The surprising revenue drivers of Hindustan Unilever Limited

One of the most popular companies in the Fast Moving Consumer Goods sector is Hindustan Unilever Limited (HUL). The fame that HUL enjoys is not only restricted to its consumers, but also extends to B-Schools. In a recently conducted survey, HUL emerged as the most desirable brand to work for. With thousands of products in its portfolio, HUL is currently catering to every need of the consumers. They have a big basket of offerings ranging from tea and coffee brands to soaps and detergents. When there are so many products, it becomes important to understand what are the revenue drivers of Hindustan Unilever.

One interesting pattern is being observed. It is seen that the major revenue drivers for Hindustan Unilever have not been soaps like lifebuoy, lux, and breeze but the soaps that form a part of its premium segment and the detergents. HUL's premium line of soaps consists of brands like Pears, Dove, Lyril, and many others. On the other hand, its detergent portfolio is very diverse consisting of brands like Surf Excel, Wheel, Rin, etc that cater to the needs of consumers in every segment. Unilever is likewise being helped by different techniques, for example, premiumization, fortifying the centre, market development, creating new products and innovation, new channels, and brand remodels among others.

Since the start of the pandemic, the focus on cleanliness, hygiene, and sanitation have increased. Covid-19 has impacted the growth of every company and HUL's profits and revenues have also suffered. But HUL believes that since the usage of soaps has increased, in the current scenario the demand will also go up thereby giving an opportunity to earn better revenues from the soaps segment as well. In addition to this, increased reliance on the premium soap segment can also become an opportunity for HUL. Presently HUL has increased the production of its Lifebuoy product ranges and they even reduced the prices of Lifebuoy handwash and sanitizers by 15% to ensure its availability to all consumers.

Every company in the FMCG sector is working towards increasing its production and reducing prices of the necessities to make them easily available to the customers.