Our Compass strategy - Unilever

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Our Compass strategy Where we will win Growth priorities Our aim is to win share and grow volume profitably across our categories and countries. We have a strong portfolio of leading brands and market positions. Our outstanding presence in the emerging markets leaves us well positioned to win where much of the world’s future growth will be. We will also grow in the developed world which is almost 50% of the business. €4.6 billion of acquisitions have been announced since 2009. These underpin our determination to have scale and grow in Europe and the US as we accelerate growth in the emerging markets. Share of growth in 2010 Underlying volume growth in 2010 was underpinned by strong growth across our categories and regions, but particularly in Personal Care and the emerging markets. Developed Emerging Share of growth: 17% Share of growth: 83% Savoury, Dressings and Spreads Ice Cream and Beverages Personal Care Home Care Report of the Directors About Unilever “ Meeting our growth ambition requires us to stick to our strategy. This is set out in ‘the Compass’, which is based on winning in four key areas.” Paul Polman How we will win Winning with brands and innovation Brands and innovation are at the heart of our business model. We aim to offer a broad portfolio that appeals to consumers with different needs and budgets. Unilever brands must also offer superior product quality and be supported by excellent marketing. Our innovation programme is focused on being ‘bigger, better and faster’. This means using technology to create bigger, better innovation platforms that are then rolled out rapidly to multiple markets. For more go to page 12 Winning in the market place New markets are our biggest opportunity for growth. We can achieve this by being best-in-class at market development. When working with our customers, the challenge is to grow the size of the categories in which we operate. In a fast changing world, this requires flexibility in our approach to different channels and responsiveness to different customer strategies. To sustain winning relationships and to enable growth, we need to be consistently brilliant at customer service and in-store execution. For more go to page 14 Winning through continuous improvement Winning in consumer goods requires a continuous improvement philosophy – a little better every day. Our goal is to be faster and simpler and translate efficiency into more competitive costs. We are prioritising speed and flexibility in the supply chain to deliver growth. We are leveraging our scale more aggressively, especially in support services. And we are working to get a better return on our advertising and promotional expenditure – one of our most significant areas of cost. For more go to page 16 Winning with people We will only meet our growth ambition if we have the necessary talent and organisation in place. Across the business we are conducting reviews of people, skills and capabilities and are taking appropriate action and investing for the future. We know that high employee engagement and a performance culture are critical enablers of growth; our goal is to be employer of choice in our key markets. We have made necessary changes in our remuneration and working practices and are increasing investment in training and leadership development. For more go to page 18 Unilever Annual Report and Accounts 2010 11
Report of the Directors About Unilever 5award4s won by Axe at the Cannes Lions Advertising Festival over the past five years Sunsilk Co-Creations 5rolled out to over 0 countries in less than 12 months Solid gold from Magnum It’s on everyone’s lips! Magnum Gold?!, the first ever golden ice cream on a stick, launched in 29 countries in 2010 with a Hollywood blockbuster of a campaign featuring Academy Award winner Benicio del Toro. 12 Unilever Annual Report and Accounts 2010 Winning with brands and innovation Brands and innovation are at the heart of everything we do. Success means developing products that keep pace with changes in consumer lifestyles and that appeal to people at all income levels. We’re using breakthrough technology to get bigger and better innovations into the market faster, supported by the very best marketing. Superior products Our aim is to give consumers an unbeatable product experience. We are investing in our formulations and constantly assessing our product performance in order to drive consumer preference in branded and unbranded product tests. We’re doing this both for our innovations and for our existing mixes. Our vision of quality is not just about the functional delivery, but it’s also about sensorials: packaging design, textures, taste and fragrance. For example, the Rexona for women deodorant re-launch in 2010 has delivered great business results in some markets through quality improvement. Product testing of the antiperspirant aerosol has shown that, overall, women prefer Rexona to the closest competitor and, specifically, rate it higher on dryness, odour control and absence of white marks on clothing. As a result, Rexona was one of our fastest growing brands in 2010. Bigger, better, faster innovation Successful innovation is the lifeblood of any consumer goods company. For a business like Unilever, success means innovations that work globally, rather than in just one or two countries. For example, Dove Men+Care, a bold move into the men’s personal grooming category, was launched in over 30 countries in 2010. This kind of achievement starts with what we call ‘disruptive technology’, namely technology that makes a big impact on the market by meeting consumer needs better than all available alternatives. Sharp consumer insight and R&D are core to delivering on that aim.
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Our Compass strategy - Unilever

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