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MANAGEMT 7044 Strategic Management

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Question

Read the article below from the newspaper according to a new UNILEVER group strategic decision: “Launch a new product” onto the market.

If you were the Marketing / Business unit manager of this company:
1. What kind of information you would analyze before launching this product to the market?
2.  Could you identify the analysis tools you would used in order to do it?

Unilever enters the gazpacho market:

After several years with a commercial strategy focused on the price and products (formats) adaptation to the consumer, UNILEVER food division in Spain -integrated by products in the environment and ice creams ('Frigo') - is immersed in a policy of capturing new trends and niches of the market This strategy has just been confirmed and reaffirmed with the launch of refrigerated gazpacho, under 'Knorr', the culinary brand of the group. The new line, integrated by the "original" and ecological recipe, is presented in Tetra Prisma container and one liter format. It is already sold at Carrefour at € 2.99 / unit and, according to Unilever sources, will be introduced at El Corte Inglés in a few days. The presentation includes the claim "Re-fresh recipes" and includes: "Ingredients 100% natural, suitable for vegans, without preservatives, source of fiber, gluten-free and made with 2.5% extra virgin olive oil". From Unilever he moves to Alimarket: "We have created a recipe that reflects the fundamental pillars of gazpacho, with 100% natural ingredients and 95.7% fresh vegetables, its richness in vegetables and fiber make it a true ally of the Mediterranean diet and health ".

New subsidiary for development and trampoline for Europe:

The gazpacho 'Knorr' has been developed in collaboration with the new company Papila, created last January and in charge of commercialization. This company has a capital of € 3,333, is managed by Eric Viviant and domiciled in Paseo de la Castellana (Madrid), in the group's offices in the capital. According to what Alimarket has known, the manufacturing and packaging of gazpacho 'Knorr' is carried out by Cordova's Comerandalus, focused on production for third parties. In this way, Unilever uses a formula that it already uses in our country for other items -such as ice cream, "Flora" cookies, Flora.pro.activ, etc.-, because the company has in our country only one factory, located in Leioa (Vizcaya) and dedicated to sauces and margarines.

The incorporation of gazpacho 'Knorr' is Spain is conceived as a springboard for its international launch. "We started with Spain, because it is the gazpacho country par excellence, but we will continue with the same recipe in other European countries, such as France, Switzerland and Benelux, and we want tourists who return to their countries to continue enjoying our gastronomy. through our products ", point managers of Unilever Spain. Therefore, Unilever has developed a product in Spain, under an international innovation policy. "We are in continuous contact with collaborators, such as Papila, to jointly co-create products that respond to the trends and needs of our consumers."

Knorr' returns to the line of refrigerated preparations:

The launch of gazpacho 'Knorr' marks the return of the brand and Unilever Spain to the line of cold-prepared products, spaces where before the crisis was present with the vegetable and fruit drinks 'Knorr Vie', line that came to harvest a remarkable sale and it was commercialized at European level.

The entrance of Unilever Spain in the category of gazpacho encloses, in this way, a bet for refrigerated food solutions and vegetable raw materials, in line with the healthy brand positioning that the company is reinforcing in 'Knorr', through its actions advertising, the recent launch of home-made wines and their commitment to CSR. The launch of gazpacho 'Knorr' supposes, in addition, a bet by one of the segments of refrigerated solutions of greater projection. In fact, its sale increases in the national retail at an annual rate of more than 10% - as was published in the last market report of Alimarket-, favored by the claim of healthy foods and the evolution towards the taste and quality of the own category. Thus, the gazpacho comes to complement the important business of 'Knorr' in ambient dishes, corresponding to vegetable creams in brik -segment that leads the brand-, soups in brik, broths in pill, dehydrated soups, instant soups ('Cup a Soup' ') and the' Pot 'dishes, added in 2015. The incorporation of this last line -increased in 2017- marked the beginning of the new launch path for Unilever Spain in the food market, a process that has included the presentation of references of margarine healthier; organic Hellmann's mayonnaise; the incorporation of frozen cakes, in alliance with Palacios Alimentación; and the presentation in Spain of ice cream 'Breyers', less caloric.

Income of € 607 million in 2017:

With the arrival of the economic crisis and the closure of its detergent and softener factory in Aranjuez (Madrid), in 2012, Unilever España's business was reduced to the level of € 600 million. In 2016, the turnover amounted to € 616 million and in 2017 it was € 607 million, which is still slightly higher than the revenues of 2015 (€ 604 million).
The divisions of food in the environment, 'Frigo' and HPC (home and personal care) still represent around one third each of the group's turnover in Spain. This business and activity of Unilever in our country will be cut next July, when the transfer by the Dutch group of its margarine division (BCS) to the KKR fund materializes. In this way, Unilever España will be stripped of one of its strongest market leadership, as its brands 'Flora', 'Tulipán', 'Ligeresa', 'Artua' and 'Natacha' add up to a 70% market share. margarine. Globally, Unilever is also involved in a program to end the group's bicephalia, made up of the Dutch Unilever, NV and the English Unilever PLC. The restructuring will involve the integration of business in a new parent company, New NV.
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