Helping the world’s biggest beauty & personal care business find new growth.
Unilever’s Beauty and Personal Care (BPC) business is worth over €20 billion annually, it comprises a portfolio of multiple billion-dollar brands including: Axe, Dove, Rexona and Sunsilk, and is responsible for 40% of Unilever’s turnover.
In 2017, amidst a backdrop of challenging category growth, Unilever decided to refresh its BPC strategy and create one further rooted in the future needs and behaviours of its consumers – in a category where agile new entrants were stealing share and consumer trends were shifting towards natural and more sustainable products – Unilever wanted to better understand the emergent category opportunities, so that it could assign clear roles for each of its key brands and position itself to take advantage of future innovation and acquisition opportunities.
Unilever sought to expand this understanding in order to accelerate action and over deliver against their ambition. The BPC leadership team approached The Forge, seeking a partner to help provide the key insights into their accelerated, future-proofed growth strategy.
Our hypothesis was that Unilever would have access to a vast repository of data and insight, but what was really required was a fresh perspective on the whole category. We knew that with the right approach it would be possible to both identify new category opportunities and also SIZE them – meaning we could help the business prioritise the most valuable category opportunities and build this into the overall growth plan.
Working at speed, we were quickly able to identify the most relevant data and insight, and combine this with data from external sources including Euromonitor – this enabled us to create a framework that sized the macro-BPC category, sub-categories, as well as Unilever’s individual brands. Our approach differed from a traditional model, because instead of taking a category-by-category view of the landscape, we combined the different category viewpoints to create a cross-category perspective. This approach illuminated a series of cross-category growth opportunities not previously visible at the sub-level.
Onto this framework of category sizes, we identified and overlaid trends data to build a complete picture of where the category could be expected to move in the future. This helped to ensure that our framework and subsequent strategies were sufficiently future-proofed.
How we sized the future
At this point we had a clear idea about where Unilever could play, but not yet clarity on where it should play.
The only way to resolve this was to understand the long-term value of these individual opportunities and SIZE the future. Here’s how we did it:
We used traditional forecasting inputs such as population data, household size, urbanisation rates, cost of goods etc. to formulate a base model. But this alone would leave out a critical consideration: the consumer. To incorporate the ‘future consumer’ into our model we needed to make a number of behavioural predictions (often more tricky), so here are some of the things we factored:
- How are current trends impacting consumer choice & behaviour and how might that continue in the future?
- Will new products, services & experiences create new behaviours and/or displace existing behaviours?
- Will these new behaviours drive penetration and increase frequency of use, number of occasions etc.?
- Will they introduce new needs to the category, or better deliver existing needs?
- Will they change consumer behaviour across all markets, or only a few?
For each of the sub-categories we used primary and secondary data to answer these questions. These were integrated into our growth predictions for each of our sub-categories e.g. does our predicted consumer behaviour suggest:
- An increase in our category CAGR?
- A decline in our category CAGR?
- CAGR will remain the same?
The deliverable was a future-proofed, consumer-centric growth model of the BPC category.
It gave Unilever the clarity and confidence it was seeking and it highlighted the key opportunities available to its flagship BPC business, sub-categories, and brands. Our framework continues to be used by the Unilever board to make key investment and growth decisions across the whole of the BPC category.
- We challenged the traditional, long-held definition of the category with a new total addressable category opportunity
- We identified, sized, and prioritised new cross-category opportunities for growth
- We identified and profiled 6 key trends predicted to influence the future of BPC providing the business with the tools needed to win in each
- Validating the planned launches of exciting new innovations
- A strategy being used by the BPC leadership to steer and influence the whole category
The impact of the project since 2018
Photo credits: x ), Park Street & Midas Hofstra on Unsplash