Unilever Group in Health and Wellness (World) PDF

UNILEVER GROUP IN HEALTH AND WELLNESS
(WORLD)
December 2017
SCOPE OF THE REPORT
Scope
 This profile focuses on the health and wellness (HW) operations of Unilever. In Disclaimer
2016 its global HW retail value sales amounted to US5.0 billion. All market Much of the information in this
briefing is of a statistical nature and,
share data for the review period of 2012-2017 are expressed in current price while every attempt has been made
terms, using fixed 2017 exchange rates. to ensure accuracy and reliability,
Euromonitor International cannot be
 All market size data for the forecast period of 2017-2022 are expressed in held responsible for omissions or
errors.
constant price terms (excluding inflation) using fixed 2017 exchange rates. Figures in tables and analyses are
calculated from unrounded data and
may not sum. Analyses found in the
briefings may not totally reflect the
companies’ opinions, reader
discretion is advised.
Health and Wellness 2017
USD713 billion With increasing demand for
healthy, natural and clean label
food, Unilever is setting a
number of nutritional and
sustainability goals to create
“food that tastes good, does
Fortified/ Naturally good and doesn’t cost the
Better For Earth”. Unilever should continue
Free From Functional Healthy Organic
You (BFY) to broaden its footprint in
USD36 (FF) (NH) USD40.0 emerging countries, while
USD136
billion USD247 USD254 billion focusing on fast growing trends,
billion
billion billion such as organics and free from,
as well as developing its
portfolio through M&A activity.
© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 2

STRATEGIC EVALUATION
CORPORATE OVERVIEW
COMPETITIVE POSITIONING
HW MARGARINE AND SPREADS
HW SAUCES, DRESSINGS AND CONDIMENTS
GROWTH OPPORTUNITIES
RECOMMENDATIONS
APPENDIX
Key company facts
Unilever Group  Unilever Group ranked 14th in the HW market in 2016 at a global
level.
Headquarters London, UK
 Unilever was founded in 1930 by the merger of the Dutch margarine
Regional producer Margarine Unie and the British soap-maker Lever Brothers.
Global
involvement Since then, the company has undertaken numerous corporate
Fortified/functio acquisitions in the packaged food market. However, in 2015, Unilever
nal, BFY, gradually shifted its focus towards beauty and personal care, as well
Category
naturally as home care brands, moving away from its food business through
involvement
healthy, free the divestment of several of its packaged food businesses.
from, organic
 This movement has resulted in slow growth in the food market,
Global HW reflected in a decline of 1% in the HW market between 2015 and
value share 0.7% 2016 at a global level.
(2016)
 To reverse this, each of Unilever’s categories strategies includes
Value growth
specific priorities aimed at growing sales and delivering improved
HW (2015-
-1.5% financial metrics, such as margin and cash flow, against a backdrop
2016) (USD
of continued low growth in markets globally. In its Foods division, the
fixed ex rate)
main priority is to accelerate growth and preserve the value of strong
cash flows, while in its Refreshment division the core strategy is
based on growing ice cream return on capital investment and
accelerating growth in tea.

SWOT: Unilever Group

STRENGTHS WEAKNESSES
Strong brands Global presence HW tough to play in What is next for

margarine?
 Unilever has a large  Unilever operates  Unilever is mainly  With consumers moving
number of power brands globally. Its international known for its presence away from heavily
operating at a global presence in Europe, and in ice cream, margarine processed foods, its
level. This gives it the North America and its and sauces and in many margarine category is
leverage to expand into increasing presence in cases there is great struggling. Its aim to sell
new HW products in Asia Pacific, MEA and scepticism regarding the the business is the right
order to have a larger Latin America give it a healthiness of its move in order to focus
presence in this market. good position to be a products. on a more natural
global leader. offering.
OPPORTUNITIES THREATS
Divergent focus for global M&A activity and NPD to Surge niche brands High presence is
growth develop its HW portfolio threats commodities
 There is potential for  Unilever has heavily  The proliferation of  Unilever’s food sales
organic, natural invested in free from smaller, “authentic” come from low growth
products in developed with its Ben & Jerry’s ice brands, which are categories that are
markets, and it can push cream and Flora growing at a rapid pace highly commoditised.
its FF/reduced sugar margarine, but also in in developed markets, Therefore, there is a
versions of its core the organic arena with represents a major need to focus on higher
brands in emerging Sir Kensington and Mae threat to Unilever’s long- growth or higher margin
markets. Terra acquisitions. term growth. categories.

CORPORATE OVERVIEW
RECOMMENDATIONS
APPENDIX
CORPORATE OVERVIEW
A need to broad its portfolio in organics and free from
 Unilever is clearly focused “old-fashioned” health and wellness categories. Its portfolio is mainly divided
within fortified/functional (FF) packaged food and better for you (BFY) packaged food, mainly reduced fat
and sugar products, as well as naturally healthy (NH) beverages, predominantly coming from the NH RTD
tea category.
 However, it is quite small in organic and free from, which are the two categories delivering the largest
growth in the HW market at a global level. The company needs to keep exploring opportunities in these
areas.
 In September 2017, Unilever acquired the organic herbal tea business Pukka Herbs Ltd, the products of
which are well-known for containing 100% certified, organic and ethically sourced ingredients.
Unilever: Distribution of Sales by Category 2016
Organic Packaged Food
Organic Beverages
Naturally Healthy Beverages
Naturally Healthy Packaged Food
Fortified/Functional Beverages
Fortified/Functional Packaged Food
Free From Foods
BFY Packaged Food
BFY Beverages

CORPORATE OVERVIEW
Unilever’s core category struggles
 Global sales of Unilever’s health and wellness products mainly come from FF margarine and spreads, led
by Becel and Flora, accounting for 11% and 8%, respectively, of global HW sales for Unilever. However,
the category is showing a rather disappointing performance, which is mainly related to the perception of
these products as heavily processed and not healthy.
 The company also has a strong presence in BFY reduced fat and reduced sugar, but again this category is
not popular among many consumers, who are increasingly moving towards a more naturally offering. Its
reduced fat sauces, dressing and condiments and reduced sugar RTD tea are, however, performing well.
 In growth terms in 2016, the leader for the company was its NH soy drinks category, which came from its
brand Ades, leader in Latin America in this category. However, the brand was acquired by Coca-Cola in
March 2017 for USD575 million. Unilever continues the active management of its brand portfolio to sharpen
its focus on other growth categories, such as tea.
Unilever’s Top 10 Largest HW Categories in 2016
Unilever’s sales 2016 % Growth 2015-2016
FF Margarine and Spreads 1,305.3 -0.1
Reduced Fat Sauces, Dressings and Condiments 566.7 5.6
NH RTD Tea 449.9 4.0
NH Olive Oil 311.4 -1.3
Reduced Fat Ice Cream 284.8 -9.9
Reduced Sugar Ice Cream 220.1 -0.4
Reduced Sugar RTD Tea 160.8 2.4
NH Soy Drinks 143.8 8.3
NH Margarine and Spreads 108.3 -5.0
Reduced Fat Cream 103.5 -1.8

