Unilever

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Unilever Analysis

Unilever should introduce a new, premium bar soap named Omo Luz for quality and value-conscious consumers, while lowering the price point of Minerva to reduce cannibalization and increase appeal to low to middle income segment in Northeast Brazil. In order to accomplish this mission and remain profitable, target primarily married low income women who value family and reputation; those who would otherwise buy P&G brand detergent or a local brand. This new Omo product will be the best performing bar soap on the market, combining the familiarity of bar soap, the lack of residue and power of Omo detergent powder and the fragrant foaming experience that connote cleanliness, family love and pride. Background information

Context – The Government stimulus program, Plano Real, has been a driver of the change in Brazil. The effects of improving the purchasing power of the poorest 10% of the population citizens and controlling inflation have primed Brazil for growth. However, macro-issues such as the cycles of economic stress and recovery, illiteracy and societal dependence on the business of agriculture are key market-expanding considerations for Unilever. Customers – 48MM people live in the NE. Women typically do the laundry in this region, and do so with pride and with a much greater frequency than in other parts of the country. The NE population has the lowest GDP per capita of any region in Brazil, despite increased purchasing power due to government aid. The consumers in the NE also tended to use more laundry soap than detergent powder as it is a much cheaper product. Competition – Proctor & Gamble (P&G) is the only other major player in the detergent market, and hold 15% of the market compared to Unilever’s 81%. Though P&G does not offer a laundry soap product, the company is a key competitor because of their sheer size and marketing prowess. In the laundry soap market, Unilever’s Minerva brand competes only with local Brazilian companies...
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