Unilever adapts in UK

03 October 2011

LONDON: Unilever, the FMCG giant, is adapting its approach to meet the needs of UK consumers, many of which are facing considerable financial pressures but remain highly demanding of brands.

Speaking at a recent event, Amanda Sourry, Unilever's chairman for the United Kingdom and Ireland, outlined several core trends currently reshaping the trading climate.

Firstly, she suggested the UK was witnessing the "biggest fall in disposable income" for three decades, adding that the country has the fifth highest poverty rate of the European Union's 27 member nations.

More specifically, around 20% of UK households are at or below the poverty line, defined as earning a minimum of 60% less than the median households.

"Less money is now a long-term fact of life," Sourry said. "Living standards have been squeezed since 2005 and statistics from the Office of National Statistics are showing the biggest decline in these in 35 years. Not since 1977 have living standards been this low."

As a result, a new generation of "super savvy" shopper has emerged, characterised by habits ranging from buying products on promotion to making greater use of platforms like Groupon, the daily deals site.

"Consumers are waiting for offers and sales which they know to expect. DIY and cutting out the middle man is a growing trend," Sourry said. "They are using cash rather than cards. They use home computers to focus on bargain hunting."

However, despite the changes that have accompanied the economic crisis, there has not been a parallel downgrading in the demands displayed by the target audience, according to Sourry.

"Falling living standards have not been accompanied by falling aspirations - consumers still have the same high personal aspirations," she said. "Our R&D teams are innovating to meet more of our customers' lifestyle aspirations."

Indeed, the rise of digital media and social networks give shoppers unprecedented access to information, fuelling a desire for accountability and transparency among brand owners, and a genuine dialogue.

"We've had recessions before but this one is different because it's accelerating the change in the relationship between consumers, citizens and companies," Sourry said. "They are looking for deeper relationships with the products and businesses they consume."

"They want to understand more about what brands stand for - and we're keen to improve our dialogue with them especially around our key goals of reduced environmental impact and increased social impact."

Data sourced from Birmingham Post; additional content by Warc staff