Unilevers Marketing Department - Essay Example

? Topic: Operations of Management: Unilever’s Marketing Department. Table of Contents: Management Operations management Organization: Unilever: a) Introduction b) Marketing Department c) Role of Marketing Managers d) Marketing activities e) Branding f) Marketing Strategies g) Comparison of Unilever and P%G Conclusion Management: Management is necessary for any organization. Without clear and effective management, a business is going to lack a sense of control and direction. There would be no co-ordination between different departments, leading to wastage of effort and time. Employees are controlled and supervised with successful management. Management also leads to better organization of resources, resulting in higher output and sales. Apparently, the firm will drift and eventually fail and the business cannot succeed without the much-needed management. The basic roles of management involve planning, organizing, coordinating, commanding and controlling. Management involves taking risks and requires critical decision-making regarding strategic, tactical or operation matters. Operations Management: Operations management is a branch of management which deals with supervising, designing, and redesigning business operations when producing goods and services. Its main purpose is to be as productive efficient as possible by using as little resources needed for the production of goods and services. It is responsible for being effective in meeting customer requirements. The process of converting inputs into outputs comes under operations management. (Borrington, Stimpson. 2006) Operations management helps to increase the substance of value-added activities in any process of the business. But for optimal enterprise performance, a business must co-align these value-adding activities with possible marketing opportunity. It is mainly concerned with the technical functions of a business like the development, production and manufacturing of goods and services. What we are going to look into the operations of management of Unilever Company’s marketing department. Generally, the management in the marketing department involves doing market research into existing or new markets in order to identify new market opportunities. It is responsible for planning new products, working closely with the research and development and production departments. It has to decide upon the best marketing mix for each and every product and make sure that this is put into effect. It will keep records of the sales of each product/service so that decisions can be made about extensions strategies or taking products off the market. A business will fail without effective marketing. The marketing managers have an important role in meeting customer requirements. Organization: Unilever. Introduction: Unilever is a giant multinational with its headquarters in London, and operating companies in many countries of the world for example Switzerland, Germany, Saudi Arabia, Pakistan and India, to name a few. It was first established in 1930 when Lever Brothers of UK and Margarine Unie of Netherlands merged. Since then it is providing consumers with the best of hygiene, personal care and nutrition products all over the world. The Marketing Department: In Unilever most of the decisions are made by the Upper Management and they make decisions regarding the marketing of their products like advertising and promotion. It has such a vast size because of the fact that it is a multinational, that organizing is probably the most critical of all functions of its management. It is important that their employees are motivated and inspired to work efficiently and make sure that all departments are working according to their goals and instructions assigned to them. All the progress has to be evaluated to increase the output and results and overcome any conflicts and problems. The role of marketing managers: The marketing manager of all Unilever companies has to perform many interpersonal roles of which, liaison is the most important. He has to act as a leader and an inspiring figure for all his workers. To maintain and evaluate the performance of his department effectively, he gets updated information, out of which he has to give marketing reports to the senior management. It is his responsibility to circulate and provide information regarding marketing issues to the senior managers who then looks into the matter. Unilever is a multinational and they require their managers to have a standard skill level to perform the necessary tasks. The marketing manager need to have the three essential skills; technical, human and conceptual to make the decisions regarding the marketing strategy and promotion of their products. For any marketing manager, human skills are of utmost importance because they have to interact with all kinds of people in the marketing world to improve the goodwill of the company and its goods. Communication with employees is also vital to motivate them for efficiency and effectiveness in output. Marketing activities: Marketing is not just advertising, promotion and selling. It is the management process which identifies consumer wants, anticipates their future wants and then goes about satisfying them profitably. Marketing activities include the development of a product or service, finding out what sort of customers might buy the product, what packaging should be used, what price should be charged and the appropriate place to sell it. Marketing usually means going out and finding what consumer requirements through market research are because if the consumer is not satisfied, products will not be sold and the business will be unlikely to make any profits. The extensive research made into studying marketing and its strategies has helped the consumers make more informed decisions. If the marketing department is successful in identifying customer requirements and predicting future customer needs, it should enable the business to not only increase its sales revenue, profitability and market share but also to maintain and improve the image of its products and bring variety and innovations to existing ones to facilitate the consumer at the end of the day. Marketing activities are devised in a manner catering to different cultural and social factors that influence the consumer buying pattern and decisions. Every society is categorized into different social classes and cultures. Therefore marketers segment the market into such groups and market accordingly because the buying behavior of one social class and lifestyle is different from another. Marketers tend to market products according to attitudes and behavior as well as roles and status (Kotler, 2006). We will observe the development and forces that are altering the marketing scene of how Unilever are marketing strategy and the operations of management in that department. The product itself is probably the most important element in the marketing mix. The product must fulfill a want. Consumers buy products for pleasure, satisfaction or benefits they provide. If it does provide the satisfaction, the good will not be purchased. Informed and aware customers will pay a price that is worthy of the quality of the product. The design that is the performance, reliability and quality should all be consistent with the product’s brand image. The marketing should be capable of stimulating new wants from the consumers. It must give something very distinctive that makes it appear different to encourage brand loyalty and Unilever has managed to gain brand loyalty of its various products like Lux, Surf Excel, Lipton, Blueband, Wall’s, Sunsilk, Close Up etcetera. Their well-known brands are trusted everywhere by consumers and someone, somewhere chooses a Unilever product 150 million times a day. They try to keep their pricing strategy such that it should provide good value for money to consumers. They will not unnecessarily pay a high price for a good of low quality or which serves no purpose. Consumers are in search of best deal for money for example, economy packs, bulk-buying and discounted products. (Titley, 2008) Packaging is another part of marketing mix that influences consumer decisions. Consumers consider suitable packaging because it has to give protection to the product and not allow it to spoil. It also has to allow product to be used easily. It is no good having hair shampoo in a tin that would not allow the liquid to pour out easily. Getting the best value for money is what any rational consumer would want. Advertising as part of marketing and promotion will influence consumers to quite an extent. Advertisements which give information to the public are known as informative advertising. It increases consumer choice by making consumers aware of the range of goods and services available to them. While persuasive advertising is designed to create a want for a product that consumers would not necessarily buy. It is vital that any such advertising must not be racist or sexist on any way and must not make meaningless statements and convey the right message to the buyer. The target audience or the potential buyers of any product or service are informed and made aware of the product through various means like television, radio, newspapers and magazines, posters/billboards, cinemas, leaflets, direct mail as well as promotions such as price reductions, gifts/free samples, competitions, point of sale display and personal selling. All of these aims to serve the purpose that consumer continue buying that product instead of a competing brand. Unilever’s branding: Unilever makes an effort to take celebrities in their advertisements to endorse the products. This tactic further attracts and influences consumers to buy their product. Bollywood actresses like, Ashwariya Rai and Katrina Kaif have been the brand endorsers of the soap called Lux. They are usually liked by the younger audience. Not only that, they try to keep such an advertising strategy in all countries that they operate in with their local celebrities and other significant people of all fields. Unilever’s Marketing Strategies: Companies today, try to focus on the increasing their profitability and the marketing units make every effort in gaining brand loyalty of customers. They want more and more people to buy their products instead of a competing one to gain a larger share of the market. Marketing strategies are designed for the strategic development and growth of business to enter into emerging markets (Bang and Sharad, 2008). Emerging markets have immense power and growth potential and they make up about 15 % of revenues to multinational companies like Unilever. Unilever itself want to enter the emerging markets of Asia and Europe as they have wide range of products ranging from soaps and detergents to biscuits Baloch, Shankar and Schaus, 2007). Unilever have taken up the new mantra of ‘Think Global, Act Local’ where they devise flexible marketing strategies for the marketing of their products in the remote areas of emerging markets. They do this in order to compete with other brands