Realities of Emerging Markets: Some Lessons from Unilever's Strategy for Lifebuoy & Sunsilk in India
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Case Details:
Case Code : BSTR295
Case Length : 16 Pages
Period : 2001-2008
Pub Date : 2008
Teaching Note : Available
Organization : Hindustan Unilever Ltd.
Industry : Consumer Packaged Goods
Countries : India
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Please note:
This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.
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"Hindustan Unilever is one of the jewels in the company's
emerging-market operations. It is India's biggest consumer-goods company and
biggest advertiser. One of its strengths is its ability to cater to all segments
of the population by adapting products and prices."1
- The Economist, in 2008.
Introduction
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With the growth in the developed markets in North America and
Western Europe approaching saturation, consumer packaged goods (CPG) companies
turned their eyes toward developing and emerging markets to spur future growth.
These markets accounted for 84% of the global population2 and were estimated to
spend US$ 23 trillion dollars on consumer goods.3
However, the efforts of
multinational companies (MNCs) from different industries to tap these markets
had, by and large, resulted in failure. Analysts felt that this was because
these MNCs had failed to understand the realities of operating in these markets.
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Global CGP major Unilever Plc. (Unilever) was one of the companies that had had a headstart in many of these markets - Africa, China, India, and Latin America. For instance, the company had been operating in India since the early 1930s.
Its Indian subsidiary, Hindustan Unilever Ltd (HUL, earlier known as Hindustan Lever Ltd.), held a dominant position in the Indian CPG market with many big brands cutting across categories. It accounted for around 10% of Unilever's worldwide revenue.
Realities of Emerging Markets: Some Lessons from Unilever's Strategy for
Lifebuoy & Sunsilk in India
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