unilever 2010 investor seminar winning in d&e markets ... · unilever 2010 investor seminar...

Unilever 2010 Investor Seminar

Winning in D&E Markets

Harish Manwani

Agenda

D&E Opportunity & Trends

Unilever in D&E

D&E Ambition

D&E – Where we will play

How we will win

Summary2

Source: Unilever Estimates from Globegro

D&E

DEV

94% 72%

750 million $ 23 Trillion

Share of population growth

Share of incremental consumer expenditure

D&E : Big opportunity

DEVELOPEDD&E

3

Most 100M+ population countries will be in D&E(13 out of 15 by 2020)

US

Japan

Mexico

Brazil

Vietnam

Indonesia

India

Philippines

Russia

ChinaPakistan

Bangladesh

EthiopiaNigeria

Egypt

4Source: Unilever Estimates from Globegro

China

Emerging Asia will be the largest market by 2020

Consumer Spending 2020 ($ tn @ PPP exchange rates)

Source: Unilever Estimates from Globegro

NA - $15.2

WE- $9.6

SA - $5.6

ANZ & NEA- $4.3

AMET - $6.5

CEE- $4.4

ASIA (ex ANZ & NEA) - $19.8

5

D&E : Emerging trends

6

The New Rich: Opportunity to lead premiumisation

7

New Professional Women: Beauty and convenience

8

Rapid urbanisation leading to rise in hygiene concerns

9

Functionality with less water

10

Source : BCG 2010 Internet Report

BRICI from 600 million to 1.2 billionby 2015

3 x of USA & Japan

BRICI from 1. 8 billion to 3 billionby 2015

4 x of USA &Japan

Digitisation: D&E will leapfrog in connectivity

MOBILE INTERNET

11

http://www.youtube.com/watch?v=s8O-hv3w-MU

Waste

Sustainable sourcing

Water

Greenhouse emissions

D&E: Sustainability will become license to operate

12

Sustainable Palm Oil

Rainforest alliance

Empowering Women

Hygiene for all

Access to Clean Water

Less Water

Sustainability - Unilever leads the agenda in D&E

13

http://www.unileverlibrary.com/Volumes/xraid1/sites/ul Unilever/agency/public/images/Corporate responsibility/Communities/Health & hygiene/bhakti0022.jpg

Source: SES Report

New Professional Women

The New Rich

Hygienefor Urban

Functionalitywith lessWater

Emerging consumer groups Need for functionality

RapidDigitisation

Connectivity

Sustainability

D&E : Emerging trends

14

Agenda


Unilever in D&E

D&E Ambition


How we will win

Summary15

D&E: Consistent growth with 9% CAGR

52%of Unilever

20% of Unilever

9% CAGR

1990 2010

16

17

2006 2007 2008 2009

Turnover (€bn)

UVG

D&E: Recent volume led acceleration

10% CAGR

6.6%

Q3'09 YTD Q3'10 YTD

10.4 %

4.4%

At constant 2009 average rates.

D&E: Profitable growth

D&E D&E excl. Russia and China

Unilever average

Underlying operating margin% 2009

18At constant 2009 average rates.

We have the best footprint in D&E

52%

15% 25% 35% 45% 55%

Source: Annual Report & Accounts, analysts estimates, Unilever estimates

19

http://images.google.co.uk/imgres?imgurl=http://www.enjoyfrance.com/images/stories/france/news/logo_l_oreal.jpg&imgrefurl=http://www.enjoyfrance.com/content/view/1253/36/&usg=__L4B2g_snkLl0O0EK3oUACsD1RQ4=&h=472&w=2008&sz=75&hl=en&start=1&itbs=1&tbnid=JgekR3nM68kRRM:&tbnh=35&tbnw=150&prev=/images?q=L'OReal&hl=en&gbv=2&tbs=isch:1

http://images.google.co.uk/imgres?imgurl=http://www.alseer.com/media-files/2008/03/30/20080330_colgate-logo.JPG&imgrefurl=http://www.alseer.com/en/companies/agencies-trading.html&usg=__59-IbPU64JDT4Ni1zzkKP5uZp30=&h=150&w=150&sz=3&hl=en&start=12&itbs=1&tbnid=C1pCD0zYLFAo3M:&tbnh=96&tbnw=96&prev=/images?q=Colgate+logo&hl=en&gbv=2&tbs=isch:1

