Unilever's Branding Strategy: Sustaining Excellence in a Global Market

Question

Task: How does Unilever pursue a worldwide branding strategy in a cutthroat market while skillfully navigating brand crises and upholding brand equity?

Answer

1. Introduction

1.1 Background and History

Unilever started its operations in 1929 through the agreement deal between Margarine Unie and Lever Brothers (Unilever, 2023a). It was formally established in 1930 and started experiencing competitive rivalry from another FMCG brand P&G. Unilever has emerged as one of the largest consumer goods companies worldwide established 100 years ago (Unilever, 2023b). Its brands are serving around 3.4 billion people everyday across 190 countries. Unilever employs around 127,000 individuals from various parts of the world. It consists of five business segments, namely, products of personal care, nutrition, ice cream, wellbeing and beauty and home appliances (Unilever, 2023b). Here, the company has been maintaining sustainability throughout the entire business model.

1.2 Vision and Mission

Unilever possesses a clear vision of emerging as the universal leader operating a sustainable business of consumer goods (Unilever, 2023c). On the other hand, its mission is to ensure that sustainable living choices are offered to all individuals through superior, first-class and groundbreaking products and services.

1.3 Functional and Emotional Values

Unilever satisfies the functional needs of customers through its high-quality, innovative, sustainable and superior products and affordable prices (Unilever, 2023b). These product ranges include beauty and wellbeing, home care, personal care, nutrition and ice cream. It also ensures a strong product and price proposition by providing right product at right places with the right price for offering these functional values to the customers (Carroll, 2023a). On the other hand, Unilever helps in catering to emotional values by boosting self-esteem and wellbeing of the customers with the help of its valuable and purposeful advertising campaigns and brand programmes (Unilever, 2023d). Thus, strong marketing communication strategies are undertaken here for satisfying emotional values.

1.4 Objectives

The aim of the report is to critically evaluate brand management strategies of Unilever by using various theories and models. Here, brand strategy, brand equity, brand positioning, consumer behaviour, advertising and navigating brand crisis have been discussed.

2. Branding Strategy of Unilever

2.1 Global Branding Strategy

Global branding strategies are essential for multinational FMCG firms like Unilever for enhancing customer awareness, gaining more consistency, reducing marketing and production costs, acquiring economic stability, improving brand value and optimising profits (Steenkamp, 2017). These strategies help in creating a brand image consistent in markets across the world.

Unilever undertakes various branding strategies based on the different marketing mix elements, which are product, price, promotion and place. Its common global strategy is to provide a sustainable living commonplace to all consumers by anticipating and responding to changes shaping people’s lives (Unilever, 2023c).

Table 1: Unilever’s Global Branding Strategies Across Marketing Mix

Product	Unilever has a high growth product portfolio consisting of different ranges, such as, wellbeing and beauty, ice cream, personal care, nutrition and home care (Unilever, 2023c). It ensures delivering superior products through constant innovation. However, customers’ feedback needs to be included here for modifying products and enhancing services.
Price	Unilever has been adopting an aggressive pricing strategy for responding to inflationary pressures across the world (Jefferson & Carroll, 2022). This has been for protecting its profits and investing in long-term health of brands. However, it can also result in losing customers if prices becomes unaffordable for them.
Promotion	It undertakes advertising and promotional strategies to inform customers about its products benefits and innovations alongside engaging with them on important issues (Unilever, 2023e). Despite this, Unilever has received criticisms for using sexism and gender stereotypes in its ad campaigns.
Place	Unilever has been focusing on key growth markets for attracting customers (Unilever, 2023c). It has also been utilising e-commerce channels and undertaking innovative routes for marketing and delivering products. However, it has been facing increased competition in the e-commerce market.

3. Brand Management

3.1 Brand Identity, Image and Personality: Aaker Model

Brand identity includes the intricate design system consisting of visual and content choices of a brand (Keller & Swaminathan, 2020). Unilever’s logo creates a visual representation of the brand by showing its commitment towards ensuring sustainability for all communities, customers and living beings. It consists of several symbols depicting the core purpose and business meaning, thereby creating the big blue “U” brand character (Unilever, 2023f).

