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Unilever & Diversification Strategy
Tutor: Mr. Nguyen Dang Hoang Tut:
1BA08
Grou Gr oup: p: Ng Nguy uyen en Ho Hoan ang g Ph Phuo uong ng
5/25/2011
0804 08 0400 0000 0081 81
Truong Th Thi Thuy Dung
0804000020
Le Thi Huong Lien
0804000054
Nguyen Thi Huong
0804000049
Nguyen Thi My Ha
0804000033 1
C ontents ontents Introduction Implementing Strategy Achievements Difficulties in Implementing Implementing Reactions of Rivals Predictions
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I ntroduction Headquarter:
Unilever N.V. in Rotterdam, & Netherlands and
Unilever PLC in London, United Kingdom
Founded in 1930
Brands: Food, Home care, Personal care, Nutrition, Health &
beauty
Revenue: ¼44,262 billion (2010)
Net income: ¼4,598 billion (2010)
W ebsite: http://unilever.com
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I ntroduction
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Im plementing
Strategy
Related diversification through acquisitions & strategic partnership
Strategic fits exist in the value chain of
Supply chain activities
Sales & marketing activities
Manufacturing & distribution activities
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Im plementing
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Strategy
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Im plementing Rationales -Build
strong portfolio
( In 2000) -Strengthen
Inmarko (
2nd
April 2008)
Unilever's position as the world's number one ice cream business -Strengthen
Unilever's portfolio and competitive position in Russia, one of its priority countries Build strong position of hair
(
April 2009)
care products
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-History
of growth in revenues and earning
20.3 billion euro
cash; assumption of net debt
-The
leading ice cream company in Russia Strong brand and product portfolio with clear market leadership -
An undisclosed amount
- An
extensive supply chain network global professional hair product business ¼411.5 million -Turnover in
2008 was
$250million
Alberto Culver Company Complementary Unilever¶s ( 17th December 2010)
global position
U contributions
-The
TIGI 2nd
Attractive drivers -Strong
Bestfood
strategy
existing portfolio of iconic brand (Dove, Pond¶s« )
Manufactures, distributes and markets leading hair
-$3.7
billion cash
care brands 7
Im plementing
Strategy
Brings the brand, world-class
knowledge of tea
Unilever
Its research and development capability to the product
Lipton
E
Pepsico
xtensive bottling
Distribution network with strong customer relations
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Achievements
Financial achievements
2008, Inmarko: a turnover in 2008 of approximately ¼115 million
2009,TIGI: turnover of the business worldwide in 2009 was around US
$250 million.
2010, acquired Sara Lee Corporation & Albert Culver: turnover 44. 3
billion Euro; profit 6.3 billion Euro
Strategic achievements
10th largest U>S based food products company
The
Increasing market share: from emerging markets is 53%(2010)
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global professional hair product business
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Achievements
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Difficulties Increasing cost and time for re-launching a brand Advertising and promotional
expenditure
Switching capacity between formats would be difficult
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Stock
price decrease after announcing acquisition 1760 1740 1720 1700 1680 1660 1640
Series1
1620
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Difficulties Integration
process and management
problem -
Rapid change in organization structure
-
Eliminating EXP:
overlap product lines
Unilever and Alberto Culver have a lot of common
product such as personal care product categories (haircare, hairstyling, skin cleaning«)
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R eactions
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of R ivals
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R eactions 1.
P&G: related diversified company in the consumer goods industry
Five
main business segments:
-
Fabric and Home Care: Tide, Cascade
-
Baby, Feminine and Family Care: Bounty
-
Beauty Care: Cover Girl,
- Health -
of R ivals
Head
& Shoulders
Care: Crest
Food and Beverage: Folgers Coffee
Transforming leading brands: Tide, Ariel and Pampers global powerhouses.
Attracting customers in North America, Latin and W estern+ penetrating Asia, Central and Eastern Europe and China.
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R eactions
of R ivals
Acquisitions:
2001: Yohji Yamamoto, Parfums Lacoste, Parfums Jean Patou.
2003: Hair Care Company: W ella.
2005 : the razor and battery maker Gillette Co. at $57 billion, create
revenues > $60 billion surpass Unilever (rev:53bil )
2010 :Natural Pet Products - pet food business
Partnerships: W al-Mart, Carrefour, Tesco and Metro.