http://images.google.co.uk/imgres?imgurl=http://www.ukspa.org.uk/ContentImages/Science-Park-Images/Logos/ReckittBenckiser09-logo.jpg&imgrefurl=http://www.ukspa.org.uk/science_parks/content/1107/reckit_benckiser&usg=__mQ7eBZf_ic2lWQE0W3hYo74_gGg=&h=100&w=225&sz=19&hl=en&start=7&itbs=1&tbnid=zFfGDkv6UeARQM:&tbnh=48&tbnw=108&prev=/images?q=reckitt+logo&hl=en&gbv=2&tbs=isch:1

http://images.google.co.uk/imgres?imgurl=http://bloomdesign.typepad.com/.a/6a00e54ef40d5a883301116897b76a970c-800wi&imgrefurl=http://bloomdesign.typepad.com/blooms_blog/communications/&usg=__kH6n5otRoqHqQp636yyFqC_lnUE=&h=419&w=700&sz=34&hl=en&start=1&itbs=1&tbnid=ZS2zYBPo7w4rqM:&tbnh=84&tbnw=140&prev=/images?q=danone+logo&hl=en&gbv=2&tbs=isch:1

http://images.google.co.uk/imgres?imgurl=http://www.tangram.co.uk/images/BWR - Nestle - Logo.gif&imgrefurl=http://www.tangram.co.uk/TI-BWR-01.html&usg=__PCO5fsawN8dUt3EvkjsPKIUqQMQ=&h=335&w=800&sz=12&hl=en&start=3&itbs=1&tbnid=G9ZzdVoG14PkJM:&tbnh=60&tbnw=143&prev=/images?q=nestle+logo&hl=en&gbv=2&tbs=isch:1

We compete effectively both with international and local competitors

Source: Nielsen/IRI MAT (only for markets/categories UL competes & tracks), Competitor Intelligence analysis

OtherMultinationals

34%

Unilever30%

Local36%

20

BangladeshVietnamIndia Indonesia Thailand PhilippinesChina

Fabric Cleaning

Hair Care

Face Care

Skin Cleansing

Deos

Tea

Savoury

Ice Cream

Market leadership

across categories and countries in D&E

Brazil Russia

1

1

1

1

1

1

1 1

1

1

1

1

1

1

1

1

1

1

1

1

1

1

1

1

1

1 1

1

1

1

1 1 1

2 2

2

2

2

2

2

2

1

2

21

1

1

1

Argentina

1

1

1

1

1

2

1

1

1

1

1

2

Pakistan

2

1

1

Source: Nielsen / IRI / Unilever Estimates 21

2

http://www.google.co.uk/imgres?imgurl=http://www.enchantedlearning.com/southamerica/brazil/flag/Flagbig.GIF&imgrefurl=http://www.enchantedlearning.com/southamerica/brazil/flag/&usg=__WSNCwu_bhqMAiiBOO18peIzy08M=&h=313&w=426&sz=6&hl=en&start=4&zoom=1&tbnid=JTlg9vQ0V2nnkM:&tbnh=93&tbnw=126&prev=/images?q=Flag+of+Brazil&hl=en&gbv=2&tbs=isch:1&itbs=1

http://www.google.co.uk/imgres?imgurl=http://www.footballpictures.net/data/media/147/russia-flag.jpg&imgrefurl=http://www.footballpictures.net/details.php?image_id=1341&usg=__i03KRIgYMeeiNmNUzQO-4VlLT2o=&h=768&w=1024&sz=30&hl=en&start=4&zoom=1&tbnid=bqquuVUhHnmKSM:&tbnh=113&tbnw=150&prev=/images?q=Flag+of+Russia&hl=en&sa=G&gbv=2&tbs=isch:1&itbs=1

http://www.google.co.uk/imgres?imgurl=http://wikieducator.org/images/thumb/4/41/Flag_of_India.svg/800px-Flag_of_India.svg.png&imgrefurl=http://wikieducator.org/File:Flag_of_India.svg&usg=__jf-_sM2FL0m-Z0Tec9dd77pGKmE=&h=533&w=800&sz=27&hl=en&start=3&zoom=1&tbnid=YRJspSE-Wxx2lM:&tbnh=95&tbnw=143&prev=/images?q=Flag+of+India&hl=en&gbv=2&tbs=isch:1&itbs=1

