Case “Nestle and Uniliver”: Marketing strategy

Witness line tourists queue length a long line to wait to turn prepayment Bertillon ice cream shops in the Ile Saint-Louis, a tourist destination famous in Paris, who also noticed that, in the muggy summer days as the this, nothing can help people against replay the heat better than a cool glass of ice cream. What kind of ice cream from the upper class, such as Chunky Monkey from Ben & Jerry, dishes of ice cream less fat Dreyer, ice cream products to the United States has also invisible attraction of the Bertillon, the third-cream in the world is creating the flavor ice cream to meet every kind of taste and budget.

At present, ice-cream industry global value of USD 59 billion are under the dominion of the two giants is Switzerland’s Nestle and Unilever in Britain and the Netherlands. The two corporations are now controlling more than 1 / 3 ice-cream market in the world and accounts for half the market in the U.S. ice cream. At present, both Nestle and Unilever are all the strategic expansion into market areas in developing countries in Asia and Latin America.

This is a war trophy with extremely attractive, happening on a large market and rich. According to the calculation of the agency Euromonitor research, sales of ice cream industry’s global growth with high-speed 2.5% per annum and will reach the value of 65 billion USD in 2010.

In Western Europe, the cream of the largest in the world, a cream of the value of 21.5 billion USD have been consumed in the last year. This figure of the region North America is 16.3 billion USD. At present, for ice cream manufacturers, the market potential growth promises, especially the economy is emerging as China and Brazil, where sales of consumer goods cream annually in turn increased 8.5% and 8 % Annually.

High profits

Two decades ago, both Nestle and Unilever are not much attention to the array cream production. However, since the beginning 1990s, both groups this same starting a campaign to buy back strong. Nestlé dominated the ice cream brand Haagen-Dazs, Dreyer’s and Movenpick of Switzerland. Unilever also the “gulp” Breyers Ice Cream and Ben & Jerry. Currently, Nestle accounts for 17.5% market share in the market, global ice cream, while Unilever is in the position of the button with 16%.

The rest of the market in the world are very poorly distributed, ice-cream manufacturer’s third-largest in the U.S., Wells’ Dairy only modest market share is 5%. Some ice cream manufacturers have other languages in the world is a Baskin-Robbins (a division of Dunkin ‘Brands) and Lotte, brand cream largest of Japan. Manufacturer cream leading Chinese of Inner Mongolia Yili accounting for 17% market share in the domestic market and will be the exclusive sponsor of milk products for Beijing Olympics 2008.

Decision attacked “cool areas” have come to deserve answers to both Nestle and Unilever. 20% of the total revenue of 42 billion USD of Nestle in the first half of this year as part of producing ice cream and products made from milk. With interest rate profit before tax of 20%, ice-cream division of Nestle milk collection of nearly 900 million profit, higher than the profits of any other department in this company.

Also no less competitive, producing array cream and beverages of Unilever also occupy 20% of total revenue 26.7 billion USD in the first half of this year’s Group of this. Estimates, only ice-cream products have accounted for 10% of the profits in paragraph 3 billion USD of revenue that Unilever in the first half of this year.

To promote growth, both Nestle and Unilever together find any way to attract customers. With the buy back two ice-cream brand in the U.S. is Haagen-Dazs and Ben & Jerry’s has presented all over the world, the two corporations had to be leaders in creating a tendency to consumers, dragging customers out of the ice cream market is low-level production series, to the products of high quality ice cream, bring the level higher profits.

“Through the focus on the brand high-quality ice cream, both companies had increased the value of their product,” analysts on canned food Redruello Francisco at Euromonitor said.

Products for better health

The economy is emerging around the world will continue to promote consumer trends that Nestle and Unilever have been created, where consumers have higher incomes to read into things such as the cream of high level.

“The focus on product quality, brand names are preferred as a part can not be separated from the growth strategy of us,” Jean-Marie Gurne, heads of department strategic portions of ice cream production Nestle said belonged. He predicted, sales of consumer goods cream of the global Nestle will increase to 3% next year.
In addition, both Nestle and Unilever are the same dedicated attention to the health problems of customers, particularly in Europe and North America. Two manufacturers have been launching these products has creams function of Calorie and fat low.

The Nestle spent 2.5 billion USD to buy the ice cream brand Dreyer’s Grand Ice Cream in 2002 helped ensure the airline market share in the array market is added each day one this important in North America. Products less fat cream of Slow Churned Dreyer’s, with the amount of fat reduction of 50% and Calorie reduction of 30%, has gained brilliant success, and even forced Unilever also be launching the product similar to brand Ben & Jerry.

In order to market in Asia

Although these products have more advantages for health as mentioned above has helped Nestle and Unilever increasing sales in developing markets, growth prospects for the biggest two “big he” these are located in Asia, where ice cream market which is predicted to growth at two numbers within 5 years to come. Total revenue from ice-cream market in Asia - Pacific in the last year has reached 11.6 billion USD, of which, only the China market reached 3.7 billion USD.

At present, the level of penetrating Nestle and Unilever in emerging markets is still low, although both these manufacturers are all accelerated in markets such as Indonesia and the Philippines hopes to attract more customers more advanced. Because many families in developing countries do not have a refrigerator, two ice-cream manufacturers will focus on the sale of the export component for a cream eating through consistent sidewalks. This strategy will help expand the market for them in the fridge, but it is still a luxury items.

At the current time, Nestle and Unilever are two opponents need the cream on the market worldwide, but some analysts to believe that Nestle will be able to adapt better to the local market than other opponents . Whether whatever reason again, the level of globalization increasing in the ice cream industry in the world are making the third-cream small hearts can be difficult to overcome the two “big him” this. With a distribution system and large budget is plentiful for marketing activities, Nestle and Unilever have advantages over whole. Both manufacturers said this, in the future they will continue to buy back their opponents small children, especially in Asia.

Clearly, to do so at a time, will no longer carried the cream local small anymore. But as long as Nestle and Unilever took to the ice cream flavors wonderful to help people eliminated the heat of summer, no one will pay attention to it.