1 month ago
HUL's Strategy: Premiumisation Amid Inflation
Hindustan Unilever (HUL) is trying to do something smart.
They want to sell more expensive products to people who want premium items, but they also want to make sure that people who can't afford those products still have good options.
This is important because the cost of making their products is going up, but they don't want to make everything too expensive.
They are doing this by making some products smaller instead of raising prices too much.
They are also introducing cheaper versions of premium products, like sunscreen, to reach more people.
This way, they can grow their business and keep everyone happy.
HUL is focusing on premiumisation to drive growth while maintaining affordability for value-conscious consumers.
The company reported a 10% underlying sales growth in the June quarter, with revenue at Rs 17,341 crore.
HUL is implementing calibrated price hikes, passing on only half of the inflation costs to consumers.
Premium brands like Dove, Pears, and Minimalist are driving growth, while affordable options are maintained through grammage adjustments.
HUL is democratising premium categories like sunscreen by introducing affordable options to expand market penetration.
- Who
- Hindustan Unilever (HUL)
- What
- HUL is implementing a strategy of premiumisation while maintaining affordability for consumers.
- Where
- The strategy is being applied across India, targeting both urban and rural markets.
- When
- The strategy is being implemented in the current fiscal year, with a focus on the June quarter results.
- Why
- HUL aims to balance growth and affordability in an uneven consumption environment with rising commodity inflation.
Premiumisation Focus
Affordability Focus
Product Strategy
Premiumisation Focus
HUL is focusing on premium brands like Dove, Pears, and Minimalist to drive growth and move consumers up the value ladder.
Affordability Focus
HUL maintains affordable entry-level products and adjusts grammage to keep prices low for value-conscious consumers.
Pricing Approach
Premiumisation Focus
HUL is implementing calibrated price hikes to pass on only half of the inflation costs to consumers.
Affordability Focus
HUL avoids sharp price increases on entry-level products to preserve affordability.
Market Penetration
Premiumisation Focus
HUL is expanding premium categories like sunscreen and body wash to tap into aspirational consumers.
Affordability Focus
HUL aims to democratise premium categories by introducing affordable options to reach a broader market.
Key facts
- Company
- Hindustan Unilever (HUL)
- CEO
- Priya Nair
- CFO
- Niranjan Gupta
- June Quarter Revenue
- Rs 17,341 crore
- June Quarter Net Profit
- Rs 2,673 crore
- Ebitda Margins
- 23%
- Premium Brand Growth
- Dove, Pears, Minimalist
- Affordable Product Strategy
- Grammage adjustment, fixed price points
Quotes
Niranjan Gupta
Chief Financial Officer of Hindustan Unilever
“We’ll continue to take some calibrated, measured steps on pricing and continue to drive savings as well.”
financialexpress.com
“Penetration of sunscreens in India is under 2%. Our opportunity is to democratise sunscreen at scale.”
financialexpress.com
Sources
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