CORPORATE OVERVIEW
Sustainability at the heart of Unilever’s strategy
 Unilever reported a EUR12.5 billion turnover in FY2016 (year end 31 December) in the Foods category and
10 billion turnover in the Refreshment category.
 Personal Care is the main pillar of Unilever’s business, but the company is also making significant efforts to
grow the foods and refreshments categories by encouraging growth categories like foods with organic and
traceable ingredients, and free from alternatives.
 In addition, Unilever is committed to social, political and environmental responsibilities, and developed its
Unilever Sustainable Living Plan (USLP) to leverage scale, influence and expertise in innovation and
resources to strengthen its business to grow sustainably.
Unilever Group: Total and by Region Unilever: Segment information FY2015 vs
(EUR million) FY2015 vs FY2016 FY2016
25,000
FY 2015 FY 2016
Unilever 53,272 52,713 20,000
(EUR million)
Turnover
By Region FY2015 FY2016 15,000
Asia/AMET/RU
22,425 22,445 10,000
B*
The Americas 17,294 17,105
5,000
Europe 13,553 13,163
Note: *Refers to Asia, Africa, Middle East, Turkey; Russia, 0
Ukraine and Belarus. Personal Care Foods Home Care Refreshment
FY: fiscal year ended 31 December
Source: Unilever’s yearly statement 2016 FY2016 FY2015

CORPORATE OVERVIEW
Unilever growth in Q2 2017 is based on naturalness
 In 2017 Unilever increased its overall turnover. Unilever Group: Turnover (EUR million) Total for the
 In the Foods category, the company has six months ended June 2017 – FY2017 vs FY2016
continued to modernise the portfolio while H1 2016 H1 2017
building its presence in emerging markets and
sustaining a strong performance in foodservice 26,283 27,725
channels.
 Unilever is investing heavily in natural Unilever Group: Turnover (EUR million)
ingredients, which has already seen success in by segment for the six months ended
some of its well-known brands, such as Knorr and June 2017 FY2017
Hellmann’s. It is also looking at the organic and
free from categories to encourage growth.
 In refreshments, ice cream delivered strong
growth, driven by margin-boosting innovations in
some of its premium brands, such as Ben &
Jerry’s pint range Topped and the Wich
sandwich, as well as Magnum, which grew at
double-digit rates. In addition, Unilever has
extended its portfolio to include offerings with less
than 50 calories under the Solero brand, and
launched vegan and gluten-free variants under
Cornetto.
 All of these developments are in strongly growing
HW categories: organic, NH and free from. Personal Care Home Care Foods Refreshment

CORPORATE OVERVIEW
The US leads Unilever’s sales
 Unilever’s global sales were valued at USD93 billion in 2016, of which USD42 billion come from packaged
food, hot drinks and soft drinks. The US is its largest market by far, where ice cream and RDT tea lead,
showing an impressive positive performance, while sauces, dressing and condiments, margarine and
spreads and ready meals recorded strong declines.
 In ice cream in the US, Unilever
ranks second after Dreyer's Grand.
It is seeing competition from fast-
growing companies such as Halo
Top Creamery.
 Italy is the country in which the
company saw its worst
performance, with ice cream being
one of the most affected categories.
As Italian consumers continue to
focus on health and calorie intake,
they will increasingly favour
artisanal ice cream made with local
ingredients rather than packaged
ice cream, thus moving away from
some of the most well-known
Unilever brands, like Cornetto,
Carte d’Or and Viennetta. All of
these brands lost share in the
Source: Euromonitor Analytics country over the review period.

CORPORATE OVERVIEW
The Unilever Sustainable Living Plan at the heart of its strategy
 Unilever is very committed to ethical and social responsibilities. The company is working to reduce its
environmental footprint and increase its positive social impact through its well established Unilever
Sustainable Living Plan (USLP). The plan sets stretching targets, including how the company sources its
raw materials and how consumers use its brands.
 In 2016, 51% of Unilever’s agricultural raw materials were sustainably sourced, including 95% of its top 13
vegetables and herbs and 75% of tea, supporting brands such as Knorr and Lipton.
 It is committed to help more than a billion people to improve their health and hygiene by 2020. Moreover,
by 2020, it is looking to double the proportion of its portfolio that meets the highest nutritional standards,
based on globally recognised dietary guidelines, in order to help hundreds of millions of people to achieve a
healthier diet. The company has already reduced the calorie content of its children’s ice creams and other
products, as well as removed trans fat. It has achieved a reduction in saturated fats and increased essential
fatty acids in 92% of its portfolio, and has provided healthy eating information for 86% of its products.
 35% of Unilever’s portfolio by volume met the highest nutritional standards in 2016, which shows that the
company is on the right path to empowering consumers to make healthier and more sustainable choices.
To continue like this, the company is planning to reduce salt and sugar levels in its portfolio, as well as
reduce saturated fat in more of its products.
Unilever’s three main goals

CORPORATE OVERVIEW
Innovation, sustainability and fight malnutrition lead Unilever’s strategy
 Unilever’s sustainability mission is based on “Food that tastes good, does good and doesn’t cost the earth”.
This remains a very important value in its category strategy. The company has a goal to halve the
environmental footprint of the making and use of its products by 2030.
 In addition, Unilever is committed to sourcing 100% of its agricultural raw materials sustainably by 2020. It
is in the right direction to achieve this, as, by the end of 2016, the company already sourced 51% of
agricultural raw materials sustainably, based on 67% of the fruit and 92% of the vegetables used in its
recipes being sustainably sourced, as well as 77% of its Ben & Jerry’s brand being fair trade. Moreover, it is
planning to develop sustainable agricultural raw materials for oils (palm, sunflower and rapeseed), soy
beans, tea, cocoa, sugar, dairy and cage-free eggs.
 Unilever is greatly focused on sustainability and innovation, spending EUR1 billion annually on research
and development, employing approximately 6,000 experts to drive innovation, often in partnership with
suppliers and academia. The company’s innovations use insights and technologies to deliver brand-led
benefits which meet the latest trends. Examples include natural variants of its Knorr brand and vegan
product variants of Ben & Jerry’s and Hellmann’s.
 In addition, the company is fighting against malnutrition globally. It has improved food fortification with Blue
Band in Africa, and continues to promote healthy, nutritious cooking with Knorr.
 Knorr is aiming to tackle malnutrition. An example is its programme Green Food Steps, which
was launched in 2015, seeking to reduce the prevalence of iron deficiency anaemia among
young women through the introduction of iron-fortified Knorr cubes, helping 70,000 mothers and
daughters in 2016 to understand the importance of an iron-rich diet. In addition, in 2016, the
company sold more than 18 billion servings of its Annapurna/Captain Cook iodised salt in India
alone, while its Maizena porridges are fortified with iron, zinc and vitamins A, B1, B3, B6, B12, C
and folic acid in Latin America.