in terms of prices and uniqueness. They mainly practiced this strategy in the villages of Indonesia which helped them make higher profits in developing countries and benefitted from economies of scale due to lower costs. Moreover, they aim to cater to more diverse segments of the market in the developing countries where there are other popular competing brands of the same kind of product. For example, if we talk about detergents, then Wheel is a highly consumable and inexpensive brand of India, but Unilever challenged its market share by launching a little expensive detergent called, Surf to cater to the upper class of the market who can easily afford it. Hindustan Lever, a subsidiary of Unilever in India, practiced this strategy to launch distinct brands of products catering to different segments of market to gain a higher market share than the domestic brands. This way they acquired nearly 35% of market share in the laundry and detergent segment only (Baloch, Shankar and Schaus, 2007). Unilever adopted a step-by-step marketing strategy in the diversified market of China. It was a distinct marketing approach of segmentation in accord with different Chinese markets. They formed associations with the local Chinese companies to enhance the sale of consumer goods existing in the market. Unilever only launches global brands when they have a local company to popularize and publicize the particular brand, for instance, the launch of Omo brand in china. The local host company helped Unilever to improve the quality and quantity of their products as they believe that growth in the Chinese economy should be triggered by Chinese people only and not foreigners. Unilever implemented a marketing strategy in India by increasing its consumer base through a direct marketing project called ‘Shakti’. It was meant to improve the wealth of their consumers in rural India. They asked poor rural women to directly market their products to consumers. The company increased its profits due to a larger consumer base and the marketers also became their loyal consumers (Guar, 2006). The strategy concentrated on the establishment of willingness and ability amongst those people who are customers and also those who are not and represent a low average rate of Unilever’s products. Unilever adopted another marketing tactic in the detergent sector this year by focusing on the master brands like Wisk, All and Surf. They aim to double the budget of ‘All’ to about $28 billion as compared to $9 billion last year, and extending their line of powder detergents. Already the sales have boosted in the beginning of the year. Side by side they plan to roll a detergent tablet of Surf for the first time and a Wisk tablet for the second time. They are doing this as they want to challenge the value brands which are getting increasingly popular in the global economic recession of today, as reported by a company rep. In reaction to this, Procter & Gamble is also a launching a Tide tablet. Unilever’s Global Home Care Market Share. Source: (Global Market Information Database) They plan to launch a new detergent for babies called, Baby Care Plus, in July 2011. They are getting $8 million of marketing support of this product. $5 million will be spent on print advertisement and the rest for direct selling and physical outreach. They have already promoted the product as being clinically proven and safe for babies clothing. It is also dye-free with stain lifting formula. Comparison of Unilever and Proctor & gamble Marketing Strategies: Unilever’s and Procter & Gamble have a strong rivalry even in their marketing strategies. Both have announced to come up with detergent tablets and both are ready to offer bleach extensions. One is called Wisk Color True Bleach Action Tablets and P&G has its Tide rapid Action with Bleach. Furthermore, Unilever will also launch tablets for Surf which will have a comparatively low price than Wisk. Unilever has seen tremendous ups and downs in its marketing success over the last 5 years. Their 5-year strategic plan of ‘Path to Growth’ aims to cut off Unilever’s ‘tail’ brands and focus more on leading brands for increased market share for all its products, as too many brands confuse a customer in his buying behavior. 1200 smaller brand names will have to be curtailed and thousands of jobs lost. Eventually production facilities will also have to be closed down. But the sale of top line brands will improve which contribute to about 90% of their annual turnover. This will lead to an annual growth in earnings per share. Unilever has appointed Amaze, a European marketing and technology company, for global website support on 5th April 2011. Amaze will help them build a digital presence worldwide as it has the support of 68 websites across 104 countries. Unilever will have a global business operation by having centralized brand content instead of just localized content of every individual market. Amaze will offer project management, training and technical support at all times to all team editors. There would be a strategic coordination and implementation support for Unilever’s operations. Unilever wants to build strong global implementation and management for themselves to achieve global goals and this can only be possible with a consistent global digital presence. Both the companies are looking forward to this challenging project. Conclusion: Unilever constantly comes up with distinctive and well-researched marketing strategies to make its presence felt in the market. 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