Unilever (ULVR) Bernstein Annual Pan-European Strategic Decisions Conference summary

Strategic transformation and performance focus

• Emphasis on holistic product superiority, with a proprietary methodology analyzing 21 demand drivers across 6 Ps, now covering 60% of the business and aiming for 70% by year-end.

• Significant cultural change underway, including a 17% workforce reduction and a shift to a performance-driven culture, with intolerance for denial and clearer accountability.

• Five key metrics—volume growth, positive mix, gross margin expansion, turnover and profit growth in hard currency—are now central to performance management.

• Board changes, including new chairman and Nelson Peltz, have intensified performance management and strategic clarity, supporting major decisions like the ice cream business separation.

• Transition from a geographically led to a category-led organization has improved category strategy, innovation, and portfolio coherence.

Market competitiveness and investment

• Shifted competitiveness measurement from turnover-winning to turnover-weighted share, focusing on true market position and addressing prior share losses, especially in Europe and Indonesia.

• Marketing and execution improvements are ongoing, with increased A&P investment (from 13% to 15.1% of revenue) aligned to a 2%+ volume growth ambition.

• Progress in Europe is evident, with innovation and execution driving share gains, while Indonesia remains a challenge due to leadership and channel conflicts, expected to improve after Q1 next year.

• India is a core growth market, with strong market share, digital reach, and a commitment to defend and expand its position, especially as e-commerce grows rapidly.

• Private label is not seen as a significant threat in India for the next five years, with premiumization and brand aspiration driving growth.

Sustainability and portfolio strategy

• Sustainability strategy now focuses on five metrics across four priorities: climate, nature, plastics, and livelihoods, with more urgent, time-bound targets.

• Embedded sustainability costs are seen as a long-term advantage, especially as regulation increases; single-use plastic sachets remain a technical and cost challenge.

• Ice cream business separation is driven by its outlier status in channel, margin, and capital intensity, while nutrition remains integral due to its synergy and profitability.

• No major portfolio moves are planned beyond the current strategy.