Unilever accelerates digital expansion as it looks to ‘invest and grow’

Chief executive Alan Jope says ecommerce will “clearly remain a key channel” after the pandemic, and is keen to bolster Unilever’s digital operations further in response to changing consumer habits.

UnileverUnilever has credited marketing investment and expansion for saving overhead costs and preparing the company for vital future consumer channels.

Speaking on an investor call this morning (29 April) to discuss the company’s 2021 Q1 results, Unilever CEO Alan Jope said ecommerce will “clearly remain a key channel” as the company continues to make “important strategic choices” to lead in digital.

“The pandemic has only accelerated the shift to online and we’re not seeing this trend reversing anytime soon. Growth in ecommerce in the first quarter was again strong at 66%, with our B2B ecommerce channel doubling in size, and strong growth from the omnichannel in the first quarter,” said Jope.

Ecommerce now accounts for 11% of group turnover, a quarter-on-quarter boost from 9%.

Unilever’s chief digital and marketing officer, Conny Braams, told Marketing Week in February, that bringing digital under the remit of marketing has enabled the business to move faster when it comes to ecommerce.

The brand pledged to capitalise on the rise of ecommerce brought on by the pandemic, at the end of its 2020 financial year.

Unilever’s marketing boss on why digital transformation should be led by marketing

Digital upgrade

In order to support the rise in ecommerce and other aspects of its digital transformation, Unilever has invested significantly in upgrading its digital marketing hubs, increasing the number from 39 to 46 across 40 countries.

“[This is where] audiences, analytics, activation specialists and online engagement leaders work with our performance marketers, our content managers and data governance experts,” explained Jope.

To manage inbound interest the company has 29 digitally-enabled consumer engagement centres, which directly communicates with 3 million customers annually.

“These are the capabilities that we have built, and will continue to build, to ensure we generate content that converts, and that it is executed flawlessly,” added Jope.

When asked about how the data centres and marketing hubs affected profit and loss, Jope said between 2017 and the present day, overheads decreased by 70 basis points.

“We have chosen to invest a little bit in marketing capability, and we will keep doing that. But this is definitely an area where we have a scale advantage in the size of our data estate. We have the second biggest data estate on Amazon’s cloud because of the huge consumer and customer database that we’re building,” said Jope.

“We’re now really learning how to extract value from that and we’ll continue to invest in the digital transformation of Unilever, but it won’t be net incremental because we’re making savings elsewhere.”

Unilever’s Q1 2021 results show turnover is down incrementally at 0.9% to €12.3bn (£10.7bn), however, underlying sales grew 5.9% and sales volume is up by 4.7%.

“Unilever is becoming match fit. We’re clear where we want to invest and grow. We continue the journey of operational excellence underpinned by our five growth fundamentals,” Jope said.