http://www.google.co.uk/imgres?imgurl=http://www.flag-zone.com/img/china/flag.gif&imgrefurl=http://www.flag-zone.com/flag/china/&usg=__P7VSVhTwH_Krsl_PEu7O02h-rxA=&h=302&w=453&sz=3&hl=en&start=1&zoom=1&tbnid=H77Ns8LoQSpQzM:&tbnh=85&tbnw=127&prev=/images?q=Flag+of+China&hl=en&gbv=2&tbs=isch:1&itbs=1

http://www.google.co.uk/imgres?imgurl=http://www.clker.com/cliparts/3/e/b/8/1206567153268174852Anonymous_flag_of_Indonesia.svg.hi.png&imgrefurl=http://www.clker.com/clipart-flag-of-indonesia.html&usg=__8t4-ZBA1ZAEZS2BcZTlZYxcfMy4=&h=451&w=600&sz=3&hl=en&start=3&zoom=1&tbnid=gGD52LMPGWDS1M:&tbnh=101&tbnw=135&prev=/images?q=Flag+of+Indonesia&hl=en&gbv=2&tbs=isch:1&itbs=1

http://www.google.co.uk/imgres?imgurl=http://www.thaitourism.com.my/images/600px-Flag_of_Thailand.svg.png&imgrefurl=http://www.thaitourism.com.my/regions.php&usg=__eWsOmnyLv7Q-yQVgJJA9yNqa5Uk=&h=400&w=600&sz=2&hl=en&start=2&zoom=1&tbnid=2DRb4RhFP1elxM:&tbnh=90&tbnw=135&prev=/images?q=Flag+of+Thailand&hl=en&gbv=2&tbs=isch:1&itbs=1

http://www.google.co.uk/imgres?imgurl=http://wikieducator.org/images/thumb/0/05/Flag_of_Philippines.svg/800px-Flag_of_Philippines.svg.png&imgrefurl=http://wikieducator.org/File:Flag_of_Philippines.svg&usg=__94Jilv_ztbdfHtTw8_qtWPxJiqo=&h=400&w=800&sz=23&hl=en&start=3&zoom=1&tbnid=_LssgGou3fxm6M:&tbnh=72&tbnw=143&prev=/images?q=flag+of+philippines&hl=en&gbv=2&tbs=isch:1&itbs=1

http://www.google.co.uk/imgres?imgurl=http://unimaps.com/flags-asia/vietnam-flag.gif&imgrefurl=http://unimaps.com/flags-asia/vietnam-print2.html&usg=__SWrDpQVKfNuLk7V_kjfyMR9Hs6M=&h=600&w=900&sz=6&hl=en&start=3&zoom=1&tbnid=CpfjPrL7_m2kPM:&tbnh=97&tbnw=146&prev=/images?q=flag+of+Vietnam&hl=en&gbv=2&tbs=isch:1&itbs=1

http://www.google.co.uk/imgres?imgurl=http://mapsget.com/flags/asia/bg-lgflag.gif&imgrefurl=http://mapsget.com/asia/bangladesh/flag-of-bangladesh/&usg=__z0uJ5n7FET0AUmtvME-5rY-2GUU=&h=302&w=503&sz=3&hl=en&start=3&zoom=1&tbnid=EJwUbS3J1W_9VM:&tbnh=78&tbnw=130&prev=/images?q=flag+of+Bangladesh&hl=en&gbv=2&tbs=isch:1&itbs=1

40%

% TO

Emerging Asia

Both charts represent contribution to D&E Turnover 2009

D&E: We are big in HPC and big in Asia

27%

37%

35%

% TO

HC PC Foods

22

2006 2007 2008 2009

At 2009 average rates.

13% CAGR

Turnover

Emerging Asia: Consistent growth, above D&E average

23

CAGR: 2007-2009, market growth based on Nielsen/IRI/Unilever estimates

Volume Value

Emerging Asia: We are growing competitively

Market USGMarketUVG

12.1%

12.8%

3.2%

6.6%

…. and fit to compete

Fabric cleaningIndia

Fabric cleaningThailand

>100bps

18%

7%

>100bps

Source: Q3 Unilever internal data and Nielsen.

HairIndia

>60bps

20%

25

…. and fit to challenge

Fabric cleaning - China

0

5

10

15

20

25

30

APR 07 OCT 07 APR 08 OCT 08 APR 09 OCT 09 APR 10

Value share (%)

Major competitor

1560bps230bps

1560bps1560bps230bps230bps

25.5

18.2

25.5

18.2

9.9

15.9

9.9

15.9

SEP 10

Source: Nielsen.

