Top takeaways from Unilever CEO’s interview with JP Morgan

“My 37 years in Unilever is an advantage when driving change”

This is a complex company, so everyone must be clear on our priorities. Every time I join a meeting, I start by saying: “volume growth, positive mix, consistent gross margin expansion, profit growth in hard currency”. It sounds silly, but it's important to ensure everyone is aligned.

The heavy lifting of organisational change is behind us. Now it’s about continually elevating brand quality and execution.

“We’re outperforming in practically every single category”

This is driven by our SASSY framework – Science, Aesthetics, Sensorials, Said by others and Young-spirited brands – which defines how we approach product development and our models of reach, engagement and validation.

Science is about superior functionality. Aesthetics and Sensorials drive consumer preference. We’re putting in place a revolution in social-first marketing. We’re already close to 300,000 influencers. This is about ‘Said by others’ – our brand offering being validated and recommended by consumers.

An example of putting all these things together is Vaseline. A 155-year-old brand that, in the last couple of years, has been growing volume at 12%.

“I'm obsessed with premiumisation”

There are two seismic shifts happening. The first is how digitisation is step-changing consumer knowledge. People are interested in what’s in a product – the science – and they’re prepared to pay more for ones that perform.

The second is how household structures are changing. There are increasingly households of one or two people, who tend to spend more on self-indulgence. We see this as a driver of premiumisation.

“I’m very excited by the Wellbeing opportunity”

We’ve had double-digit growth in this part of our portfolio for five years now. It’s a very attractive territory because you can scale up brands fast. For example, when we acquired Liquid I.V. in 2020, it was a $120 million brand. This year it will be around $1 billion. When we acquired Nutrafol in 2022, it was $220 million. It will also hit close to $1 billion this year.

“We’ve built one of the best growth footprints of any big company in the US”

In the recent Advantage survey – where the top 130 US retailers scored their suppliers – we’re ranked No.2 overall, No.1 in Personal Care, No.3 in Beauty, No.1 in Foods. This is completely unprecedented for Unilever.

Dove is having spectacular growth. Our Hellmann’s business is doing very well. Our deos business is gaining share in every segment.

We’ve had five consecutive quarters of more than 4% volume growth. Our retailer partnerships are at a level I’ve not seen before.

“Our performance in Europe is driven by premium innovation”

In Europe, we’re doing especially well in two categories. In Home Care, our laundry innovations, particularly in short cycle washes, have allowed us to move into higher price points. The same in Personal Care, where we’re expanding whole-body deodorants.

Our focus is on increasing our investment in premium innovations that retailers value and consumers are prepared to pay for.

“The growth opportunities in India are massive”

I believe we’ll benefit from what will be a much more dynamic economic environment in the country. I was recently in central India, where there’s 500 million people and GDP growth is 10%. Our brands are perfectly suited to take advantage of this wealth expansion.

India is 14% of our revenue, the US is 21%. If we can deliver close to 4% volume growth in both, we have 1.6% at company level. That's essentially the anchor of our 2%+ volume growth plan.

“Gross margin expansion should position us in the top third TSR”

We’re working on four levers of gross margin expansion. The first is volume growth. If we achieve +2%, our gross margin expansion starts to kick in. The second is category, segment and channel mix. The third is interventions in the value chain of some key materials, like investing €1.3 billion in fragrances. And fourth, we’re allocating close to 60% of our CapEx to margin expansion initiatives.

This should give us gross margin expansion every year, which we believe will position us in the top third TSR of the sector.

Watch the full interview here: