Following the announcement that Unilever will cut 1,500 management jobs; Ramsey Baghdadi, Consumer Analyst at GlobalData, a leading data and analytics company, points out that Covid-19 has changed the landscape considerably.
“Although Covid-19 restrictions have been alleviated in many countries, 45%* of consumers are still concerned about the pandemic when visiting shops, according to a survey by GlobalData,” explains Mr Baghdadi. “Shop visitor numbers remain lower than pre-pandemic periods, and this is a direct barrier to a significant portion of Unilever’s portfolio that relies on impulse buys. No longer can the company be supported by boosts from panic buying. New product launches and specialised products will likely see less consumer engagement, and sales will ultimately slow.
“However, Unilever has been flexible before. It quickly recognized emerging consumer behaviors such as working from home, for example, and was just as quick to react, with the likes of innovative channel strategies such as direct-to-consumer.
“The company would benefit from focusing its attention on strengthening its current product ranges and reaching new and existing customers, instead of diversifying into other sectors such as healthcare—as seen in the GSK bid. If Unilever continues to implement forward-thinking investments, it will not need healthcare acquisitions to strengthen its portfolio.”
* GlobalData’s 2021 Q4 Consumer Survey, November 2021, ‘Quite Concerned’ and ‘Extremely Concerned’ responses combined, 500 UK respondents