Emerging markets, Globalization, Base of Pyramid, BoP, Marketing leader strategy, Segmentation, Targeting, Sunsilk, Lifebuoy, Unilever, India

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