CORPORATE OVERVIEW
HW by prime positioning
Global Retail Sales 2017

General Well-being Bone and Joint Health
USD375.8 billion USD15.0 billion
Weight Management
USD121.9 billion Cardiovascular Health
USD8.6 billion
Digestive Health
USD63.8 billion Vision health
USD4.4 billion
Energy Boosting
USD37.3 billion
Brain Health and Memory
Free from USD5.0 billion
USD36.2 billion
Immune Support
Oral/Respiratory Health USD4.2 billion
USD20.3 billion
Endurance Others
USD 19.6 billion USD1.0 billion

CORPORATE OVERVIEW
General Wellbeing is the core positioning for Unilever
 Unilever has most of its portfolio in the general wellbeing positioning. Unilever : HW Retail Sales by
Its RTD tea brand Lipton is the largest in this category, valued at Prime Positioning 2016
USD1.2 billion at a global level. Following far behind is olive oil brand General
Gallo and soy drink Ades, recently sold to c, valued at USD263 million Wellbeing
and USD236 million respectively. USD2,860 million
 Weight management is the second largest prime positioning for
Unilever, which is related to its reduced fat and sugar portfolio. The
brand leader in this category is Hellmann's, in particular its reduced fat Weight
Management
version. Breyers ice cream ranks second in this positioning through its USD1,472 million
reduced fat and sugar variants.
 Cardiovascular health is also an important category for Unilever, which
is mainly coming from margarine and spreads and in particular its two Cardiovascular
well established brands Becel and Flora, valued at USD388 million Health USD848
million
and USD259 million respectively.
 Cardiovascular health is showing a rather disappointing performance
overall at a global level. Margarine and spreads are perceived as
Free From
heavily processed foods, which his not helping the performance. USD127 million
 Free from is its fourth largest category. It is still small compared with
the top three prime positionings, but has significant growth potential. In
addition, Unilever could pay attention to energy boosting, as it could be Other Prime
Positioning
developed through its drinks portfolio and is the prime positioning
USD13 million
predicted to see the largest growth over the forecast period.

CORPORATE OVERVIEW
RECOMMENDATIONS
APPENDIX
Unilever lags behind in the global HW market
Health and Wellness: Leading Global Players by Value  The HW market is highly fragmented, and is
Share 2016 and Ranking 2011-2016 leaded by well-established companies, with
2016 Unilever ranking 14th in 2016.
6-year
 TCCC leads due to its better for you offerings
2012
2013
2014
2015
2016
2011
%
Company rank
value (Diet Coke and Coca-Cola zero), as well as its
trend
share Minute Maid juice brand. In addition, it is
Coca-Cola Co, increasingly investing in good nutrition. At the
 1 1 1 1 1 1 5.0 end of August 2017, the company announced
The
PepsiCo Inc  2 2 2 2 2 2 4.1 that it will pay USD1 million to whoever can find
an alternative to sugar. TCCC is hoping to
Nestlé SA  3 3 3 3 3 3 4.0 crowdsource a replacement for sucrose, which
Danone, has so far eluded the soft drinks giant.
 4 4 4 4 4 4 3.4
Groupe  PepsiCo follows closely, which is mainly due to
Mondelez
 - 7 7 7 8 5 1.3 its sports drink Gatorade, which goes in line
International Inc with the increasing number of consumers
Kellogg Co  6 5 6 6 5 6 1.3 including exercise and fitness as part of a
Red Bull GmbH  8 8 8 8 7 7 1.3 healthy and active lifestyle.
General Mills  Nestlé and Danone compete strongly against
 7 6 6 6 5 8 1.3 each other. Danone’s acquisition of WhiteWave
Inc
Monster will help narrow the gap between them.
 - 19 16 14 10 9 1.0
Beverage Corp  Unilever lags far behind in the list, which is
Suntory mainly related to the strong focus of the
 10 11 9 9 9 10 1.0 company on beauty and personal care, as well
Holdings Ltd
Unilever Group  11 10 12 12 13 14 0.7 as home care.

Keep growing in free from and organic categories
 Unilever competes with core HW players in the FF, better for you and NH arenas. Naturally healthy is its
strongest category, thanks to its RTD tea Lipton, its soy drink Ades (recently sold to Coca-Cola) and its NH
olive oil brand Gallo. The company is modernising its portfolio by reformulating existing products and has
launched new “100% natural” variants under its well-known brand Knorr.
 Unilever also competes in FF, mainly with its FF margarine and spreads portfolio. Becel, Flora and Rama
are its strongest brands in this category. Unilever is also playing strongly in fighting malnutrition through
fortification of its Knorr cubes, and iodised salt and vitamin and mineral fortification of its Maizena porridge.
The better for you category is also important for Unilever through the reduced fat or sugar versions of
Hellmann’s, Breyers ice cream and Lipton tea.
 On the other hand, there is a need to grow in the free from and organic categories, as they are the fastest
growing categories in the HW market. Its two main brands in the free from category are soy-based products
Ades, now owned by Coca-Cola, and the meat alternative brand Knorrox Soya Mince. Organic remains
very small, although the company launched an organic variant under Hellmann’s in 2016 and has recently
invested in organic products, such as the organic tea Pukka Herbs, the natural and organic food business
Mãe Terra, and organic mayonnaise with the acquisition of Sir Kensington.
Global HW Sales by Selected Companies in 2016
15,000
Retail value sales
(USD million)
10,000
5,000
0
Coca-Cola Co, The PepsiCo Inc Unilever Group Nestlé SA Danone, Groupe Kellogg Co
Better For You Fortified/Functional (FF) Free From Naturally Healthy (NH) Organic

Unilever loses shares across the board
 Unilever’s largest region in Health and

Wellness is Western Europe, valued at
USD1.7 billion in 2017, followed by
North America with USD1.3 billion.
When looking at the overall health and
wellness portfolio of Unilever, however,
it is notable that the company’s
footprint is widespread globally in
terms of company share in the different
regions.
 Unilever saw a significant loss in share
between 2011 and 2016. There is
increasing competition coming from
other major players, which is heavily
impacting the company. Smaller
companies playing strongly in the
health and wellness market –
particularly free from and organic – are
also driving growth in the market.
 Unilever has recently invested in fast
growing trends which will better
position the company in the health and
wellness market in developed
countries.

