Unilever to stop force-fitting purpose in its brands: CEO Hein Schumacher

Unilever will no longer seek to "force-fit" all of its brands with a social purpose, CEO, Hein Schumacher, said.

In a recent update directed at investors, Schumacher, who took on the CEO position in July, announced Unilever's decision to discontinue the practice of imposing "purpose" forcefully on all its brands. While he reiterated the significance of having a purpose, he stressed the company's intention to pivot towards a more explicit emphasis on sustainability and purpose.

"Our focus on purpose is laudable and it inspires many people to join and stay with Unilever. So we must never lose it, but I don't think we advance the cause of purpose by force fitting it across every brand. But we will not force fit this across the entire portfolio, for some brands it simply won’t be relevant and that’s okay," Schumacher said.

While brands such as Dove, Lifebuoy, and Knorr under the Unilever umbrella have successfully incorporated their purpose to spur growth, Schumacher suggests that other brands might need to explore alternative approaches within the realms of social and environmental issues to better align with their distinctive brand identity.

This change in strategy stems from investor criticisms, particularly Terry Smith, a significant Unilever shareholder. Smith had previously voiced concerns about the company's excessive emphasis on sustainability in its product lineup, even when it might not align well with certain brands.

Smith expressed his skepticism about assigning a purpose to a mayonnaise brand, following comments made by the then Unilever CEO, Alan Jope, in 2022. Jope had declared that Hellmann's Mayonnaise was intended to combat food wastage.

During the call, Schumacher unveiled a shift in Unilever's marketing approach. Instead of dispersing investments among all of its brands, the company will now focus its marketing expenditure on its top 30 "power brands."

Unilever's revenue significantly relies on brands like Magnum, Dove and Hellmann's, which collectively constitute 70% of it. The company's objective is to allocate increased resources and capital to these specific brands, enabling a more targeted, cohesive, and digitally-oriented marketing strategy aimed at bolstering Unilever's growth prospects.

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