Growth is an important factor for nearly every company that wants to be successful in the future. For that reason, Unilever has conducted market research concerning growth opportunities in the low-end detergent market in Northeastern Brazil. This report will deal with the issue of whether an entry in the low-end Northeast is profitable for Unilever, or if it should rather refrain from entering this market. It is divided into six parts and provides the reader with the following information: the relevant economic factors, the current social situation and consumer behavior concerning detergent consume and washing habits, the main industry players in Brazil, relevant information about the technology, issues and questions that arise when entering the market, and the final conclusion.
Brazil is the largest country in Latin America and has a population of 170 million. Brazilians are mainly clustered in the Southeast, where the two biggest cities can be found, and in the Northeast. While in the past Brazil's economy used to be characterized by several upturns and downturns, its economy finally boomed, after the Real, the new currency was introduced. This mainly benefited low-end consumers. However, the Brazilian economy is marked by big gaps in purchasing power between the North and the South. While people in the South have a GDP per capita similar to Saudi Arabia's, people in the Northeast have only a third of that.
Social Situation and Consumer Behavior
In order to better understand the use of detergents in the Northeast of Brazil, it is essential to examine the local washing behaviors more closely. Only 28% of the population owns a washing machine and 73% of women think that bleach is necessary to remove fat stains. Laundry soaps are also used very frequently since women use them to scrub clothes. That is of course a very difficult procedure, after which they add bleach and some detergent powder in order to give the clothes a...