2018 is barely 10 days old, yet, politically, socially and in most ways, it’s in full swing, propelling us into the future (or back into the past, depending on how you look at things) at an overwhelming speed. Life is more complicated and, as Unilever CMO Keith Weed recently told us, it’s the role of Unilever brands to help simplify things a bit.
This doesn’t make things easier for marketers. Just looking at how Unilever has pivoted into startup incubators and accelerators via its Foundry projects, as well as now having two working spaces, it’s a good example of how even ‘traditional’ FMCGs are adapting to this ‘chaos’ and change.
Weed also recently unveiled a new tool for marketers at Unilever, the 5C framework, which will help marketers create the stories and services that are useful to customers in this chaotic world.
With or without frameworks, Unilever also showed us recently that even the most sophisticated brands can get it wrong in this fast-paced environment, as Dove found a social campaign about diversity hit the wrong note with its audiences.
The Drum spoke to Keith Weed in Singapore at the end of 2017 to unravel what this all means to the FMCG giant, and the lessons learnt, as a new year begins.
You introduced the 5Cs framework recently, how does Foundry fit into that?
The 5C framework forms the backbone of our brand strategies, focusing our marketing on the pillars of: consumers, connect, content, community and commerce. It is Unilever’s framework to help our marketers navigate the changing landscape and build a really seamless on and off-line brand experience.
Unilever Foundry is one element of how we build these great, consistent brand experiences. We now operate in a far more disruptive, agile and responsive environment and as a result, we need to approach innovation from different angles - which is where Unilever Foundry comes in. We know that startups can help to drive this inspiration and as such, partnerships between the two are becoming more commonplace.
Unilever Foundry helps Unilever find partners across each of the 5 C’s. It is critical for marketers and brands at Unilever to keep the consumer as their priority. The role of Unilever's brands is to help make life simpler by cutting through the chaos, anticipating the needs of the empowered consumer. An example where Unilever Foundry assisted with this is through a partnership between Skip, the global laundry brand, and emerging French startup and laundry app, Cowash, by creating a sharing economy led laundry experience. The partnership makes laundry services available to a broader community and engages with a younger demographic of consumers through a digital solution.
The inclusion of commerce within the Cs feels important, how big of an opportunity is e-commerce for you?
The lines between marketing and e-commerce are becoming blurred, and building brilliant brand experiences is more critical today than ever. The shopping journey is no longer linear. We need to provide meaningful and frictionless experiences that resonate at any point in this journey, whether that be on or offline. We are looking at how we build relationships and drive consistency of experience and message through the key touchpoints. Increasing engagement on mobile means we need to curate content so that resonates with shoppers and that is clearly relevant to their need. This experience or interchangeability of in-store and online shopping needs to be seamless, so people can shop where and when they decide to shop on whichever platform they choose to do so.
Our e-commerce business is well over a billion euros, growing at 40%. We’ve seen consistent growth ahead of e-commerce markets for the past four years and are establishing a dedicated 800 people strong team that is driving e-commerce in 36 markets. We are building our capability with e-retailers like Amazon, Ocado and Tencent and advancing our capabilities with different models.
How does e-commerce change your direct-to-consumer proposition?
As we experiment with new business models we are building both our on and offline direct-to-consumer offerings.
Dollar Shave Club, as well as taking us more broadly into male grooming, gives experience of a very different direct-to-consumer subscription model, and a high level of one-to-one engagement with the brand and its growing product range.
Unilever Ventures has recently invested in Helpling, a leading platform for booking household services like cleaning, which follows a number of strategic partnerships with the platform including distribution of home care products to Helpling customers.
The other C that is interesting is content. Dove has had some wonderful content over the years but the recent issue with the re-cutting of the ad for social created an issue. What lessons did Unilever take from that in terms of content and consumer’s reaction to it in the digital space (or even community)?
