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External Assessment
Although Unilevers Path to Growth strategy involves all components of the general
environment, two segments that are especially relevant are the global and sociocultural
segments. A major strength of the companys global environment is its geographic
diversification of its major product markets. In 2003, Unilever had sales and marketing
efforts in 88 different countries. The key is that it gave decision-making power to its
managers in different countries so that they could tailor their products to the markets
specific preferences and consumers local tastes. Thus, it was the cross-country preferences
of consumers that determined what products Unilever would carry. The global segment
provides an enormous opportunity for Unilever. The case states that emerging country
markets show the greatest potential for sales growth. Major competitors such as Procter &
Gamble and Kraft Foods had sales in roughly 140 to 150 different countries in 2003, and
Nestle, Unilevers main rival, had market penetration in almost every country in the world.
If Unilever is able to expand its operations into 50 or more new countries and concentrate
its advertising campaign on consumer preferences, it could significantly increase its
market share in the global economy.
Another important piece of Unilevers general environment is the sociocultural segment.
One of the companys founding values is understanding and improving consumers lives. A
major strength of Unilever lies in its ability to anticipate consumer trends and demands and
then cater to their needs. For example, market research indicated that nutrition was the
number one concern in the United States, Germany, and the United Kingdom, and that
weight was the number three concern. The focus of peoples attitudes became living
healthier lifestyles. To move with the trend Unilever acquired SlimFast. SlimFast was the
U.S. market leader in the weight management and nutritional supplement industry, with a
45% market share. The acquisition seemed promising in the beginning. Approximately
94% of SlimFasts sales were in North America, which presented a huge opportunity to
diversify into foreign markets such as Germany and the United Kingdom. Unfortunately
the healthy lifestyle that people pursued became a threat to the future success of the
company when Dr. Atkins came out with his low carbohydrate craze. The case presents no
information about Unilevers response to this issue.
Unilevers industry performance is determined by all of Porters Five Forces of competition,
however it is especially sensitive to the rivalry among competing firms and the bargaining
power of buyers. Unilevers main competitors are Nestle, Procter & Gamble, Kraft, Groupe
