SUCCESS STORY OF UNILEVER
By
Ali Haider
FA18-BBA-144
Submitted to: Mam Hina Zawwar Baloch
STRATEGIC MARKETING
COMSATS UNIVERSITY ISLAMABAD, LAHORE CAMPUS
Success Story of Unilever
History of Lever Brothers Company:
Lever Brothers Company is one of the largest manufacturers of soaps and detergents in the United States.
It is well known for such famous brands as Sunlight dish detergents; Wisk, Surf, and "all" laundry
detergents; and Caress, Dove, Lifebuoy, and Lever 2000 soaps. Lever Brothers is a subsidiary of the AngloDutch Unilever group, which includes more than 500 companies and has sales of more than $43 billion
annually.
Lever Brothers Company has its roots with William Hesketh Lever, an English grocer. Beginning in 1874,
Lever's wholesale grocery business had been marketing a soap made specially for them called Lever's Pure
Honey. By the 1880s, Lever had concluded that he had expanded the grocery business as much as he could,
and he looked for another enterprise. He decided to market soap. As a child, his first job in his father's
grocery store had been to cut and wrap soap. He knew the importance of a brand name that he could register
for exclusive use and chose the name "Sunlight." At first, he contracted with various soap makers to
manufacture "Sunlight," which he then packaged and marketed. In the mid-1880s, raw materials were cheap
and workers plentiful, and Lever decided to set up his own soapmaking plant.
Arranging a loan to start the factory as a branch of his family's wholesale grocery business, William and
his brother James began production. By January 1886, the plant was producing twenty tons of soap a week
using the "recipe" for Sunlight soap (made from oils rather than tallow) that the Lever Brothers had
perfected. Two years later, the plant had a capacity of 450 tons a week. Glycerine was a lucrative byproduct
of the soapmaking process, and by the end of 1886, Lever Brothers also had a glycerine factory. At first
Lever was selling locally, then its market branched out to include Scotland, Holland, Belgium, South Africa,
and Canada. In 1888, with the success of Sunlight, William Lever went looking for a new site for his
company, which had been operating from leased facilities. He bought land on the banks of the Mersey River
where he built Port Sunlight. Over a period of years, he bought almost 330 acres.
At first Lever manufactured only Sunlight soap. In 1894, though, he introduced Lifebuoy soap, a household
soap with carbolic acid as a disinfectant. The new product also used up the residual oils left over from
production of Sunlight. In 1899, Lever's company also began producing "Lux" soap flakes.
Lever opened a small office in New York in 1895 to handle U.S. sales of Sunlight and Lifebuoy soaps. In
1898, Lever acquired a small soap factory in Cambridge, Massachusetts, the company's first manufacturing
operations in the United States. A few years later, the company acquired a factory in Philadelphia. The
Cambridge plant did business throughout New England, and the Philadelphia plant distributed to the rest
of the country. During the early years in America, neither Lifebuoy nor Sunlight sold well. Americans
preferred large bars of soap because they seemed like a better value than the small tablets of Sunlight. Lever
was more successful with its sales of "Welcome" soap, which satisfied Americans with its larger size. Sales
of Lifebuoy soap and Lux finally started to take off, but Sunlight never did catch on in the United States.
Competition was strong among the top three soap manufacturers: Procter & Gamble, Colgate-PalmolivePeet, and Lever Brothers. Lever Brothers had given up on Sunlight, but Lifebuoy and Welcome were selling
well due to heavy promotions which included gifts, special displays, demonstrations, and even door-todoor visits. But it was Lux that became its greatest success.
Meanwhile, the parent company in England was in the midst of negotiations that would soon make Lever
Brothers of America a subsidiary of a newly formed partnership. In 1929, after years of talks, Lever
Brothers Ltd. and Holland's Margarine Unie finalized a deal to become Unilever. They remained two
companies with two sets of shareholders and two headquarters but one board of directors. Unilever Public
Limited Company (PLC) was based in London and Unilever NV (Naamloze Vennootschap, meaning
limited-liability company) was based in Rotterdam. Although legally distinct, they operated as one
company
With the company becoming more diversified in the 1980s, Unilever reorganized Lever Brothers, forming
three separate divisions: Household Products Division, Foods Division, and Personal Products Division.
Following the acquisition of Chesebrough-Pond's Inc. by Unilever, Lever's Personal Products Division was
transferred to this company. Lever's Foods Division was spun off into its own operating unit, called Van
den Bergh Foods, in 1989. Following these changes, Lever Brothers became solely a soap and detergent
company.
Lever Brothers' winning position in the toilet soap market convinced the company that it could dominate
other market segments too. But Procter & Gamble, Dial, and other soap makers began to develop new
products or reposition existing ones to capitalize on the market for "all-in-one" soaps. Soap makers
collectively
spent
more
than
$183
million
on
advertising
in
1991