Fig 1: Aaker’s Brand Personality Model

Unilever also maintains a positive brand image in the customers’ minds through ensuring sustainability across the entire business (Unilever, 2023c). However, this brand image was tarnished when it faced backlash for its gender stereotyping and sexist advertising campaigns alongside promoting harmful beauty standards. Based on the Aaker’s model of brand personality, the firm uses sincerity personality to display its kindness and thoughtfulness in running the business by using its core values, caring for workers and communities and ensuring environmental sustainability (Ahmed & Jan, 2015).

3.2 Functional, Emotional and Social Values

Unilever helps in providing emotional, functional and social values to the customers through its products and services. Customers gain functional values from superior, innovative and high-quality products while emotional values are gained from advertising campaigns enhancing self-esteem and wellbeing of customers (Swimberghe, et al., 2018). In addition, social values are provided through extensive focus on sustainability and addressing social issues.

4. Brand Equity

4.1 Consumer-Based Brand Equity CBBE): Keller Model

CBBE provides relevant and valuable information about the ways customers use for attributing values to numerous brands depending on their own insights, assumptions and experiences (Christodoulides, et al., 2015).

Fig 2: Keller’s Model of Brand Equity

In this regard, Keller’s brand equity pyramid can be used for evaluating branding management strategy of Unilever. The model comprises of six elements, based on which the brand equity is analysed (Keller, 2016). Along with these, four different stages occur that are brand identity, brand response, brand meaning and brand relationships.

4.1.1 Salience

Unilever uses various advertising and marketing strategies for enhancing brand awareness through transparent and open communication with the customers (Unilever, 2023e). These activities are used for bringing behaviour change and informing customers about products and services. Utilising digital and online ads have also contributed towards significant brand awareness about the company (The Trade Desk, 2022).

4.1.2 Imagery

Unilever’s big blue “U” logo comprises of 25 symbols, each of them displaying the vitality mission and sustainable living purpose of the brand (Money Control, 2020). Each of its five business categories also contribute towards addressing both environmental and social needs of the customers. In addition, its high-quality and superior products and packaging fulfil emotional and psychological needs as well. However, maintaining positive brand image is difficult in this current business environment.

4.1.3 Performance

Unilever ensures product safety by removing use of harmful ingredients and using preservatives for protecting the products from bacteria, yeasts and moulds (Unilever, 2023g). Customers can discover the ingredients of used in these products. In addition, innovation is ensured in all product ranges, thus, leading to superior performance. Despite this, it faces tough competition from new firms and e-commerce brands in the global market.

4.1.4 Feelings

Unilever develops a strong and eloquent resolution of sustainable living through its products, services and operations. The firm communicates this message to its valuable customers over different platforms that help in producing strong psychological responses, creating brand fame and driving memorability (Unilever, 2017).

4.1.5 Judgments

Unilever considers the judgments of its customers for bringing changes in its branding. For example, it removed its sexist and stereotyped ads to eradicate gender depictions in 2016 with women’s dissatisfaction (Sweney, 2016). The company also used rebranding strategy for its ‘Fair & Lovely’ skin lightening product in India by renaming it to ‘Glow & Lovely’ after receiving criticisms (McEvoy, 2020).

Fig 3: Bran value of Unilever from 2012 to 2021 across the globe

4.1.6 Resonance

Unilever uses pioneering technologies and data analytics for retrieving information about purchasing behaviours, consumers’ tastes and preferences and buying patterns. This enables the company to cater to these demands with its innovative and superior products, thus building long-lasting relationships (Petruzzi, 2023).

5. Brand Positioning

5.1 Unilever’s Statement of Brand Positioning

Unilever places itself as the brand providing sustainable living commonplace for all customers and communities. It makes positive contribution towards planet and society by addressing several issues and improves customers’ lives through its high-quality and superior products, green promotional and distribution strategies and aggressive pricing (Unilever, 2023c). Here, vitality is used as the primary element in its brand positioning statement across its marketing mix strategies. This helps in creating a positive and superior brand image in the target customers’ minds (Cain, 2014). However, this needs to create a distinct image in their minds for being successful in enhancing brand loyalty and differentiating itself from competitors.

