Innovations and sustainability are at the heart of growth. That's why Unilever is integrating both into its business strategy. Paul Polman, chief executive officer of Unilever Plc, says he is happy with the progress in driving the company's sustainability agenda in Bangladesh and this has contributed significantly to the strong growth of business here. Polman spoke to The Daily Star in an email interview to give an overview of Unilever's strategy and the positive contribution being made by markets like Bangladesh to its global business growth.
The Daily Star (TDS): For nearly two and a half decades, Bangladesh clocked about 6 percent growth and the economy is expected to maintain similar or higher growth in the coming years. How does Unilever interpret the growth trajectory? What prospects do you see in Bangladesh and what are your future plans here, especially in addressing the needs of upmarket consumers?
Paul Polman (PP): Developing and Emerging (D&E) markets are the key driver of growth for Unilever and markets like Bangladesh have contributed positively to the company's growth momentum. Bangladesh represents a long-term growth opportunity for us and we are fully committed to our business here. Increasing salaries, younger population and growing middle class indeed provide a high growth potential for a business like ours.
The per capita consumption (PCC) of most of the categories that we are present in is lower in Bangladesh than other D&E markets. For example, the PCC of face wash, skin cleansing and the shampoo category in India and Pakistan is approximately double that of Bangladesh. There is significant headroom for growth in those categories.
Our strategy for growth in a market like Bangladesh is to straddle the consumer pyramid and invest to grow in all the segments from the mass market to the premium segments. For example, in the fabric wash category, we have Wheel for the mass market, Rin for mid-market and Surf Excel for the premium consumer segment.
TDS: Bangladesh's expanding economy has created a burgeoning middle class and sped up urbanisation, which many believe, fuels demand for fast moving consumer goods (FMCG). As the biggest FMCG company here, what's your take on this?
PP: Unilever operates in over 100 countries across the world. We have seen this trend of a burgeoning middle class and urbanisation driving market growth in several D&E markets.
In Bangladesh, we have seen the transformation as people's income grew and they began spending more on hygiene and personal grooming products. As a company, which specialises in such products, Unilever has helped the Bangladeshi consumers make safe and the best choices.
We have also helped change consumer behaviour through our initiatives under the Unilever Sustainable Living Plan. The Lifebuoy Lifesaver programme, for example, helped teach hand washing techniques with soap to almost 18 million people in Bangladesh. At the same time, Lifebuoy has enjoyed rapid growth as more and more people started investing in hygiene products.
TDS: With prolonged focus on home-to-personal care products in Bangladesh, Unilever also entered the beverage (tea) and food (Knorr soup) markets. Give us some insight into these two markets.
PP: The packaged foods business in Bangladesh is in a nascent stage. With urbanisation and increasing incomes, we expect this segment to grow strongly. We see this as a big opportunity for growth as Unilever has a big food business globally with established brands and significant expertise. As has been our strategy, we have leveraged our global portfolio and innovations to serve the local consumers. Our foray into the tea segment with Taaza and soup segment with Knorr is in line with this approach. We have received a good response from consumers and hope to build on this.
TDS: Unilever has been in Bangladesh for several decades now. What changes have you seen in consumer behaviour, and what factors influence consumer sentiments the most here?
PP: With the economy growing strongly over the last few years, we have seen a clear trend of urbanisation and increasing propensity for consumer spending. The consumer sentiment is positive, which augurs well for the future. Consumers are increasingly spending on products and services that provide convenience and high order value benefits. This is reflected in the growth of packaged foods and personal grooming segments.
TDS: Unilever is one of the most in-demand employers, according to Linkedin. Why do people prefer Unilever to other companies as an employer?
PP: Unilever has been recognised as the most preferred employer in over 22 markets. The Linkedin recognition is another heartening endorsement of our employer brand proposition.
It is indeed a matter of pride for us that talent sees Unilever as a preferred employer. Our culture of leaders building leaders, and providing big responsibilities at an early stage are some of the key distinguishing factors of Unilever's employer brand proposition. We have constantly added to these to make our proposition more current, while ensuring that we remain true to our values. Our efforts to increase agility, inclusion and diversity in our workplace resonate well with the aspirations of the youth and this in many ways has helped to increase their preference for Unilever.
What attracts talent is finally the underlying purpose that drives a business beyond just profits. Our purpose at Unilever is to make Sustainable Living commonplace and the Unilever Sustainable Living Plan (USLP) brings this alive by embedding sustainability in our business. The USLP is a key differentiator for Unilever with young talent as it connects with the aspirations of the youth today to make a positive difference to society and the planet.
TDS: Over the years, business processes, management styles, marketing concepts and strategies have been reshaped. The internet and smartphones have popularised e-commerce and e-marketing. How has Unilever adapted itself to this trend?
PP: This is indeed the digital age. The growth of digital technology and social media is shaping almost every aspect of our life, including the way we work and how we engage with our consumers. Globally, this is a key focus area for us and we have built critical capabilities. We have strong global partnerships in place, even with leading companies in this space such as Google, Microsoft and Facebook. We will definitely bear these capabilities in each of our markets to win with our consumers. We are already doing this in many of our markets, such as India and Bangladesh.
The Kan Khajura Tesan Campaign (where cash-strapped and entertainment starved consumers were provided with popular and the latest entertaining content upon placing a missed call from their mobiles) was a huge success this year and portrays our innovation in using digital tools in the D&E Unilever markets. Most of our brands have similarly engaged with consumers through social media. Digitalisation is now an integral part of designing campaigns for brands. Over time, growth of investment in these new platforms has been significant and it will continue to grow faster than traditional media.