New Delhi: India’s largest consumer goods firm Hindustan Unilever Ltd on Friday reiterated the use of technology and data at the company that will continue to help drive growth for the maker of Lux soaps and Knorr soups.
“With disruption becoming par for the course, we observe different retailer and distributor’s business models and a non-linear consumer journey. To be at the forefront of such a changing ecosystem, we continue to put a big thrust on leveraging technology and data-led decision-making," the company said at its annual investor meet presentation in Mumbai, on 7 June.
The company has been harnessing data over the last few years to better predict, capture and fulfil consumer demand, via augmented decision making, and automation. Some of these initiatives include connected store programs such as 'Humara Shop' that helps neighbourhood stores go online, and initiatives like 'Shikar' and 'Samadhan' that are apps designed for retailers for direct ordering and fulfilment. “Our connected stores program is now coming of age as we are creating a complete eco system across shoppers, stores and retailers covering demand generation, capture and fulfilment," the company said as part of its ‘Re-imagining HUL’ programme in the presentation. More recently, HUL also said it is working on developing niche digital skills in leaders and upgrading the digital skills footprint of employees across the organisation.
The meet, said Jefferies’ analyst Varun Lohchab, “highlighted the company's superior execution and lead over peers in terms of adoption of technology in a holistic way across the value chain right from gathering consumer insights, demand generation and fulfilment."
In the presentation, Hindustan Unilever also outlined its business for the year, while top management gave a commentary on consumer demand in the market.
HUL said net sales more than doubled over the last decade to ₹37,660 crore. It added that over the last six years, categories such as hair care, tea, coloured cosmetics, and laundry were "outstanding performers". Turnover of its hair care segment where the company owns brands such as Dove, Sunsilk, and Tresemme among others, nearly doubled between FY13 and FY19.
Apart from that, the company highlighted its future growth plan with its continued focus on its core portfolio that comprises of 40% to 45% of its business; and creating future categories by driving penetration in categories such as coffee, face wash, and hair conditioners.
The company also emphasised its focus on developing the naturals portfolio. The company’s naturals portfolio that comprises of brands such as Ayush Lever is growing twice of HUL's overall average, the company noted.
Interestingly, HUL that has over the last few years strengthened its presence in key categories of hair care and packaged foods via acquisitions of hair oil brand Indulekha, Adityaa ice cream, and its buyout of British company GSK's consumer business in India said it will continue to leverage M&A to expand its portfolio.
Speaking to analysts, the company's top management also gave an outlook on consumer demand in the market that has remained tepid over the past few quarters on the back of slowing rural demand.
The company expects softness in demand to continue in FY20. However, on the more recent government initiatives such as setting up new cabinet committees to drive growth and create jobs, the management added. "The government initiatives clearly signify that the government is looking to focus on growth. In few quarters, one should see positive impact of the initiatives that are being taken," analyst Abneesh Roy, at brokerage firm Edelweiss, said in a note on the company’s analyst meet.