For Kees Kruythoff, the president of Unilever North America, the word beauty is a misnomer when describing the company’s $21 billion personal-care business. “We have a unique point of view around beauty,” he said, in his keynote address, which opened the 2015 WWD Beauty Summit. “We believe all people are beautiful. We don’t need to make people beautiful.”
Instead, the consumer products giant is in the confidence business, Kruythoff said, creating products that drive desire through purpose and innovation. That philosophy epitomizes Unilever’s oft-stated corporate strategy, which is to double its sales while halving its environmental footprint. Beauty, of course, is a key component of that vision. “A big priority for us is to build our personal-care business,” says Kruythoff.
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While Unilever has been on an acquisition spree of late, snapping up the prestige skin-care brands Ren and Kate Somerville in the last five months, Kruythoff said that growth will primarily come through Unilever’s core businesses, via innovation, capitalizing on its brand’s histories, premiumizing its mass offerings and ensuring that a brand’s purpose is a key part of its platform.
“Purposeful brands grow faster and at double the rate of the rest of our portfolio,” said Kruythoff, “and they are more profitable as well.” As an example, he cited Dove, whose decade-long Self-Esteem Project has catapulted the brand into the public consciousness and hosted more than 60 million women worldwide in its workshops.
Innovation, too, drives Unilever’s business, but only if it is “real, differentiating, breakout innovation,” said Kruythoff, who showed a picture of a crowded hair care shelf in a typical mass merchant and noted that in 2014, there were 18,000 products in the market, but only 8 percent of sales were in innovation. “The shocking reality,” he said, “is that when you ask consumers their satisfaction level, only 11 percent say they had a satisfying experience either in the shopping experience or the product delivery.”
As an example of meaningful innovation, he pointed to Unilever’s deodorant business, which successfully launched new technology that transforms a wet aerosol spray into a dry experience and could add $1.7 billion in sales to the business this year, Kruythoff said.
As impressive as that number is, Kruythoff said Unilever’s real growth will come from strengthening its core brands rather than breakthrough innovation. One key strategy is to focus on and reinforce the history of a brand. So Vaseline, which first launched in 1879 as a healing product, has been relaunched with this platform. Launches like a healing serum epitomize a modern iteration of Vaseline’s history, Kruythoff said, while providing aid to refuge camps where extreme dry skin conditions and open wounds abound provides the brand with purpose.
Unilever is also actively premiumizing its core mass-market personal-care brands, as with Suave. Not so long ago, the brand was best known as a value brand with prices starting at 99 cents. Over the past couple of years, the brand has gone upscale, launching collections based on market trends like Argan Oil and sea minerals whose prices can be more than double the core line.