MKS0113

Unilever’s Digital Media Strategy

In 2002, Unilever introduced the AXE line of deodorant body sprays, primarily with an Internet-based promotional
campaign. Within 2 years, it became the No.1 male deodorant. Kevin George (Kevin), Unilever’s US vice president and
general manager of its deodorants division, credited this quick success to the changed corporate culture that actively
encouraged taking risks. He tells his teams to “take some chances. It’s very rare that we would put you in a position where
your decisions could bring down the company”.1 Since then, the company had been into digital strategy to launch its
products using a variety of new media channels. Again with the re-launch of Dove, its soap brand, in 2006, the company
scaled new heights in innovative marketing and advertising, and the efficient use of digital media.

Trends of Advertising Media and Changing Consumer Preferences

Advertising aims to pass on information about products and services, their use and place of availability through
channels like television, radio, movies, magazines, newspapers, telephone, video games, the Internet and billboards.
This media is even used by political parties, social groups, religious organisations, military and other non-profit
organisations, which do not strictly sell a product or service.
Advertising is generally considered to have begun with newspapers in the 17th century. But it is even more ancient.
Commercial and political displays have been found in the ruins of ancient Arabia. Sales messages, lost-and-found posters
were displayed using papyrus in Egypt, ancient Greece and Rome. Wall or rock painting is another form of ancient
advertising found in parts of Asia, Africa and South America even to this day. Such Indian rock-art paintings date back to
4000 BC. Handbills came during 15th and 16th century, with the development of printing. Advertisements to promote books
and medicines appeared in weekly newspapers in England in the 17th century, with simple description and price of
products, till late 19th century. Illustrations and colours were added later with technological advances. Newspaper advertising
grew alongside the expanding economies and businesses during the 18th and 19th centuries. The first advertising agency
came up in 1841. Since women were responsible for most of household purchasing, advertisers and agencies recognised
their role in advertising at the turn of the century. Radio broadcasts began in early 1920s, with ads in between the
programmes. Each programme started and ended with the mention of the business that sponsored it; later there were
multiple sponsors. In the late 1940s, advertising was massively disrupted by television that offered viewable programmes
with advertising slots. Television soon became a mass-market ad-format. Its position is being displaced by the growing
reach of Internet and mobile phones from past 2 decades. Apart from these, major commercial advertising media also
includes:
• Yellow pages, local newsletters and circulars, discount coupons, CD-ROM business cards, trade shows, direct
mail, promotional items with logo printed on them
• Sponsorship (such as buying uniforms for little league teams with company logo), sports ads (in the court or
field), telephone kiosks, in-store displays, religious organisations (church, synagogues, mosques)
• School or company yearbooks, outdoor aerial advertising (hot air balloons, blimps, and skywriting airplanes, and
airplane billboards), billboards (mobile or stationary), street furniture components, printed flyers and rack cards
• Cinema and movie screen ads, shopping carts, bus stop benches, human directional, town criers, interior and
exterior of buses, trains or airplanes, taxicab doors

1
Rasmussen Andrea and Ude Carolyn, “Kevin George: Unilever’s digital Media Strategy”, Strategy+Business, Booz Allen Hamilton, October 16th 2007

This case study was written by Abdul Samad Syed under the direction of R Muthukumar, IBSCDC. It is intended to be used as the basis
for class discussion rather than to illustrate either effective or ineffective handling of a management situation. The case was compiled
from published sources.

© 2008, IBSCDC.
No part of this publication may be copied, stored, transmitted, reproduced or distributed in any form or medium whatsoever without
the permission of the copyright owner.

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Sem III, Class of 2019-2021.
 MKS0113