Competitive landscape for Unilever
 Within packaged food in

particular, Unilever has the
biggest overlap with Nestlé,
due to its presence in soup,
bouillon and ready meals,
through its Knorr brand.
 Kraft Heinz is another close
contender – the two companies
have an almost perfect overlap
in table sauces, especially in
mayonnaise and mustard,
which also underlies Kraft
Heinz’s latest attempt to
acquire Unilever’s food
business.
 The third largest competitor is
Froneri, the new joint venture
formed by Nestlé and R&R,
focusing on ice cream, frozen
desserts and chilled dairy. This
is likely to see growing overlap
with Unilever, due to the latter’s
growing focus on ice cream.

Competitive landscape for Unilever
 Within packaged food in

particular, Unilever has the
biggest overlap with Nestlé, due
to its presence in soup, bouillon
and ready meals, through its
Knorr brand.
 Kraft Heinz is another close
contender – the two companies
have an almost perfect overlap
in table sauces, especially in
mayonnaise and mustard, which
also underlies Kraft Heinz’s
latest attempt to acquire
Unilever’s food business.
 The third largest competitor is
Froneri, the new joint venture
formed by Nestlé and R&R,
focusing on ice cream, frozen
desserts and chilled dairy. This
is likely to see growing overlap
with Unilever, due to the latter’s
growing focus on ice cream.

Boosting growth in emerging markets
 The country where Unilever overlaps most with its main competitor, Nestlé, is the US. The major overlap in
this market by far happens in ice cream, followed by ready meals.
 Germany is in second position,

which is related to the strong
presence of both companies in
sauces, dressing and condiments.
 The US, Germany and Canada
(the country with the third largest
overlap) are recording rather
disappointing performances, in
the same way as other developed
countries.
 On the other hand, emerging
countries like China, Israel and
Mexico, where the two companies
also have a significant overlap,
are performing positively for
Unilever, which is related to the
company’s strategy of
accelerating growth in emerging
markets, which now account for
more than 40% of its sales.

CORPORATE OVERVIEW
RECOMMENDATIONS
APPENDIX
Organic margarine and spreads the only bright star
 Unilever’s largest HW category is margarine and spreads, Hw Margarine and Spreads by

with a strong presence mainly in the FF category, but also in Type at Global Level 2012-2017
NH. Both showed a negative performance in the review 5,000 8
period.
Retail value sales in 2017 (USD million)

 Unilever has decided to get dispose of its spreads business, 4,000 6
reflecting the perception of margarine as a processed,
3,000
artificial and unhealthy food. Concerns about trans fats in the 4
% CAGR 2012-2017
2000s led to many brands removing hydrogenated fats from
2,000
their spreads and reformulating their recipes. However, sales 2
have continued to fall. 1,000
 As consumers are looking for healthier alternatives, positive 0
growth has been recorded by organic margarine and spreads, 0
as they are perceived as more natural and healthier options. -2
-1,000
 St Hubert and Rapunzel account for a large share of organic
margarine and spreads ,with a 45% share at a global level, -2,000 -4
and saw positive performance in the review period. Valle
(Dairy Crest Group Plc) occupies third position, and saw -3,000 -6
impressive 51% growth in 2016, which suggests that these
FF NH Organic Reduced
variants have potential for growth overall. Margarine Margarine Margarine Salt
and and and Margarine
 However, Unilever is not strong in this category, with its only Spreads Spreads Spreads and
major organic margarine being Vitam, present in Greece and Spreads
Georgia, and not showing a positive performance. Market size 2017 % CAGR 2012-2017

Indonesia leads growth in FF margarine and spreads
 Unilever´s largest country in FF margarine and spreads is Brazil. With the continued rise in demand for
healthier products, fortified/functional products are increasingly seen as being in line with leading a
healthier lifestyle. Despite the fact that Brazil is still suffering from the economic crisis, a large number of
consumers are including FF products in their daily routines.
 In Finland, fortified/functional packaged food struggled in 2016 overall as it faced maturity, whilst the
sluggish economy in the country slowed spending. However, FF margarine and spreads has been
successful with Unilever gaining share with its more traditional brands such as Becel, Flora and Latta and
the launch of Crème Bonjour in 2013.
 Indonesia is the country with largest growth out of the top 10 largest markets for Unilever. Blue Band from
Unilever increased its share in in FF margarine and spreads in 2016. In 2015, Unilever re-launched a new
Blue Band Serbaguna range, which claims to contain essential fatty acid Omega 3 and Omega 6, vitamin A,
B1, B2, and D, and to be free from trans-fat. The new product has been aggressively advertised via the
mass media and through various below-the-line events, thus helping to boost sales in 2016.
Unilever Group: FF Margarine and spreads in top 10 largest countries in 2016
190 10
Retail value sales in 2016
% CAGR 2011-2016
140
5
(USD million)
90
0
40
-5
-10
-60 -10
Brazil Finland Mexico USA Netherlands New France Indonesia Czech Russia
Zealand Republic
Market size 2016 % CAGR 2011-2016

MEA will drive growth in the coming years
 The future is not looking bright for Hw margarine and spreads in Western Europe, North America and Asia
Pacific. Whereas Middle East and Africa is the bright star that is estimated to account for the majority of the
growth in the category in the coming years.
 The decline of the business in most of its strongest markets is based on the fast pace of change as
consumers are shifting to more natural and healthy alternatives while margarines is perceived as a heavily
processed food. This has resulted on Unilever wanting to sell its spreads business, in a bid to attract
greater returns for shareholders and become more focused.

