Universidade Católica Portuguesa Faculdade de Ciências Económicas Empresariais Corporate Strategy
Unilever’s ice cream brand Portfolio
Students: Maria Inês Galhardo, nº 150106011 Claudia Filipe, nº 150106026 Ricardo Lloret, nº 150106111 Joana Rodrigues dos Santos, nº 150106123 Diogo Sousa, nº 150106125
In order to draw the BCG matrix, we started by collecting some data. Based on the Datamonitor Market Report 2006 (appendix 1), we were able to calculate the total ice cream’s market value of 2008. We made the choice to do the work for the year 2008 because the present year has not already ended. Thus it was only possible to calculate estimated values for 2008. Market value: (212.8-161)/4 = 12.95 million per year 161 + (12.95*2) = 186.9 million in 2008 With the objective of studying Unilever’s principal products, we had to take into account Nestlé (Unilever’s biggest competitor). We chose one equal competitor for each group of ice creams we thought were more important (appendix 2). Among all ice creams of Unilever, we focused on the ones that had a direct competitor in Nestlé. This is why we did not choose Carte D’or or Solero, we thought that its competitors were not as obvious as the others. We assumed then that the market shares from Unilever and Nestlé were the same as in 2006 (appendix 3). These values will enable us to estimate market values for each company and afterwards to calculate market shares and values for each product. We determined the division of the market in four segments: Super premium, Premium, Regular and Economy. The segments were chosen according to a price/quality ratio for each product we took into account (Appendix 4). The different market shares for each segment were estimated assuming that the super premium products would be a market niche with a small part of the market; the premium would be the most part and regular and economy would have similar market shares but smaller. Then, we estimated also proportions for the different products we took into account. Both Unilever and Nestlé have
different market shares since we assumed that they value different products in different segments. The percentages are
Super premium 5%
The premium segment was divided in three different products with different proportions for Unilever and Nestlé. Considering that we only studied one product in some segments, we considered the whole segment share for these ones and for the regular we regarded as to have other ice creams besides Calippo that we did not include (we took them into account as “others”).
Unilever - Premium
Nestlé - Premium
Tarte Carolina 19% Nestlé 43% Extreme 38%
Trough the division of the market, we were able to attribute to each product the market share inside its own company. Splitting the different segments, we multiplied the total percentage of the segment to the share of each product inside this segment (Appendix 5). For the growth of each product, we assumed values based on the growth of each segment (Appendix 6). Finally, to calculate the relative market shares, we had to divide Unilever’s market share for each product by Nestlé’s market share for the respective competitor (Appendix 7).
Unilever Brand Portfolio:
Cornetto – It is a premium product that is present in most of the restaurants and cafés in Portugal. Cornetto is a cash cow and yours best seller and that is why we did not consider having a big growth rate. We assumed that this ice cream is already in the desired place in the market for Unilever. Therefore the investments are not very high and it has a big return. Magnum – This represents the second best product of your company, also premium and with high sales. However, it is a relatively young brand, only created in 1990, that needs a higher investment than Cornetto to establish itself in the market. Strong investments in new...
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