Unilever’s Digital Media Strategy

• Roof mounts and passenger screens, musical stage shows, subway platforms and trains
• Elastic bands on disposable diapers, stickers on apples in supermarkets
• The opening section of streaming audio and video, posters, and the backs of event tickets and supermarket
receipts and word-of-mouth.
The selection of advertising media has a major influence on people’s preference of media and entertainment. In
1925, for example, the main advertising media in the US were newspapers, magazines, signs on streetcars and
outdoor posters. But by 1998, television and radio became major ad-media. The people’s choice depends on how
attractive the media is. Guerrilla promotions is a new innovation and involves unusual approaches such as staged
encounters in public places, product giveaways and interactive advertising where the viewer can respond to become
part of the advertising message. A trend of interactive and embedded ads – such as product placement (Omega
watches, Ford, Vaio, BMW and Aston-Martin cars are featured in recent James Bond films), consumers voting through
text messages, social networking sites – has begun. Other media such as the World Wide Web are overtaking television
because of more consumers using the Internet.
Studies show that the biggest growth for the next 10 years will come from the digital media. Advertising expenditures
of companies are increasingly shifting from traditional media like TV, radio and newspaper to the new emerging digital
signage2 . Lowered capital expenditure on signage software and, advancement in content and delivery methods are
the major factors driving this shift. According to a research report, digital signage market is expected to reach $13.6
billion and alternative advertising’s market share will rise to 27.7% by 2011.3 The cultural shift in the use of media for
entertainment, news and information also is a major cause. The Internet and other applications tied to it have
propelled this change, drawing attention of young consumers. Targeted advertising models like that of Google Inc.,
Yahoo Inc. and Microsoft Corp.’s MSN are readily embraced by consumers and has curbed growth of old media.
Outsell Inc., an information industry research firm in Burlingame, California conducted a survey about ad-spending
and found that online advertising has surged 19%, search engine ads by 26% in 2006; whereas growth of print ads
is estimated at 2% and that of radio and TV, a mere 2.4%. It estimated that Internet is used by 80% of advertisers,
with a 90% adoption rate by 2008.4
Along with the convenience of reaching consumers directly, the Internet offers various options of online advertising
like banner ads, banner exchanges, ad-networks and interstitial (pop up) advertising. The results of a survey in 2007
by ADZ Media5 reveal that online advertising is up to four times6 more effective than traditional media advertising. In
a poll conducted by IBM, advertising professionals expect that by 2012 online advertising would take 30%7 of revenues
from traditional broadcasters and media. Along with the global companies, the local companies are also catching up.
The Wall Street Journal notes that web companies have highest share (43.7%) of the $8.5 billion local online-ad
market in 2007; while newspaper companies had a 33.4%. A report titled 2008 Outlook: Local Online Advertising by
Borrell Associates8 expects a 48% increase in local online ad-spending in 2008, making it a $12.6 billion market.9
Local search and online video advertising will be driven by their popularity and will more than double by 2009,
to $5 billion, while locally placed online video will triple, to $1.3 billion.10 The ever-increasing popularity of online
advertisements serves as a warning bell for traditional media companies such as yellow pages publishers, cable
companies, newspapers, radio stations, TV stations, etc.

2
Digital signage is the display of ads in the digital format using programmed software and screens.
3
“Narrowcasting: Outperforming Traditional Advertising”, http://www.belwo.com/Narrowcasting.pdf
4
Weisman Robert, “Virtual ads pose real threat to traditional media”, http://www.boston.com/business/articles/2006/02/12/virtual_ads_pose_real_threat_to_traditional_media/?page=1,
February 12th 2006
5
ADZ Media is a leading design and web agency, based in Whitefield, Manchester, UK. It is experienced in advertising and producing creative illustrations, sales brochures,
billboards, and impressive website design, search engine optimisation and web development for a number of clients.
6
Webster Mark, “Online Advertising Up To 4 Times More Effective Than Traditional Media”, http://virginia-press-release.com/41/Online%20Advertising%20Up%
20To%204%20Times%20More%20Effective%20Than%20Traditional%20Media.php, September 20th 2007
7
“Digital disruption to traditional advertising”, http://www.ibm.com/news/uk/en/2007/11/uk_en_news_20071108.html
8
Borrell Associates is a media research, consulting and project firm specialising in newspaper publishing, Internet and TV.
9
“Local Advertising And Traditional Media”, http://www.wildblueskies.com/2008/01/02/local-advertising-and-traditional-media/
10
Ibid.

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Sem III, Class of 2019-2021.
 MKS0113