Form Dairy-free and flavoured spreads to algae?
 Unilever is convinced on this movement as it has kicked off the long-awaited

sale of its margarine division in September 2017, which includes household
brands like Flora, Stork and Bertolli, by striking a deal in South Africa with the
investment group Remgro.
 South Africa is actually estimated to show positive value growth in the forecast
period but the strategy of selling the business is likely to be executed across the
board. In the meantime, Unilever keeps exploring opportunities in the spreads
business to deliver growth.
 Back in 2016, the company invested on its Flora brand by launching a
£12.5million marketing campaign and dairy-free spread in the UK. The campaign
was driven by highlighting all of the plant-based ingredients used in the spreads,
including rapeseed oil, linseed oil and sunflower oil. With the huge movement on
free from dairy products being one of the fastest growing categories, it was a
clever movement. This was followed by the introduction of three new flavours in
the Flora Freedom range in May 2017, including walnut, coconut and almond,
and avocado and lime varieties, which follow on the increasing desire for plant-
based diets and it was also a way to capitalise on growing interest in nut butters.
 Keep exploring with plant based and natural ingredients is the way forward. An interesting example is the
margarine Optima DHA, launched by ZT Kruszwica SA in Poland in June 2016. It is targeted to the health-
conscious consumer, containing DHA extracted from microalgae. Algae are, in fact, an excellent source of
omega-3 fatty acids in the form of EPA and DHA as well as chlorophyll and other plant pigments and
important marine minerals such as iodine. The nutritional value of all of them could be highlighted as a
selling point.

CORPORATE OVERVIEW
RECOMMENDATIONS
Naturalness and organic verities are key to succeed
 Although the reduced fat sauces, dressings and Hw Sauces, Dressings and
condiments category is the largest by far at a global level, it Condiments by Type at Global Level
showed a rather disappointing performance; being Sweden, in 2017
Belgium and the US the markets with the worst 4,000 9
performance in the review period. 8

3,500
 On the other hand, reduced salt and mainly the organic

7
variants showed very positive growth. 3,000
 In particular, in the US are found the two brands with 6
% CAGR 2012-2017
largest growth globally in the organic sauces, dressings and 2,500
5
condiments category - Newman's Own (Newman's Own
Inc) and Annie’s (General Mills) with USD52 million and 2,000 4
USD16 million growth respectively in the review period. 3

1,500
 These brands are great examples to
2
follow as they highlight the naturalness 1,000
of the ingredients used and in 1
particular Newman's Own highlights 500
0
the inclusion of olive oil, and it is
perceived as home-made with a 0 -1
traditional recipe. Organic Reduced Fat Reduced Salt

Sauces, Sauces, Sauces,
 Unilever is following on these trends Dressings and Dressings and Dressings and
with the acquisition of Sir Kensington Condiments Condiments Condiments
in April 2017, a New York-based

premium condiment maker. Market size 2017 % CAGR 2012-2017

Tapping into organic sauces through Sir Kensington’s acquisition
 The acquisition of Sir Kensington’s is focused on the

trends for “authenticity”, quality and natural ingredients.
Consumers are also seeking more opportunities to
incorporate healthier sauces into their home-cooked
meals, with the aim to provide a gourmet flair . This is
benefiting premium condiments, such as Sir
Kensington’s, which also includes a vegan (chickpea-
based) mayonnaise in its portfolio. Moreover, all the
range is certified organic, which again is perceived by
consumers as more natural and healthier.
 In this context, Unilever’s acquisition of Sir Kensington’s
represents an easy entry point into premium
condiments, while at the same time challenging the
dominance of Kraft Heinz’s brands in mainstream stores.
 The brand also fits in with Unilever’s long-term objective
of becoming a sustainable nutrition business which
relies less on animal-based ingredients with a higher
carbon footprint, and instead on building a large portfolio
of brands with local and sustainably sourced ingredients.
In addition, the acquisition highlights Unilever’s decision
to remain committed to the sauces, dressings and
condiments business, along with ice cream.

Argentina fuel growth of the reduced fat offering
 Moving into more premium and organic sauces, dressings and condiments should benefit Unilever.
However, its reduced fat variant is the largest category in the HW market, with its sales valued at USD565
million globally and against the general trend, these products are growing across the board.
 The US is its largest market in this category. Hellmann’s reduced fat is its main brand, and grew by 5%
between 2011 and 2016 in the country. Argentina is its third largest market, and it recorded impressive
growth, driven by the reduced fat versions of Hellmann’s and Knorr, with 32% and 34% CAGRs,
respectively, over the review period.
 Unilever Argentina continually promotes the use of mayonnaise as a condiment, with a variety of
campaigns on television. In early 2016, one of its adverts showed different foods, while the announcer –
pretending to be a French chef – said they were ordinary, but the new Hellmann's dishes were rated as the
crème de la crème. Pushing with marketing campaigns in emerging markets is key to success with this
offering.
Unilever Group: Reduced Fat Sauces, Dressings and Condiments
in Top 10 Markets 2011-2016
200 40
Retail value sales in 2016
% CAGR 2011-2016
150 30
(USD million)
100 20
50 10
0 0
US Brazil Argentina UK Spain Canada France Chile Russia Mexico

Russia and Australia – disappointing performances
 Russia and Australia are predicted to see significant declines in the coming years for HW sauces,
dressings and condiments. The decline expected in Russia will be linked with increasing price competition
in the saturated categories of ketchup and mayonnaise. In addition, the category is not expected to benefit
from the same average unit price growth as in previous years, due to the economic downturn and national
currency devaluation. In the case of Australia, consumer tastes will continue to show a shift away from dry
and what are perceived as processed sauces, dressings and condiments, and a movement towards liquid
and “natural” varieties. In addition, the poor performance in Australia will be related to time-poor consumers
shifting away from convenient cooking aids, such as wet cooking sauces, towards ready meals, especially
as the quality and options available within ready meals has improved.
 On the other hand, Latin America is expected to boost growth of the category at a global level, along with
the Middle East and Africa, North America and Western Europe.

What is next for sauces, dressings and condiments?
 Looking at the countries that are predicted to grow the Hw Sauces, Dressings and
most in absolute terms in the forecast period, the US leads, Condiments Countries with Largest
following on the use of organic and natural ingredients. Absolute Growth 2017-2022
 Japan is forecast the second largest growth. The largest 3,000
category in 2017 is reduced fat sauces, dressings and
condiments, but reduced salt variants are predicted to see
faster growth, at a 5% CAGR over 2017-2022. 2,500
 Consumers in Japan are focusing more on cooking at
home to save money, as a result of the slow economic
growth in the country. In addition, some Japanese 2,000
manufacturers within packaged food have failed to maintain
USD million
food safety, which has contributed to consumers looking for
health and wellness variants. Kewpie is the largest brand in 1,500
HW sauces, dressings and condiments in Japan,
accounting for 24% of value in 2016, and is particularly
strong in mayonnaise and salad dressings. 1,000
 Japan would be a difficult market for Unilever to enter, as it
is dominated by local players.
 Argentina and Mexico will boost growth of HW variants in 500
the coming years, so Unilever should keep an eye to both
countries.
 The company is also advised to focus its efforts on high- 0
US Japan Argentina Mexico
end retail shops, such as health food stores, as well as e-
commerce. Retail value sales in 2017 Absolute growth 2017-2022

