Unilever shares were boosted by better-than-expected Q4 results on Wednesday, with sales growth in emerging markets leading the way.
Unilever is investing heavily in EMs, at some cost to margins, but investors are more than happy to back the strategy, in which the group is planning to raise the proportion of revenues coming from EMs from 55 per cent last year to 70-75 per cent in 2020. The stock was up 3 per cent – the best performer on the FTSE 100 as of mid-afternoon.
L’Oréal is bullish about the Indian economy – because it’s worth it.
India has become the sixth country in which the French cosmetics group has complete operations – including marketing manufacturing, and research facilities – joining France, the US, Japan, China and Brazil.
What to do if consumer needs change and the demand for your star product evaporates? Economic Darwinists would find that an easy question to answer: “Adapt or die.”
When Unilever was confronted with the decline of Lifebuoy soap in the UK, however, it decided to stick with the product unchanged – but to seek its future in emerging markets. The strategy has paid off. Nearly twenty years after the iconic brand exited its UK and US strongholds, Lifebuoy thrives as never before.
Despite Russia’s obsessive love affair with western beauty potions and creams, it’s never been an easy country for Avon Products.
Even though the US pioneer of direct selling has done very well in some other emerging markets, it has struggled in Russia to cope with tough competition, logistical difficulties and the big swings in the roller-coaster economy.
If Coty goes ahead with its $10bn bid it too will face the same challenges.