Unilever’s Digital Media Strategy

Unilever Going Digital

Unilever is one of the world’s first and largest packaged consumer goods makers. It operates through two main
businesses: Unilever Home & Personal Care and Unilever Foods. It is the world’s top manufacturer in segments like
personal wash, prestige fragrances and deodorants; while it ranks third in food business after Nestlè and Kraft. Unilever
Home & Personal Care division includes brands like Dove, Surf, Snuggle, Sunlight, Lever 2000, Caress, Degree, Pond’s,
Vaseline, Q-tips, Mentadent, Finesse, Salon Selectives, ThermaSilk and Calvin Klein, Nautica and Lagerfeld cosmetic
and fragrance products. It is also a global leader in culinary foods, ice cream, margarine and tea-based beverages with
brands like Knorr, Lipton and Magnum. The company has its presence in over 150 countries around the globe, evident
from its motto: “Meeting the everyday needs of people everywhere.”11 With revenues of $52 billion for the year ending
December 2006, it had a growth of 11.4% over the previous year.12
Unilever was formed in 1930 with the merger of a Dutch margarine company, Margarine Unie and a British soap
company, Lever brothers. Individually both firms had their presence across the world even before the merger. Put
together they had operations in over 40 countries. From 1930s till 1980s, the company prospered with many acquisitions
and diversifications. It had an extensive range of product categories in each business segment – foods, personal care,
home care and specialty chemicals. As a result, due to its cumbersome operations, the company became inflexible to
change and was referred to as a ‘sleeping giant’. This led to its restructuring in early 1990s. As part of it, product
categories were reduced from 50 to 13 – to focus only on core categories; it made around 100 acquisitions and
targeted emerging economies like Eastern Europe, South-East Asia, Latin America, China and India. This yielded
good results with increased sales in late 1990s. The company also focused on different product segments in different
countries based on their sales potential. Unilever exited from businesses like chemicals, plant breeding and agricultural
products. The company had improved its operating margins from 6% in 1985 to 11% by 1999, and had a portfolio of
1,600 global, regional and local brands in foods and home & personal care. But in September 1999, the company
announced its plans to cut its unwieldy portfolio to 400 of its top ‘power brands’. The market took this move as an
indication that the company was unable to manage its brands, but the company’s plans were something else. Unilever
was not actually discontinuing these products, but was trying to sell them to companies in whose portfolios they fit
more easily, or be integrated into similar products that already exist in the Unilever range. By doing so, the company
intended to downsize the marketing resources for the other 1,200 products and shift them to ‘power brands’. This
radical decision came after its Brazilian subsidiary Elida Gibbs set an example by cutting the number of its advertised
brands from 20 to 7 in 1995 that raised its sales by 50% and margins by 1%.13 Hence, Unilever began to prune its vast
portfolio by disposing regional products and re-branding others, to concentrate on a smaller roster of global power
brands. The company was considered the world’s No.1 advertiser, spending about £2.5 billion a year.14
Most of Unilever’s product promotions were done through the traditional media of television, billboards, radio,
cinema, magazines, newspaper, etc. But the company had its unique style of promotion. It promotes individual
brands – Dove, Lifebuoy, Lipton, Close up, Lux, Pond’s, etc. – instead of its own name. The consumer actually
thinks that these products are made by different companies. The strategy behind such promotion was that, even if
a brand does not click, it does not affect the image of the company and other brands belonging to it. Though
Unilever was more used to traditional marketing and advertising media, by the turn of the century, it started increasing
the use of Internet and other innovative ideas for its marketing campaigns. As the company wanted to increase its
online sales – as more customers were having computers at home – in 2000, it committed £130 million15 towards
e-business initiatives. It termed its e-business initiative as ‘a shopping mall that never closes’. In August 2002, Unilever
launched AXE, a deodorant body spray for men, in US market – at the time when its position in the US deodorant
market had dropped to No.6 with only 5.4% of market share.16 By 2004, it grabbed a market share of 13%17 in US and
became the fastest growing deodorant brand.
11
“Unilever (UK/Netherlands): Profile”, http://www.mind-advertising.com/nl/unilever_nl.htm
12
“Unilever N.V. Company Profile”, http://biz.yahoo.com/ic/93/93845.html, January 31st 2008
13
“Unilever slashes its brand portfolio from 1,600 to 400 – Brief Article – Statistical Data Included”, http://findarticles.com/p/articles/mi_m0DQA/is_1999_Oct_7/ai_56904871,
October 7th 1999
14
Carysforth Carol and Neild Mike, “Chapter 5: Functional areas within business”, GCSE Applied Business (ISBN 0435446908), Harcourt Heinemann, 2002, page 87
15
Ibid.
16
Vasudha Aich and Venkatesh T.R., “Axe Effect in the US: Success through Viral Marketing?”, IRC, 2005
17
Ibid.

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Sem III, Class of 2019-2021.
 MKS0113