Here, Unilever maintains a competitive position in the international market by maintaining high product quality and focusing extensively on sustainability as compared to other rival firms.

5.2 Local Consumer Cultural Positioning (LCC)

Local consumer cultural positioning refers to a positioning strategy that focuses on associating a brand with the local consumer culture by reflecting various local cultural norms and identities, where products are perceived as being produced for the local people (Kostelijk & Alsem, 2020). Unilever uses this strategy in China through localised marketing and making innovations in the brands. This has been ensured by acquiring influential local Chinese brands, using local product packaging and remarketing and promoting local brand image of the company (Zhang & Fan, 2020).

5.3 Brand Communication

Unilever makes use of both traditional and digital media for its brand communication. However, there has been an increased use of social media platforms and digital media for advertising and communications. The firm has been using these platforms for social media marketing, ecommerce, search engine optimisation and others, which have helped in attracting potential customers and retaining existing ones (Reza, 2020). In addition, it has also been using omnichannel marketing strategy for its customers.

6. Consumer Behaviour

6.1 Brand Co-Creation

Unilever extensively focuses on co-creation strategy for engaging customers as partners in their product innovation practices. The firm and its customers engage in systematic interacting for learning and sharing information about their tastes, preferences and product expectations for integrating sources to create joint value (Van Dijk, et al., 2014). This has helped in reducing research and development costs of Unilever, increasing its product performance and relevance to the customers and expanding into new markets. This is because co-creation strategy helps in driving customer engagement and enhancing brand relationship with them by including their valuable inputs in product innovation process (Hsieh & Chang, 2016).

7. Advertising and Digital Marketing

7.1 Branding Strategies on Social Media

Unilever has been maximising the power of social media platforms for creating engaging content to inform customers about benefits of sustainable living (Askew, 2019).  This has helped in gaining several benefits such as strengthening customer relationships, easy interaction and engagement, understanding their needs, gaining brand awareness, accessing new audiences and supporting marketing actions (Tsimonis & Dimitriadis, 2014). However, it also provides the platform of giving negative reviews and feedback on the brands products and services, thereby hampering its image.

Its digital branding strategy focuses on developing conversational relationships with customers instead of using a brand-forward approach. This has provided a unique way of reaching out to the consumers and appealing to them based on purpose-led values (Gao & Feng, 2016). Unilever has also been leveraging its strong digital presence for enhancing brand awareness through marketing and advertising over these digital platforms (Askew, 2019). This has resulted in consistent high growth and increased sales over online platforms.

Unilever has also been making huge investments in digital marketing, media and ecommerce hubs. This has been helpful for ensuring data-driven marketing and sales for the firm by delivering seamless customer experiences and optimising investment (Caroll, 2023b). Despite inflationary pressures, it undertakes aggressive pricing strategy for using those funds to make investments for product innovation, digital marketing and focusing on e-commerce channels.

8. Navigating Brand Crisis

Unilever faced some criticisms that tarnished its brand image and led to a potential brand crisis. It has been questioned for promoting harmful beauty standards of whiter skin through its ‘Fair & Lovely’ product and criticised for some sexist and stereotyped advertisements. These made it essential for the firm to engage in rebranding and brand reinterpretation strategies by modifying such products and eliminating those sexist advertisements based on customers’ judgments (Jeon & Baeck, 2016). Thus, marketing activities were also undertaken for reinforcing positive brand associations and brand image in the target customers’ minds.   

9. Conclusion

The report aimed at evaluating the brand management strategies of Unilever. In this regard, various aspects of branding and brand management were considered. Its global branding strategy is undertaken based on different marketing mix elements. Unilever maintains a positive brand image and uses sincerity brand personality based on Aaker Model. It also has a strong customer-based brand equity that has been evaluated through Keller Model. Unilever maintains a strong competitive position by using local cultural positioning strategy in the market. It also uses various digital marketing and advertising strategies for reaching target customers. In addition, it uses brand co-creation and rebranding strategies for navigating brand crisis.