Schumacher’s overhaul of the global fast-moving consumer goods business has developed at a rapid pace since his July 2023 appointment, including plans to cut 7,500 office jobs in Europe.
The Marmite and Knorr brand owner’s first-half 2024 sales, marking Schumacher’s first year in office, showed 2.6% volume growth, following Europe’s first-quarter 1.5% decline, showing signs the business’s Growth Action Plan was beginning to yield positive results.
As part of that plan, Unilever would focus on fewer, bigger innovation bets, Schumacher said at Barclays’ Annual Global Consumer Staples Conference.
Unilever’s pipeline of 12 NPD programmes
“Innovation is the lifeblood of CPGs [consumer packaged goods], more so than we thought,” he said.
“It’s 80% of where we play and you need to build categories and markets and I’m a very big believer in innovation, but it needs to have a serious programme.”
Unilever would attempt to double its innovation size, focusing on its 30 ‘power brands’, to include more €100m programmes, with 12 “big bets” set to become “€100m platforms in two-to-three years’ time”, he said.
“We’re on the way to do that. It’s only one year down the road [since the new plan], but I feel very good about it. They’re all behind these 30 power brands.”
Long-term, multi-year, bets were the focus going forward. Schumacher claimed the business had doubled the number of innovation programme since 2020 with the additional 12 in the pipeline.
Cost-savings in Schumacher’s sights were to be around €800m, coming from the job cuts but also by focusing on increased productivity through net supply chain improvements. Savings from the efficiencies and cuts would be ploughed into market investments and tech capitalisation.
Unilever’s ice cream business
Next steps for Unilever’s soon-to-be separated ice cream business, another of Schumacher’s announced improvements, would include a strategy to improve sales before the detachment and following a difficult start to the summer in Europe.
Within ice cream, it was Schumacher’s expectation the business would “improve versus 2023 on all metrics”, including topline, gross margin, operating margin and cash delivery, and “I am still convinced we are going to get there for the full year”, he said.
First-half ice cream sales, which include brands Magnum and Ben & Jerry’s, showed just 0.6% growth driven by price inflation.
The division’s sales had not been helped by poor performance in China, either, where market conditions had been tougher, yet bad weather in Europe had certainly been problematic.