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R eactions
of R ivals
2. Colgate ±Palmolive: American diversified Multinational
Corporation Focusing:
Oral care: Colgate total toothpaste, Colgate max fresh
Personal care: soft soap, speed stick
Home
Pet nutrition: Hill¶s Diet
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care: Palmolive, Murphy oil soap
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R eactions
of R ivals
Acquisition: 2004: GAB A Holding AG- European oral care company at$ 866mil
the European toothpaste market to 33 percent. 2011, acquired Sanex From Unilever at $ 940mil
Strategic
partnership
Nestle(2003)
IBM(2006)
The
:
Pan American Health Organization (2010)
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Unilever¶s SWOT Strength
Recognized as global brand - Strong brand portfolio - Diversified management structure across the globe - Supply chain excellent -
Opportunity
Globalization and urbanization Liberalizations of economizes and trade agreements Good grow potential in the Health and Beauty segment Internal grow initiative
Weakness
Decreasing sale and revenue - Competition among brands - High cost of product -
Threat High
lever of competitions New entrants Foreign currency exchange fluctuations Potential failure of internal grow initiative
Prediction
Be loyal to its diversification strategy
Aggressively ->
to consolidate markets and enhance its market position.
Exploit
pursue acquisitions
and expand its global presence
Focus more on recruiting talent people
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Prediction Seek
to reduce cost of production through
Move productions to developing countries
Seek opportunities to outsource
New technology to increase the efficiency of productions
Use bargaining power to obtain materials at lower price
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R eferences
Project Planning for the Migration of Technology in Business Mergers [Online]. Available: http://www.itrelo.net /facilities-it-technology-telecommunications-project-managementinformation%20technology/mergers-acquisitions -and- joint-ventures.htm [ Accessed May 3 2011]. U nilever's path to growth strategy [Online]. Available: http://www.scribd.com/doc/2074712/Unilever -Strategy [ Accessed May 4 2011]. BW PORT AL.COM. U n ilever và hành trình i mi sn phm [Online]. Available: http://www.phattrienthuonghieu.com/unilever -va-hanh-trinh-doi-moi-san-pham/ [ Accessed May 3 2011]. CULVER, A. 2010. Acquisitions & disposals [Online]. Available: http://www.unilever.com/investorrelations/understanding_unilever /acquisitionsanddisposals/ [ Accessed May 3 2011]. GADISH, O. 2009. U nilever a Case Study: Toward a Coherent Corporate Identity [Online]. Available: https://learningspaces.njit.edu/elliot/content/unilever -case-study-toward-coherent-corporate-identity [ Accessed Apr 30 2011]. GAMBLE, P. 2010. P&G Acquires Natura Pet Products P&G Expands Further in 'Super Premium' Pet Food Segment [Online]. Available: http://www.pginvestor.com/phoenix.zhtml?c=104574&p=irol-newsArticle&ID=1422726 [ Accessed May 5 2011]. JONES, G. 2005. U nilever: Transformation and Tradition [Online]. Available: http://hbswk.hbs.edu/item/5112.html [ Accessed Apr 28 2011]. KI81, N. T. N. A. T. 2009. bai thuyet trinh marketing [Online]. Available: http://www.yousecond.com/DAB/blog/16108/ [ Accessed Apr 29 2011]. ORGANIZATION, P. A. H. 2010. P AHO Partners with Colgate-Palmolive to Advance Oral H ealth in Latin America and the Cari bbean [Online]. Available: http://www.pharmpro.com/News/Feeds/2010/06/agencies-andorganizations-pan-american-health-organization-paho-partners-with-colgate-palmolive-to-advance-or / [ Accessed Apr 29 2011]. REUTERS, T. 2011. EPS consensus progress over the last 18 months [Online]. Available: http://www.4traders.com/UNILEVER-6290/consensus-revisions/ [ Accessed Apr 27 2011]. TIMU, A. 2010. P&G Won¶t Counter U nilever Bid for Al berto-Culver, Chief Says [Online]. Available: http://www.businessweek.com/news/2010-09-29/p-g-won-t-counter -unilever -bid-for -alberto-culver -chief -says.html [ Accessed May 1 2011].
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