Nestle vs Unilever

Nestle corporation and Unilever are multinational companies that were establishes in 1866 and 1930. The longevity and continues success of these two companies has been seen over the years with their expanding customer base on a global scale.

Continued rebranding, improvement and advertisement of their products have made them a household name in almost every country in the world. Indiscriminate investment including their operation in both socialist and communist countries including Russia has been instrumental to their expanding networks across the globe. Nestle has staff of about 283,000 individuals whilst Unilever has 163,000 employees as of 2010.Nestle corporation is a company that specializes in foods and nutrition products. The company has diversified in the food processing industry by producing a cornucopia of products.Their products include baby food, bottled water, dairy products, ice cream, confectionery, breakfast cereals, coffee and pet foods.

We Will Write a Custom Case Study Specifically
For You For Only $13.90/page!

order now

Nestle is however a 26.4 % stakeholder in the world largest producer of beauty and cosmetic products known as L’Oreal. Nestle is involved in joint ventures with other companies in Cereals with General Mills, beverages with Coca-cola, , dairy products with Fonterra dermatology with Galderma and finally Laboratories with L’Oreal. It is therefore indirectly involved in the production of non food products.(Nestle, 2010). On the Converse, Unilever is a more diversified corporation that has an array of consumer products. The company produces more than food products and beverages hence its products include cleaning agents, as well as products for personal care purposes.These products include nail polish, shampoos, deodorants, petroleum jelly (Vaseline), edible oils and fats, soaps, tea, skin and hair care products and other cosmetics. Unilever is directly involved in the production of both food and non-food products from the raw materials as with some products, and through all the stages of the production line(Unilever, 2010).Unilever Corporation is a multinational company that boasts of factories as well as laboratories on all the continents apart from Antarctica.

The company posted a net income of ˆ3,659 million and an operating income of ˆ5,020 million in the year 2009(Unilever, 2009). On the other hand, the Nestle Corporation draws its customer base from 86 countries. The company register a net income of CHF 10.43 billion (Swiss Francs) and an operating income of 15.70 billion in 2009 (Nestle, 2009).

Nestle vs Unilever Case studyBoth Unilever and Nestle use a the strategy of buying already established and household brands. They then expand these brand and market them more aggressively in their companies. This can be exemplified by the ice-cream market share that the two compete for at a global scale. Unilever bought both Ben & Jerry’s and Breyers Ice Cream to extend its tentacles.

Nestle responded by buying both Movenpick and Haagen-Dazs, Dreyer’s. In the end, these brands made the two companies the largest ice-cream sellers in the world with Unilever boasting of 16% a close second to Nestle which has 17.5 % of the global market share. They therefore have a lot of semblance in the marketing strategy. They employ avoid introducing a totally new product under a different company’s name.

In lieu of that, the two companies introduce these products/ flavors through the established companies which the populace is familiar with.These are the companies they have bought (Career Journal,2007). Both companies are aware of the global rise of economies and increase awareness of healthy food consumption. It is in this light that the two companies have shifted their axis of their paradigms into a marketing strategy that targets this growing class of people in north America and Western Europe. They have therefore given precedence to products with low fat and calorie levels to entice this market. This is how these two companies compete as they roll out nouveau product with descriptions fitting what the health conscious and fairly opulent consumer wants(Benady, 2005).

A financial projection of the purchasing power in Asia predicts and two fold increase in the purchasing power of the opulent populace in five years time. The two companies have a lot of prospects in Asia especially in the ice cream business. The only impediment they are faced with is that the market penetration is at minimal in these countries where owning a domestic freezer is a luxury.The marketing strategy they employ in the case of ice cream sale is employing street vendors who would dispense the ice cream in serving that do not require refrigeration due to their small sizes. The market aggressiveness of both Unilever and Nestle is almost uniform given the current trends in ice cream sales in the Asian countries (Career Journal, 2007).

However, Nestle has demonstrated slightly more aggressiveness and innovative characteristics when it comes to venturing into the Asian market than Unilever. Neslte does this by holistically bestowing certain responsibilities to its subsidiaries. This facilitates the seamless blending of its products in such a market by being in tandem wit the taste profile in the that foreign market. The company has business units numbering to severe.These are charged with the responsibility of laying out global marketing strategies as well as research and development , systems control and production expertise. This perspective is instrumental in fashioning a regional strategy that automatically avails a business strategy that will serve the local market.

The business aspect is therefore intricately interwoven with the marketing facet of the corporation(The times 100, 2010).As mentioned above, the two companies have unequivocally prodigious budgets which are generously allotted for marketing that has a synergistic effect with their well ramified and extensive marketing networks. These factors are instrumental to the acquisitions that they are planning to make in Asia which is the next new hot spot for marketing their products. It is imperative to note that the market penetration strategy of both Unilever and Nestle begins with acquisition of local companies in their target region. his definitely comes after identification of the next product that would yield growth for the company. In this case, nutritional products- foods that have medical benefits are the focus of the two companies.