26

Agenda


Unilever in D&E

D&E Ambition


How we will win

Summary27

50%70%

Unilever Ambition : Accelerate D&E

28

Agenda


Unilever in D&E

D&E Ambition


How we will win

Summary29

small

large

largesize of consumer expenditure in 2010(PPP exchange rates)

gro

wth

o

f co

nsu

mer

exp

en

dit

ure

2010-2

0

China

India

next 13BRIC bubble size refers to 2020 population

Nascent market cluster ( Central Africa + Central Asia )

Brazil

Russia

Mexico

Indonesia

Turkey

Argentina

Poland

South Africa

PhilippinesThailand

Pakistan

Egypt

Vietnam

Nascent markets

Bangladesh

Nigeria

D&E Key Markets: Follow the money and people

Source: Unilever Estimates from Globegro30

small

large

large

BRIC

STRONGHOLDS

NASCENT

IndiaBrazil

Russia China

Mexico

Poland

Turkey

Nigeria

Egypt

IndonesiaThailandPakistan

Philippines

Vietnam

Bangladesh South Africa

Argentina

market size 2009

mark

et

share

bubble size refers to current turnover

D&E: Unilever in key markets

31

Unilever: BRIC Turnover

2005 2006 2007 2008 2009

10% CAGR

At 2009 average rates.

Brazil + India

China + Russia

32

RUSSIACHINA

Turnover Turnover

2005 2009 2005 2009

22% p.a.19% p.a.

* CAGR 2005 - 09 based on total TO, not adjusted for acquisitions

Build rapid scale in China & Russia

33

2005-2009 : CAGR 11%

Strongholds: Lead Full Portfolio Deployment

Source: Nielsen/IRI/Unilever estimatesStrong Other

Un

ileve

r %

of

bu

sin

ess

34

Source: Unilever internal data, based on 15 countries in D&E

160 brand roll out opportunities

size of prize €2bn

Opportunity for brand portfolio deployment

0%

20%

40%

60%

80%

100%

Do

ve

Re

xo

na

Cle

ar

Kn

orr

Wo

rld

Lip

ton

In

tern

ati

on

al

Lu

x

Sun

silk

Sig

na

l

Clo

se u

p

Dir

t Is

Go

od

Ax

e

Po

nd

s

He

art

Do

me

sto

s

Ra

dia

nt

Lif

eb

uo

y

Sun

ligh

t H

HC

Co

mfo

rt

Fam

ily

Go

od

ne

ss Cif

He

ath

ly H

ea

rt

Surf

Imp

uls

e

TIG

I

% Brand Presence

160 brand roll out opportunities - size of prize €2 bn

brand presence %

Present

D&E Brand Presence %

Not present

35

Brands into white spaces: Recent launches

Axe - Bangladesh

Cif – Asia Sure - India

Fruttare - Thailand

Clear – Asia & AMET

Dove - China36

Be Everywhere … 700 Million consumers

Potential €1.5 bn opportunity

Nascent Markets: Accelerate geography fill

Source: Unilever internal estimates

37

Summary : Key jobs to be done in D&E

Sustain strong leadership positions in India and Brazil

Build rapid scale in China and Russia

Lead full portfolio deployment in all strongholds

Accelerate geography fill in nascent markets

38

Agenda


Unilever in D&E

D&E Ambition


How we will win

Summary39

marketdevelopment

70-80%

marketshare gain

10-20%

whitespace

10% +

Sources of Growth

40

‘Straddle the pyramid’ in key categories

Accelerate personal care everywhere

Building competitive advantage

41

At the bottom

Laundry – India

At the top

Masstige Beauty

“Straddle the pyramid“

42

Strong Innovations

Unlock the full potentialof Personal Care

opportunity

Shopper Experience

ConsumerConnect

PC Culture

Accelerate Personal Care Everywhere

43



Lead market development


44

Have lots

Haves

Have nots

billions of people

0.9

2.0

2.9

2.0

2.7

1.9

More benefits

More usage

More users

2010 2020

Source: Unilever estimates Globegro, updated upon LSM 2.0 baseline studies.