CORPORATE OVERVIEW
RECOMMENDATIONS
APPENDIX
Free from and organic ice cream the way forward
 HW ice cream is an important category for Unilever, HW Ice Cream by Type at Global Level
as its reduced sugar and reduce fat ice creams 2017-2022
combined had global sales of USD505 million in 2016. 3,000 9
 In the HW market, the US is the largest country, where
Unilever ranks second, after Dreyer's Grand. The 8

2,000
leaders face competition from rapidly growing newer
entrants, such as Halo Top Creamery. With its
6
emphasis on small pint-sized portions, low sugar, high
% CAGR 2017-2022
1,000
protein content, low calories and a plethora of creative
5
flavours, Halo Top’s ice cream products are in line with
a significant number of current consumer trends. To 0
compete against this, in July 2017, Unilever began 3
distributing a range called Breyers Delights, which has -1,000

remarkably similar qualities to Halo Top, coming in 2
pint-sized packaging and touting a low calorie and high
protein content in a highly visible front-facing font -2,000
0
similar to the design of Halo Top.
 Free from dairy ice cream and organic variants show -3,000 -2
the largest opportunities in terms of growth. Free
Reduced Fat Reduced From Dairy Organic Ice
 In the free from category, the US is the largest market, Ice Cream Sugar Ice Ice Cream Cream
Cream Alternatives
followed far behind by Italy, while in the organic
category, the UK ranks second after the US.

Plant based ice cream to meet vegan demand
 Unilever is investing in free from dairy ice cream through its Ben and
Jerry’s brand, in order to meet with consumer demand for plant-
based alternative formats.
 US-based Ben & Jerry’s introduced a range of free from dairy ice
creams in February 2016, which proved successful. According to
Unilever’s first quarter results, the brand grew at double-digit rates,
driven by the launch of its vegan variant, available in four flavours.
The US was a trial market for vegan ice cream, and Unilever may
well take the lessons learned from the US to expand the brand into
other markets, notably Western Europe and Australia, where the
vegan movement is gaining traction. Unilever launched its Ben &
Jerry’s vegan ice cream in the UK in September 2017, made with
almond milk and featuring Fairtrade certification.
 To meet the consumer demand for free from food, Unilever
extended its less than 50 calories offering under Solero, and
launched soy-based, vegan and gluten-free variants of Cornetto in
Italy.
 These are just the first steps to penetrate a growing category.
Almond is currently popular among consumers ,but variants such as
coconut, oats, rice, hazelnut, walnut could also be explored.
 Offering organic, clean label and all natural ingredients will also help
to succeed in this category.

Matcha tea, the gold standard under Lipton and Pure Leaf brands
 RTD tea is another category with huge importance for Unilever, with its presence in NH RTD tea, mainly
through its Lipton brand. It accounted for a 2% share at global level in 2016, with sales of USD450 million.
 Lipton launched matcha and chai tea in the US in December 2016, while it also launched Pure Leaf in the
US as a premium proposition in hot tea.
 Building on the success of the Pure Leaf ready-to-drink brand in the US, the range has been extended into
premium leaf teas.
 Pure Leaf announced in October 2017 the launch of its first ever Rainforest Alliance Certified matcha teas.
The two new matcha offerings from Pure Leaf are available in pre-portioned, individually wrapped sachets,
that shows the movement into green tea. This is a great launch taking into account that NH green tea is
growing ahead of NH RTD tea at a global level.
 According to Unilever, leaf tea is showing good growth, and it is increasingly seeing the benefits of its
innovations in the speciality and premium tea segments. Lipton was launched in Brazil and Argentina, and
is extending its presence in the fast-growing green and categories segments, while T2 has continued to
show strong growth.
HW RTD Tea by Type at Global Level in 2017
Retail value sales in
% CAGR 2017-2022
2017 (USD million)
30,000 6
20,000 4
10,000 2
0 0
-10,000 -2
-20,000 -4
NH RTD tea Reduced FF RTD tea Reduced NH green tea Organic Reduced
sugar RTD caffeine RTD green tea caffeine
tea tea green tea

Premiumisation to revive the tea category
 Green tea is growing in popularity globally and is predicted to grow at a 2% CAGR between 2017 and
2022. The US is expected to struggle in the coming years, though. Unilever’s retail value share in the tea
category has fallen in the country, as its brands have failed to match the growth of the category as a whole.
Consumers migrated to what they perceived to be more exciting and premium offerings from other
manufacturers, and this is reflected in Unilever’s movement into the more premium segment with its tea
brands.
 Looking at Growth Opportunities, the UK, India and Israel are the three countries forecast to see the fastest
growth between 2017 and 2022 , with 17%, 15% and 13% CAGRs respectively. These countries will need
to be watched in order to develop Growth Opportunities.

Pukka’s acquisition to address Unilever’s organic gap in its portfolio
 Organic tea is also a category to be explored, as it is Organic Tea Countries with

expected to deliver strong growth. Largest Absolute Growth
 The US is predicted to lead growth, as interest in hot tea has 2017-2022
400
flourished and consumers are becoming more sophisticated
in their consumption. Loose leaf tea has made strong gains,
as have premium variants and organic options. 350
 The increasing demand for organic tea resulted in the

300
acquisition by Unilever of the UK company Pukka Herbal tea,
which is a shrewd move, given that the brand grew at 7%
CAGR between 2011 and 2016. 250
USD million
 Unilever believes that this acquisition strengthens its tea
business by addressing a gap in its portfolio. Pukka is a 200
premium player in the natural, organic health and wellness

category, which is fast-growing, attractive and scalable. This 150
acquisition is expected to be very successful.
100
50
0
USA Canada China India
Retail value sales in 2017 Absolute growth 2017-2021

Organic and natural ingredients the way forward
 Unilever’s investment in the organic category goes beyond Pukka organic tea, with the recent acquisition of
the Brazilian natural and organic food business Mãe Terra, in October 2017. The company operates in
several categories with a portfolio that includes cereals, cookies, snacks and culinary products.
 Mãe Terra has a strong following in Brazil, and the acquisition allows Unilever to expand in the natural and
organics segments, which are growing very fast. Moreover, Unilever’s expertise and distribution channels
will help Mãe Terra to grow in scale. The brand is also in line with the company’s commitment to
sustainable nutrition and its aim to provide consumers with “food that tastes good, does good and doesn't
cost the Earth”, which is the main message of Unilever’s sustainability plan.
 Overall, this acquisition is another example of the efforts of Unilever to accelerate its expansion in the high-
growth organic, free from and natural categories, following current trends. Moving forward, Unilever should
keep this line in order to compete in the health and wellness arena.
 The company has
increased its
investment in Unilever
Foundry, a platform to
engage with start-ups,
where the most
ground-breaking
innovations in foods
are taking place,
putting the company in
a good position.

