Text: Danlin He
In the Chinese market, the Unilever tea business, which has many well-known brands, has made important progress in the future direction!
Today, Snack Generation learned exclusively from Unilever that at present, the company's overall tea business independence plan is "in an orderly manner". "For China, the independent work of the tea business will be completed in the second half of this year." Unilever told Snack Generation that the new company after independence is "similar to a subsidiary" and will still operate independently within the Unilever system.
According to the "concrete plan" of unilever's independent plan for tea business in China, which has surfaced, this means that tea brands such as Lipton, a well-known tea bag brand, Pure Leaf, which specializes in food and beverage channels, and pukka, a British organic herbal tea that has been newly introduced to the Chinese market in recent years, will be injected into new companies, but not lipton ready-to-drink tea businesses that cooperate with PepsiCo.
The new team is in place
At present, Unilever is building a new organizational structure after the independence of the global tea business.
In April, Unilever had appointed John Davison as the global CEO of the new tea company. "He will lead the tea company on a new journey, and we will continue to adhere to the brand mission while seeking rapid growth in global business." Unilever told The Small Eaters today.
John Davison, Global CEO of Unilever Tea Company
According to the data, Unilever's tea business has a history of more than 150 years, dating back to brooke Bond Tea Co. (1869), a tea company founded in Britain, and Thomas J. Lipton Co. (1890), who later began shipping tea to the United States.
At present, in addition to Lipton, the company's tea brands also include Pukka, T2, Tazo and PG Tips, and the independent tea business will generate revenue of 2 billion euros (about 15.4 billion yuan) in 2019.
Unilever's global tea business
XiaoDian noted that the new CEO who landed in the air has a rich international executive experience and has a lot of ties to well-known consumer goods companies such as Danone and Diageo, but he has no direct work experience in the tea field before.
According to its LinkedIn, in the year before joining Unilever, Davison advised TPG on key consumer product investments for global private equity firms, assisted the International School for Management Development (IMD) Business School in Lausanne, Switzerland, with digital transformation case studies, and more.
He also served as CEO of Zuellig Pharma, Asia's leading healthcare services group, and over a period of 6 years, he drove a range of corporate transformations. Prior to that, Davison spent 11 years at French food and beverage giant Danone and was Regional President of Danone's dairy business in Asia Pacific, the Middle East and South Africa. In addition, he has worked for foreign wine giant Diageo, as well as management consulting firm McKinsey.
According to LinkedIn the new CEO introduced himself, he was born in the UK, fluent in French and German, a little Spanish and Italian, and his hobbies include music, mountaineering and tennis in his spare time.
In the Chinese market, a new team that will complete the independent Unilever tea business within this year is also "in place".
"For China, we have further improved the organizational structure of the team and have a larger and more complete operation team, and the new team has taken over various businesses in the past quarter." Unilever told the Small Eaters today.
Double-digit growth
Since the beginning of this year, this latest independent Unilever Chinese Tea Company has seen good growth.
"Looking back at the business performance of various channels in the first half of this year, our tea company achieved double-digit growth in the first half of the year. In the just-concluded 618 activities, the e-commerce business has achieved more than 40% growth. Unilever told Snack Generation today that it has "full confidence" in the new team.
In fact, the "absolute main force" of this tea company, Lipton, has maintained double-digit growth in the Chinese market in recent years, and has been in the "top spot" in the Chinese tea bag market for many years. Nielsen data shows that in 2019, Lipton accounted for more than 70% of the tea bag market in the offline channel non-herbal tea market.
XiaoShidai has introduced that this is mainly due to the continuous iteration and diversification of Lipton's business. With the continuous renewal and expansion of the product portfolio in recent years, the most well-known and classic iconic product of Lipton, "Yellow Brand Black Tea Bags", has long since ceased to occupy the "bulk" of its sales and revenue.
At present, Lipton operates more than 200 products in the Chinese market, covering tea bags, tea powder, canned loose tea and other categories, and sells about 2 billion cups of tea every year. In addition to the retail C-end business, Lipton also operates a large-scale catering B-end business in China, covering tens of thousands of catering stores nationwide.
Since the beginning of this year, Lipton has also maintained a certain new rhythm.
"Since April, we have successively launched the Earl of Red Adzuki Bean Coix Tea, which focuses on moisture removal, fruit tea triangle tea bags with large original leaves, and a new plant-based oatmeal 'milk' tea solid drink." Lipton told The Small Food Generation today that it hopes to create a "brand image suitable for young people's happy health".
"More brilliant"
Including the Chinese market, unilever's independent process for the global tea business is expected to be completed by the end of 2021.
As early as November 2019, foreign media reported that Unilever was considering selling its traditional tea business, and in response to this market rumor, the British and Dutch FMCG giant quickly denied it. But soon after, in February 2020, Unilever confirmed that it would conduct a strategic assessment of Pedon's tea business.
The company noted at the time that while the tea business achieved price-driven growth, sales volumes declined due to declining demand for black tea from consumers in developed markets. "Black tea (sales in the company's tea business) is over-represented, and this category is experiencing a slowdown in growth." Unilever CEO Joan Lu said.
In July 2020, the results of the unilever tea business assessment were "released", announcing that it would be divesting most of the tea business. According to the financial report, the revenue of this tea business in 2019 was 2 billion euros, accounting for about 2/3 of the company's tea business revenue. Among them, the Chinese tea business is also within the scope of divestiture, but Lipton Ready-to-Drink Tea, which cooperates with PepsiCo, is not affected.
In fact, it is not surprising that Unilever China finally chose the landing plan of "setting up a new tea company", because there is already precedent in overseas markets.
Since Unilever also has a business listed in Nigeria, the company issued an announcement on the local exchange at the end of February this year to spin off Unilever Nigeria's tea business and become an independent legal entity. This means that the tea business in other parts of the world may soon carry out similar "independent" operations.
Previously, when asked about the impact of the independence of the tea business, Unilever China has repeatedly stressed to Snack Generation that this will not affect the sustainable development of the brand; in the future, the brand will continue to provide consumers with quality products and services. "We believe that the company can achieve more brilliant results after operating completely independently." The company said today.