D&E : Huge market development opportunity

45

Big opportunity for more users

serving 1.8 billion consumers

but 5.8 billion already by 2010

46

Market Development OpportunitySignificant upside in consumption

1.9 1.93.9

15.7

19.923.4

India Indonesia China Brazil Germany USA

Detergents

0.51.6 2.3

6.6

9.811.3

India Indonesia China USA Brazil Germany

Shampoos

0.4 1.5 3.312.2

46.1 49.8

India Indonesia China Brazil USA Germany

Ice Cream

0.6 2.06.6

21.3

32.0

55.4

India Indonesia China Brazil USA Germany

Skin Care

Per Capita Consumption (US $ ) | 2010

47Source: Euromonitor

Our unique basket of categories can reach most of the D&E world

Super premium Ice Cream

Machine dishwash

Deodorants

Personal wash liquid

Ice Cream OOH

Fabric solution wash

Shampoo

Toothpaste & Toothbrushes

Bar soap

Small surface cleaners powder

Population Reach

6 bn

3.9bn

1.8bn

0.9bn

2.4bn

Source: Unilever Estimates

0 5000 10000 15000 20000 25000

GDP / capita $

$350

48

More Users

More Usage

More Benefits

10 Step Market Development Wheel

49

Our repeatable model

The “5 Peso” starter packs - Philippines

50

Deodorants Latin America

538

3,100

1997 today

Market size€m

Source: Euromonitor

20092001

1,200

3,500

51

Relative marketshare

2.8 3.4




Be an execution powerhouse


52

D&E markets: How our customers rank us

#1

#1

#1 #1

#1

#1

#1

#2

#2

#2

#3

Source: AC Nielsen Customer eQ Surveys

#4#1

#3

53

OUTLET UNIVERSE IN D&E: 20 M

4.3 M

OUTLETS WHERE UNILEVER PRODUCTS

ARE DISTRIBUTED: 10.5 M

OPPORTUNITY

INFLUENCED

DIRECT

Be an execution powerhouseMore stores…better stores…better served

54

from 1 million (2010) to 5 million (2020)

GT MT

More stores… better stores… better served

“Perfect Stores”: D&E ambition

55

Investing in Customer Insight & Innovation CentresChina, India, Singapore

56

Bushfire – 28 markets; over 10,000 employees

57





Deploy low cost business models


58

FROM

TO

Cost + Margin = Price

Price + Target Margin = Target Cost

Deploy low-cost business models:Reverse engineering approach

59

125 33 92

From

To

Cost

TargetCost

GrossProfit

Price

TargetPrice

TargetGP

117 33 150

Deploy Low Cost Model : Deodorants India

60






Employer of choice


61

1

2

1

4

Indonesia

Turkey

Brazil

Russia

India

China

Mexico

Pakistan

Argentina

Chile

South Africa

1

1

1

1

1

1

1

Employer Brand FMCG Ranking

Employer of choice – continue to build

Vietnam 1Source : Country surveys 62

World class talent development“Four Acres” Singapore

63






Employer of choice

Locally relevant, globally efficient organisation


64

Build global capabilities in

D&E

Outstanding local insights

Scale-up innovation

resources in D&E

60% +


65

Global innovations with local insights

Knorr Jelly Bullion - ChinaRexona Deo Lotions - Indonesia

Knorr Soupy Noodles - India Ponds – Asia 66

Focusing Innovation Resources in D&E

BANGALORE

SHANGHAI

BANGKOK

ISTANBUL

DURBAN

SAO PAULO

MEXICO CITY

BUENOS ARIES

INNOVATION CENTRES

GLOBAL R&D CENTRES

MUMBAI

42% of R&D

50% of Brand Development

DUBAI

67






Employer of choice



68

Agenda


Unilever in D&E

D&E Ambition


How we will win

Summary69

Winning in D&E markets - Summary

D&E is a huge opportunity

We are strong and fit to compete.

Our ambition is to consistently outpace market growth

Lead market development and

Grow share steadily

Key actions:

BRICs are a must win; Build rapid scale in China and Russia

Deploy full portfolio in Strongholds; early mover in nascent markets

Accelerate Personal Care everywhere


Substantially scale-up innovation and leadership capabilities in D&E

70

0%

20%

40%

60%

80%

100%

1946 1956 1966 1976 1986 1998 2004 2008 2009 2015 2020

D&E: 70% of Unilever

71

Developed Markets

D&E Markets

unilever 2010 investor seminar winning in d&e markets ... · unilever 2010 investor seminar...

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