As part of a campaign for Dove body wash, a 3-second video clip was posted to the US Facebook page which featured three women of different ethnicities, each removing a t-shirt to reveal the next woman. The short video was intended to convey that Dove body wash is for every woman and be a celebration of diversity, but we got it wrong. It did not represent the diversity of real beauty which is something Dove is passionate about and is core to our beliefs, and it should not have happened.
We have removed the post and have not published any other related content. This should not have happened, and we are re-evaluating our internal processes for creating and approving content to prevent us making this type of mistake in future. We apologise deeply and sincerely for the offence that it has caused and do not condone any activity or imagery that insults any audience.
Foundry, and more broadly Unilever’s courting of start-ups, is now at a level where it’s quite mature (and with Foundry 30 SEAA) increasingly global. What have been the big lessons for Unilever with this project?
Across Unilever, we are always looking for effective ways to engage and communicate with our consumers. We also believe in the power of innovation and collaboration to achieve our overarching objective of making Sustainable Living Commonplace. We believe that startups play an integral role in driving innovation within the sector.
When we started Unilever Foundry three years ago our challenge was how to open our doors to make Unilever accessible to startups, while at the same time leading that transformation. In the past three years, working collaboratively with startups has allowed us to invest in new ideas, taking calculated risks and experiment. We are continually learning to ensure our future collaborations are effective as possible
Startups have brought an agility to our working practices. We have developed and learned new ways of working, including procurement and payment practices, as well as trialling new ways of our brands to work in partnership with entrepreneurs.
Most recently, we conducted global research with brand managers and start-ups. ‘The State of Innovation’ global study looked at how the relationship between companies and startups will continue to evolve as Unilever Foundry continues its journey looking for exciting new partnerships. A key finding from ‘The State of Innovation’, was the prediction that startups and corporates will be working side by side in the same office by 2025 as startup and corporate collaboration evolves from an optional extra to an essential in the next five years.
Informed by ‘The State of Innovation’ global research, Unilever Foundry has this year launched two co-working spaces – LEVEL3 in Singapore with Padang & Co and Unilever Foundry Ireland with Dogpatch Labs, bringing startups and Unilever under one roof.
What has been the biggest changes in how Unilever operates, specifically within the marketing functions?
In just over three years, we’ve launched over 100 pilots, with two-thirds of our brands seeing an increase in revenue through the pilots and three-quarters generating above-average campaign engagement. In that time, we have become more agile, with more rapid innovation, and become more willing to take risks and experiment - a valuable evolution of how our marketers work.
We’re looking ahead to our next stage of innovation as we continue to pioneer with new technologies and ideas for our brands. Collaboration can no longer be viewed as an optional extra, it’s a strategic imperative.
Most recently, we announced 30 of the most ambitious startups and scale-ups to be part of the Unilever Foundry 30 South East Asia and Australasia to affect social, business and technological change in both developed and emerging markets. These 30 startups will also be based at our co-working space, LEVEL3.
How do you see the importance of Foundry etc changing for you in the future?
As one of the world’s largest advertisers, Unilever is always looking for more effective ways to engage with people. The pace of change in the marketing and advertising sector is moving at an exponential rate, and startups play an integral role in driving this. Unilever Foundry was created to help us continue to make our operations more efficient, and keep pace with that change. We know we have a massive opportunity - and responsibility - to pioneer the future. Unilever Foundry helps us to pilot and scale new ideas very quickly, and helps us to get to market with new innovations in a short space of time. This agility is critical to win in a world that is more hyper connected with consumers who expect hyper convenience from their brands, and we envision its importance will only grow in the future.
We believe innovation partnerships between corporates and startups are now becoming more recognised as invaluable sources of innovation – fuelling growth and providing pioneering solutions.
‘The State of Innovation’ global research found that in order to keep up with the accelerating rate of innovation in business, startup collaboration will become a necessity for corporates over the next five years, with around four out of five corporates (79%) and startups (78%) anticipating more collaborative work in the future. Unilever Foundry will take on an increasing role in our business as we continue to partner with external startups for innovative solutions.