“Unilever Revitalizes Its Mission and Strategy”
Competitive advantage for organizations comes from various factors. These factors help the firm in developing the valued and desired competitive advantage over other companies in the industry. Each organization ought to identify its competitive functional sectors to help it increase its profitability.
Quality is one of the factors of competitive advantage that companies use to ensure that they are ahead of their competitors in the industry. Companies invest much money toward the achievement of defect-free products. Product quality means much to customers since customer prefers purchasing better quality products that meet their needs. Therefore companies seeking to achieve customer satisfaction must develop high-quality products which in turn will give them a competitive advantage over other firms.
Pricing is another factor of competitive advantage and companies mainly focus on providing products at a lower price than their competitors or providing high-quality products that justify higher pricing. Pricing is also a major area used in the marketing of products and both seller and buyer are interested in it. Pricing is a complex and thus companies must understand that pricing is both an art and science. Some pricing strategies include raising the pricing to raise revenue or offering tiered pricing among others.
Location selection is also vital and organization must identify and select locations that are convenient to the customers. While selecting location firms usually consider how the products will reach the customers as well as moving the products to a wider area.
Speed is another factor that determines the rate of providing services and producing products. The speed of production should match the speed in which the products moves to the customers. Companies thus strive to avail better products and services to the customers at a faster speed than the competitors.
Based on the case study Unilever has a competitive advantage since it operates in 150 countries making it easier for the company to distribute its products. It is worth noting that its operating in various countries enables Unilever to sell 150 million products daily. The more the company sells the more the revenue and thus the advantage of having its operation in many countries. Operation in many nations also helps the company to have a large customer base which in turn increases profitability. As the stated earlier location is vital since it enables the company to provide its wide range of products to its customers at a speedy rate. Unilever is also a large company and has around 234000 employees. The large size means that the company has around $53 billion annual revenue which enables the company to have robust marketing and branding than its competitors. More marketing and branding means that the company has a higher chance of attracting customers and thus increasing its profitability. The company has also invested in the development of low carbohydrate diets which are termed as high quality and healthy foods. The move gives the company a competitive advantage as there is a growing trend of people moving away from unhealthy fast foods.
Unilever’s mission statement is unique and differentiates the company from its competitors. The statement “add vitality to life” focusses on addressing various initiatives addressing the customer’s wellbeing. Changing the mission to “path to grow” was effective since the organization’s profit increased. The mission statement is basically enough and thus I would not recommend any changes.
Based on the case study Unilever major strength lies in its size, scope and skills that enable it to be ahead of its competitors in the industry. The company also manufactures various products which make it generate revenues from various sectors. The large size of the company is also a weakness in a way for Unilever since some of its product may not get enough attention and support making them inferior. The size also makes it difficult for the company to tackle various environmental elements. For the opportunity, the company may rely on globalization to expand its operation to various countries across the worlds. The company can also venture in the production of organic products since people are moving toward acquiring healthier meals. Unilever is threatened by the competition from other companies in the same industry such as Colgate-Palmolive, Nestle, Procter & Gamble, Danone, Nestle and Reckitt Benckiser. The ongoing global economic crisis brought about by coronavirus pandemic has affected various companies and Unilever an FMCG company has not been left behind and it may be forced to close some of its operations in various countries.
Patrick Cescau needs to address the threat of competition from other companies by clearly paying attention to the 400 extra lucrative brands. Cescau thus needs to keep the cash inflow required for advertisement and other things needed to beat the competition from rival companies.