Unilever is chasing 40 per cent growth in online sales this year as it quickens efforts to build direct relationships with shoppers that have traditionally been facilitated by retailers.
The FMCG business has waded warily into the e-commerce channel in recent years but is now making a more concerted push to try and unearth new business models.
Like its peers, Unilever’s marketing is leaning on cheaper, more targeted digital-led strategies to facilitate the shift and a stronger handle on online sales is seen as a way of gleaning the crucial customer insights needed to realise the plan.
The sales target spans desktop and mobile. While pushing product is a key part of any e-commerce play, Unilever has repeatedly said it sees it as a way to also understand how customers are moving between virtual and physical channels. It launched a hackathon last year to hunt for start-ups that could help it gain this insight with successful applicants receiving $50,000 to fund a pilot.
Unilever joins Diageo, Mondelez, AB InBev and several other FMCG companies ramping up e-commerce this year. Mondelez’s vice president of global media and consumer engagement Bonin Bough has been tasked with overseeing its digital shopper plans, while Diageo hired a general manager earlier this year to steer its efforts in Europe. Meanwhile, AB InBev has been experimenting with direct selling on mobile. Online sales are tipped to hit $17bn by the end of 2016, according to Kantar Worldpanel.
The Marmite maker will be hoping its own online sales push works in tandem with updates to its pricing and strategies to capitalise on its strong start to the year. Revenue jumped 2.8 per cent year-on-year in the first quarter and was up 5.4 per cent in emerging markets, driven by price increases in countries such as China and India offsetting ongoing struggles in Europe.
Mastering online sales, particularly on mobile, could also ease its recent woes in emerging markets like China where consumers are known for their propensity to buy from their devices.
Paul Polman, chief executive officer of Unilever, said: “We have had a good start to the year, helped by favourable currency movements but also an improvement in underlying sales.
“This is despite a continued challenging trading environment in many parts of the world. The actions we have been taking to put us on track for higher levels of growth are starting to pay off. We have further strengthened the innovation pipeline, and are increasing investment behind the core of our brands, as well as extending into premium segments and new markets. We continuously strengthen our go-to-market capabilities and sharpen our execution.”