CORPORATE OVERVIEW
RECOMMENDATIONS
APPENDIX
RECOMMENDATIONS
Recommendations
Move away from old health and wellness trends Continue to grow in organic and free from
 Unilever is a global leader mainly through its  Unilever is very committed to the most current health
and wellness trends and it is investing in plant-based
fortified/functional (FF) offering and better for you
(BFY) packaged food , mainly reduced fat and ingredients with the development of free from foods
sugar products, which are categories showing a within its ice cream and margarine offering, with its
rather disappointing performance. Ben & Jerry´s and Flora brands.
 Consumers want to move away from heavily  Organic and premium products are also at the top of
processed food, which has resulted in Unilever the list, which is shown in its acquisition of Sir
Kensington’s sauces, organic herbal tea Pukka and
wanting to sell its spreads business, in a bid to
the Brazilian natural and organic food business Mãe
become more focused on a more natural offering,
Terra. This is the right track to follow in the coming
which will be a good move for the company. years.
Push growth in emerging countries Keep focusing on nutrition and sustainability goals
 Unilever saw significant loss in share over 2012-  Unilever’s sustainability mission is based on “food that
2017. There is increasing competition from other tastes good, does good and doesn’t cost the earth”,
major players, like Nestlé and Kraft, which is which remains a very important value in its strategy. In
heavily impacting the company. Also, smaller addition, fighting malnutrition is at the heart of
companies strongly playing in the free from and Unilever´s commitments.
organic arenas are driving growth in the market.  The company will need to keep focusing on
 Emerging countries in Latin America, Asia sustainability and innovation, investing in research and
Pacific and MEA will need to be a focus to development in order to maintain its leadership in
deliver growth. these categories.

CORPORATE OVERVIEW
RECOMMENDATIONS
APPENDIX
APPENDIX: COMPETITOR ANALYTICS
Competitor Analytics tool
 Competitor Analytics is a new tool from Euromonitor International that focuses on fmcg companies and
competitors. It visualises the retail sales footprint and performance of more than 25,000 companies by
geography and product category.
 Competitor Analytics also maps the competitive landscape for each of these companies, allowing users to
see with whom each company competes and in which specific markets. To do this, the tool calculates a
numeric “distance” between competitors, allowing the user to track how the competitive landscape is
evolving and which companies are becoming strategically more or less similar.
 For a detailed explanation of the graphics in each of Competitor Analytics’ four tabs – Overview,
Competitors, Treemap and Overlap Matrices – please refer to the following slides.

Overview
 The Overview tab (shown in the graphic below) provides a global snapshot of a company’s sales footprint
and performance, highlighting where it is winning and losing by country and product category.
 It shows company (GBO) retail value sales and absolute growth by countries and categories in current
terms and US dollars at a fixed exchange rate for the years spanning 2011 to 2016.
 The grey bars represent value sales in the selected “Start Year”, while the green bars show the subsequent
absolute value sales increase between the user-selected start year and 2016. Red bars denote a retail
value decline over the same time period.

Competitors
 The Competitors tab (see graphic to the

right) plots the “competitive distance”
between the selected “focal” company (in
this case Unilever) and its competitors.
 The vertical axis measures the size of
“market overlap” between two companies,
and is the metric for quantitatively
measuring competitive distance. The higher
a company is on the vertical axis, the bigger
a competitor it is for the focal company.
 Meanwhile, the horizontal axis captures
each company’s total retail value sales over
the selected time period, irrespective of
market overlap.
 Flat lines (eg Nestlé in the chart to the right)
indicate that a competitor’s total sales are
growing, but mainly in markets where the
focal company is not present.
 Lines moving steeply upwards (eg Procter
& Gamble) show that competitive similarity
is increasing strongly over time relative to
overall retail sales growth.

Market Overlap
 Market Overlap is a measure of

competitive distance between two
companies in retail value terms.
 It is calculated as the sum of the
smaller of the two company’s
retail value sales in each of their
common country/category (aka
market) combinations. The sum of
these observations indicates a
total Market Overlap.
 In 2014, Procter & Gamble and
Unilever were present in 711
common markets (see right)
across the global fmcg universe.
 In US deodorants, Procter &
Gamble was the smaller of the
two, and thus defined the Overlap.
 In US hair care, Unilever was
smaller and thus defined Overlap.
 Replicating this exercise across
all 711 markets in which both
companies were present yields a
total 2014 Overlap of US$23,420.

Treemap
 Treemap (as shown in the graphics below ) shows either overlap with a competitor (the left graphic) or
individual company sales (the graphic on the right) by product category and/or country.
 The size of each box indicates the proportional size in US dollars of a country, category or market relative
to the total overlap or sales for the geographies and industries selected.
 The colour gradient reflects sales or overlap growth/decline over the selected time period. The darker the
green, the higher the growth, and the darker the shade of pink/red, the stronger the rate of decline.

Overlap Matrices
 Overlap Matrices (as shown in the graphic below) compare two selected competitors (Unilever Group vs
Procter & Gamble Co) in terms of their respective presence across countries and product categories.
 The darker the colour shading, the higher the company’s retail value share in that market. The graphic
below shows that Procter & Gamble has a strong share in hair care in China, whereas Unilever is weaker.
 Overlap Matrices also highlight respective market gaps and potential white space opportunities. Dark grey
boxes indicate that one of the two companies shown is present in that market, but the other company is not.
A light grey box means that neither of the two selected companies is present.

