Unilever shared its second-quarter earnings with investors on Thursday, with year-over-year growth of 1.9 percent, below analysts media expectations of 2.2 percent. Unilever highlighted a trucking strike in Latin America—which accounts for 15 percent of Unilever sales—as the primary reason for the sluggish results. In the positive, sales grew four percent in emerging markets, including China.
The earnings call, led by chief executive officer Paul Polman and chief financial officer Graeme Pitkethly, notably opened the investor presentation with an image of Ben & Jerry’s employees participating in Pride Month. Ben & Jerry’s, owned by Unilever, has vocally supported marriage equality for over 35 years.
Unilever’s portfolio spans across food, home and healthcare industries including Dove, Dollar Shave Club and Lipton. As one of the world’s largest advertisers, the global brand isn’t shy about its $9.3 billion annual marketing budget and has publicly taken a stand against ad sellers—especially social media giants—for failing to provide a safe environment for brands.
During the Interactive Advertising Bureau conference, Keith Weed challenged social media giants to “collectively rebuild trust back into our systems and our society.” 2018, he said, would be the year when social media must win Unilever’s trust back.
Unilever reiterated its embrace of digital in the call, outlining the importance of using data and AI to guide the company’s marketing—also mentioning the company’s use of chatbots and virtual assistants to interact with customers. Polman said the company has grown ecommerce to between 60 percent to 70 percent, “well ever the 30 percent to 40 percent rate that the trend is growing.” Earlier in the week, Unilever joined a pilot program for Blis, a blockchain service designed to add transparency for marketers and data providers.
Sometimes if you want something done right, you have to do it yourself. Unilever took more of its ad work in-house last year, saving about 30 percent on agency fees and reducing the cost of its external agencies. However, in Q2 2018 the presentation noted that “brand and marketing investment was up 20 basis points [or .2 percent]. Compared to the prior year, we stepped up the absolute level of brand and marketing investment, focused on media investment while continuing to drive efficiencies in advertising production.”
In addition to the Ben & Jerry’s Pride Month imagery, the global brand used this year’s Cannes Lions Festival of Creativity to ramp up inclusion efforts through the Unstereotype Alliance. The initiative is coming together of powerful consumer brands who, in their own words, “seek to eradicate harmful gender-based stereotypes.” Unilever has been a large proponent of diverse and inclusive work environments and continues to highlight those causes in much of its product’s marketing as well.
“In all our launches, purpose is becoming more important,” said Polman. “If you look at plastics, consumers led that. You would be stupid to not be a forerunner.”