Unilever’s Digital Media Strategy

The success of AXE was attributed to its aggressive and unconventional ad campaign. Using AXE made men
irresistible to women was the ad-pitch. These ads, provocatively made to grab the attention of young males, showed
beautiful women ravishing male mannequins wearing AXE deodorant. In the initial stages of the launch, the brand
was advertised through TV. But it was observed that the conventional TV advertising was not making enough
impact on the target group, which spent more time online. The company launched its web-based initiatives with its
AXE website in 2002, banner ads on websites of men’s magazines like Maxim that in turn directed them to AXE
website and spreading word through online peer groups. Not much information was dissipated readily about the
brands; instead the target group was left to discover the brands for themselves through the site. The website also
displayed commercials that were considered too spicy for television. Within 4 months, the website had 1.7 million
visits. It also created an online game for men, aged between 11–24, to participate and win invitations to an extravagant
house party featuring music, TV and fashion celebrities. Various TV channels covered the event. The company, in
2005, released an online game – Mojo Master – for young men that could be played free on MojoMastergame.com.
A special feature of the site was a blog that detailed the real-life experiences of two young men Evan and Gareth
through video clips. The clips contained encounters with women during their trek across US. The clips were
downloaded and e-mailed by the visitors to their friends – creating a viral marketing effect for Unilever. It spiced up
the brand awareness through the unconventional use of the traditional media – like giving innovative sales kit to
300 Unilever sales persons (containing skateboard, backpack and other appealing items), recruiting brand
ambassadors (young male students); and interactive print-ads like the cover girl on a Colombian men’s magazine,
with a removable top, to demonstrate the ‘AXE effect’.
With the tremendous success of the AXE digital campaign, the company went onto experiment the same with
other brands. Dove, originally a non-irritant skin cleaner for burns and wounds, was re-branded as beauty soap in
1957 and was known for its mildness. But by 2003, its sales were in decline and market share was lost to competitors.
With some research, the company found that though the users recognised Dove’s quality, its image did not resonate
with their thoughts and, had become outdated and old-fashioned. In September 2004, the company re-launched it
using the slogan ‘the campaign for real beauty’ along with a website, campaignforrealbeauty.com. Dove’s campaign
integrated digital and traditional channels, and made optimum use of the same. Though the campaign ran in four
different formats – TV, print, banner and website – the online campaign played a main role in engaging women with
beauty debate in chat rooms and casting their votes, confessions, philosophical questions, rants and sharing their
views about the concept of beauty. This improved the self-esteem of young girls who felt less beautiful than models in
various beauty ads. In June 2005, the ads for Dove’s products were launched featuring regular women, instead of
models, to challenge the stereotypes set by the beauty industry. The campaign acted as a catalyst to broaden the
definition of beauty and, was identified and associated with regular women. Through this campaign, Unilever successfully
applied integrated marketing principles and an interwoven promotion, using traditional and digital channels, which
helped it click.
Success of these products proved that online advertising has a positive effect on brand awareness and purchase
intent; and can create perfect synergy with the traditional media, by reaching more target audience than a single channel.
The company now plans to significantly increase its budget for online promotion. According to Advertising Age estimates,
Unilever ranks second in global advertising expenditure with $4.5 billion in 2006. Marketing at Unilever has two disciplines:
‘in the field’ and ‘in innovation centre’. The former develops expert knowledge of local markets, consumers and uses it to
create marketing campaigns that maximise brand impact; while the latter combines research with local market insights
and works closely with departments of research, advertising, design and public relations. The company’s new portfolio
has become much leaner – making it clear for its brand managers and advertising agencies, to streamline and rationalise
its resources. Unilever’s chief marketing officer, Simon Clift, opines that it is really important that brands need to stand for
something in consumer’s lives – like the role of AXE and Dove in the present-day consumer lives that has made a much
deeper impact than 50 years ago, due to the shift from TV to digital media. He explains, “The many opportunities available
to Unilever in new media and the rapidly changing media habits of our consumers demand a strategic approach to digital
media and content. We believe a close, collaborative relationship between our categories and aligned digital agencies will
result in more world-class campaigns for our brands in new media.”18

18
“Unilever Rethinks its Digital View”, http://www.brandrepublic.com/News/596048/Unilever-rethinks-its-digital-view/, September 29th 2006

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Sem III, Class of 2019-2021.
 MKS0113

Unilever’s Digital Media Strategy

Unilever reduced its global digital agencies list to four – Tribal DDB, OgilvyOne, Momentum/MRM and dare – to
carry out its advertising tasks. It is also taking steps to make sure that its brand managers are on top of the digital
media trends. The company changed its corporate culture to encourage the use of new media channels to launch
products. Unilever then focused on how to adapt and use digital media in marketing its products, without letting
technology drive its strategy. Instead, it uses technology by defining the type of brand experience it wants its consumers
to have. It tries to stay as close to its consumers as possible, by embracing ethnography (observing their actual
behaviour) to generate insights. The advertising agencies, the company works with, are now becoming more of partners
in content creation, thereby restricting any one agency doing it all. Kevin, supporting the shift of company’s marketing
resources to the more ambiguous digital media in terms of effectiveness and recognising a combination of the effective
media, says, “It’s more of a migration of dollars to digital rather than a large shift away from traditional. Overall we need
to do a better job of understanding the funnel through which people consume media. They use a portfolio of media to
experience our brands, so a dramatic shift from one medium to another would be a mistake.”19

19
“Kevin George: Unilever’s digital Media Strategy”, op.cit.

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Sem III, Class of 2019-2021.