APPENDIX: INDUSTRY FORECAST MODEL
About Euromonitor International’s Industry Forecast Model
 The Industry Forecast Model is a new tool from Euromonitor International that integrates intuitive,
judgment-based forecasting with the quantitative techniques of an econometric Industry Demand Model.
 The Industry Demand Model assesses the relationship between several historic quantifiable independent
variables (demand drivers) and historic retail volume sales for different markets that Euromonitor tracks.
 In identifying these relationships, the model estimates elasticities for each statistically significant demand
driver, including income growth, changing retail prices, demographic trends and retail channel trends.
 Multiplying these elasticities by corresponding year-on-year growth forecasts for each demand driver allows
the Forecast Model to build annualised retail volume and value forecasts for a market in a given year.
 While estimated demand driver elasticities are constant, forecast demand driver growth can change over
time. For example, forecast GDP growth for a given year is regularly upgraded or downgraded in
Euromonitor International’s Macro Model to reflect changing economic and sociopolitical conditions.
 In turn, changing only forecast growth for GDP in this example allows the Packaged Food Forecast Model
to create multiple retail forecasts that capture the impact of these changing macroeconomic conditions.
Impact of Russia GDP Shock on Chocolate Confectionery Retail Volume Forecast in Russia
2015 real GDP % Chocolate income Income effect on 2015 chocolate %
growth forecast elasticity chocolate growth volume growth
Baseline Forecast
+1.43 0.37 +0.53pp +1.41
(June 2014)
Updated Forecast
-3.82 0.37 -1.41pp -0.55
(December 2014)

Soft drivers and the Industry Forecast Model
 The power of Euromonitor International’s forecasting methodology is that it blends statistical modelling with
local market observations reflecting local industry consensus. As such, retail market forecasts also rely on
the insights and expertise of Euromonitor’s global analyst network. Euromonitor analysts work closely with
the Industry Demand Model to ensure that it remains consistent with their empirical observations,
guaranteeing that quantitative and intuitive expectations fully complement each other.
 Euromonitor analysts also capture all the demand drivers beyond the scope of the Industry Demand Model.
These “soft drivers” remain critical to future retail sales, but are either fundamentally unquantifiable or have
no globally comparable data with which to measure them.
 Soft drivers are captured and measured exclusively by empirical research from Euromonitor analysts, and
their overall positive or negative impact is estimated on top of the results of the Industry Demand Model.
Demand Driver Soft Demand

Forecast Demand
Elasticities: Drivers:
Driver Growth:
From Industry From Country and
From Passport
Demand Model Industry Research
Industry Forecast Model

Growth decomposition explained
 To help understand and illustrate the impact of each demand driver to a market’s retail growth performance
and prospects, Euromonitor International employs a graphical tool called “growth decomposition”.
 The fundamental idea behind growth decomposition is that a product category’s retail sales performance
and future prospects can be explained through changes in underlying demand factors.
 As explained above, the impact of demand driver change to retail market sales can be calculated by
multiplying a demand driver’s observed elasticity by that demand driver rate of change over a period of
time. Multiplying demand driver elasticity by forecast demand driver growth yields the percentage points of
overall retail growth that that specific demand driver is contributing to the market forecast under review.
 In addition, Euromonitor analysts estimate the impact of “soft drivers” to overall retail growth via their
empirical research. The relative impact and importance of “soft drivers” can be shown alongside that of the
measurable demand drivers identified by the Industry Demand Model.
 In the growth decomposition visual below, the percentage points of growth that each demand driver is
contributing to overall market growth are illustrated in the coloured segments of the stacked bar charts.

Significance and applications for growth decomposition
 By attributing a fraction of overall retail growth to each contributing demand driver, overall category growth
can be “decomposed”. In doing so, an extensive picture of underlying market fundamentals and processes
on a category-by-category and country-by-country basis can be provided.
 Ultimately, growth decomposition allows Industry Forecast Model users to:
 Identify different demand drivers that affect historic sales, and will likely impact future market prospects;
 Evaluate the relative importance of different demand factors over time and then identify which factors
generate the highest deviations in historic - and ultimately future - consumption;
 Illuminate the underlying market dynamics for each product category;
 Measure and predict the effects of demand driver shocks, either expected or hypothetical;
 Facilitate scenario analysis by generating understanding of which demand factors can be influenced by a
manufacturer or retailer and which are beyond their control.

Key applications for Industry Forecast Models
Quarterly forecast restatements

Regularly updated retail market forecasts to reflect the latest macro expectations
1 (eg quarter-on-quarter real GDP growth revisions) for all markets.
“What if?” scenario analysis

See and compare how a hypothetical event (eg Eurozone recession, China hard
2 landing, Brexit) stands to impact different market forecasts.
Growth decomposition and demand driver elasticities

Understand, compare and respond to the forces driving expected market growth
3 across different product categories and countries.
Assess market potential

See the ceiling on retail volume or value sales and growth, regardless of a specific
4 forecast scenario. How much more can that market really grow?

FOR FURTHER INSIGHT PLEASE CONTACT
María Mascaraque
Food and Nutrition Senior Analyst
maria.mascaraque@euromonitor.com
@MascaraqueMaria
https://uk.linkedin.com/in/mariamascaraque
RELATED ANALYSIS
“Free From” Food Movement: Driving Growth in Health and Wellness Space (Sep 2017)
World Health and Wellness Company Strategies Part I: Commitments (August 2017)
World Health and Wellness Company Strategies Part II: Growth Platforms (August 2017)
Certified Organic: Opportunities in Food and Beverages (July 2017)
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UNILEVER GROUP IN HEALTH AND WELLNESS

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 2

Key company facts

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 4

SWOT: Unilever Group

Strong brands Global presence HW tough to play in What is next for

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 5

A need to broad its portfolio in organics and free from

Unilever: Distribution of Sales by Category 2016

Organic Packaged Food

Naturally Healthy Beverages

Naturally Healthy Packaged Food

Fortified/Functional Packaged Food

Free From Foods

BFY Packaged Food

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 7

Unilever’s core category struggles

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 8

Sustainability at the heart of Unilever’s strategy

By Region FY2015 FY2016 15,000

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 9

Unilever growth in Q2 2017 is based on naturalness

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 10

The US leads Unilever’s sales

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 11

The Unilever Sustainable Living Plan at the heart of its strategy

Unilever’s three main goals

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 12

Innovation, sustainability and fight malnutrition lead Unilever’s strategy

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 13

Global Retail Sales 2017

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 14

General Wellbeing is the core positioning for Unilever

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 15

Unilever lags behind in the global HW market

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 17

Keep growing in free from and organic categories

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 18

Unilever loses shares across the board

 Unilever’s largest region in Health and

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 19

Competitive landscape for Unilever

 Within packaged food in

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 20

Competitive landscape for Unilever

 Within packaged food in

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 21

Boosting growth in emerging markets

 Germany is in second position,

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 22

Organic margarine and spreads the only bright star

 Unilever’s largest HW category is margarine and spreads, Hw Margarine and Spreads by

Retail value sales in 2017 (USD million)

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 24

Indonesia leads growth in FF margarine and spreads

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 25

MEA will drive growth in the coming years

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 26

Form Dairy-free and flavoured spreads to algae?

 Unilever is convinced on this movement as it has kicked off the long-awaited

© Euromonitor International HEALTH AND WELLNESS: UNILEVER GROUP PASSPORT 27

Naturalness and organic verities are key to succeed

performance in the review period. 8