Tag: HUL

Q2-2016: HUL YoY marketing spends up 23.8%

BENGALURU: Indian FMCG giant Hindustan Unilever Limited’s (HUL) Advertisement and Promotions expense (marketing spends, ASP) in Q2-2016 (quarter ended 30 September, 2015, current quarter) was 23.8 per cent more at Rs 1145.04 crore (14.4 per cent of Total Income from operations or TIO, approximately $176.7 million) than the Rs 925.05 crore (12.1 per cent of TIO) in Q2-2015 but was 0.7 per cent lower than the Rs 1153.39 crore (14.2 per cent of TIO) in Q1-2016.

Note: (1) 100 lakh = 100,00,000 = 1 crore = 10 million.

(2) All figures in this report are standalone figures filed by the company. The trends are based on the numbers submitted by the company or picked up from the company’s website. For performance of HUL’s various product lines please refer to the attached earnings release for Q1-2016.

(3) The US dollar figures are approximately based on a conversion rate of 1US$ = Rs 64.79 at a particular time on October 19, 2015.The converted numbers have been rounded off.

HUL chairman Harish Manwani said, “The business delivered another quarter of profitable volume-led growth. We continue to invest behind our brands and in-market executional capabilities to drive the competitiveness of our portfolio. The deflationary commodity cost environment is likely to continue in the near term and our strategy of delivering consistent and competitive growth with sustainable improvement in operating margin remains unchanged.”

Advertising and Sales Promotion trends

HUL’s ASP in Q1-2016 was the highest during a four quarter period starting Q1-2013 until Q2-2016 in terms of absolute rupees. Q2-2016 ASP (current quarter) in terms of percentage of TIO was the highest during the period under consideration. Further, during the period under consideration in this report, ASP in absolute rupee spends shows a marked linear increasing trend, while ASP in percentage of TIO terms shows a slight linear increasing trend. The company’s lowest ASP was in Q2-2013 at Rs 768.98 crore (12.2 per cent of TIO) in absolute rupee spends during the period under consideration, while the lowest in terms of percentage of TIO was in Q4-2014 at 11.8 per cent of TIO (Rs 840.34 crore). Please refer to Fig A above.

If the company follows the trends of the past three fiscals, at least one or more quarter in FY-2016 will see higher ASP in terms of absolute rupees than Q1-2016.

HUL Revenue and PAT

Please refer to Fig B above. HUL reported 4.1 per cent growth in TIO in Q2-2016 at Rs 7955.39 crore as compared to the Rs 7639.33 crore in the corresponding year ago quarter, but was 1.8 per cent lower than the Rs 8105.13 crore in Q1-2016. The company’s TIO shows a linear increasing trend as indicated by the broken blue trend line in Fig B. TIO in Q1-2016 is the highest reported by the company during the 13 quarter period under consideration in this report.

HUL’s PAT in Q2-2016 was lower by 2.6 per cent at Rs 962.24 crore (12.1 per cent margin) as compared to the Rs 988.1 crore (12.9 per cent margin) in Q2-2015 and was 9.1 per cent lower than the Rs 1059.14 crore (13.1 per cent margin) in Q1-2015. During the period under consideration, HUL’s highest PAT was in Q1-2013 at Rs 1331.19 crore (20.9 per cent of TIO), both in terms of absolute rupees and in percentage of TIO. While PAT in absolute rupees shows a linear increasing trend as indicated by the broken pink trend line in Fig B below, while in terms of percentage of TIO, the linear trend is declining as indicated by the broken yellow line.

Company Speak

During the quarter, the Domestic Consumer business grew at five per cent, with seven per cent underlying volume growth. The growth in the quarter continued to be impacted by the phasing out of Excise Duty incentives and price de-growth, as the benefit of lower commodity costs was passed on to consumers.

Soaps and Detergents: Robust volume growth partially offset by price deflation. Skin Cleansing was driven by double digit volume growth on Dove, Pears, Hamam and Lifebuoy. The liquids portfolio registered another robust quarter.

In Laundry, growth was led by the premium segment, with Surf maintaining its strong momentum and Rin accelerating post relaunch. Comfort Fabric Conditioner delivered another strong performance on the back of sustained market development. Household Care growth was driven by Vim, with the tubs and liquids portfolio doing well. The segment witnessed further price deflation in the quarter due to soft commodity costs.

Personal Products: Healthy double digit growth

Skin Care delivered broad based growth across Fair and Lovely, Pond’s, Lakme and Vaseline. Fair and Lovely continued to do well, while the performance of Pond’s was led by premium skin lightening and Lakme by Perfect Radiance and CC Cream. The facial cleansing portfolio sustained high growth.

Hair Care maintained its momentum with another strong quarter of volume led double digit growth, as Dove growth accelerated and TRESemmé gained further ground.

In Oral Care, Close Up registered double digit growth on the back of impactful activation.

In Colour Cosmetics, Lakme delivered another quarter of innovation led double digit growth across the core, Absolute and 9 to 5 ranges.

Beverages: Steady performance

Tea growth was led by Red Label and another quarter of high growth on Lipton Green Tea, driven through impactful market activation. In Coffee, Bru Gold continued to lead category premiumisation and performed well.

Packaged Foods: Eighth successive quarter of double digit growth

Packaged Foods saw double digit growth across all key brands, driven by the continued focus on market development. Kissan sustained robust activation led growth across both Ketchups and Jams while Knorr growth was led by the strong performance on Instant Soups. In Ice Creams, Kwality Walls had a good quarter on sharper in-market execution and Magnum continues to perform well and delight its consumers.

Water: Leadership sustained in a challenging market context In a soft market, Pureit continued to drive the performance of premium devices with a focus on Modern Trade and in-store execution. The business benefited from a strong performance in the e-commerce channel.

The Board of Directors have declared an interim dividend of Rs 6.5 per equity share of face value Re 1 each, for the year ending 31 March, 2016.

October 19, 2015
“We need leaders who have a point of view on future:” HUL’s Harish Manwani

MUMBAI: At the 82^nd Annual General Meeting held at Mumbai today, Hindustan Unilever Limited (HUL) chairman Harish Manwani informed shareholders about the imperative for companies to adopt an inclusive approach to serve and thrive in a country as diverse as India.

He also underlined the need for corporate India to be a part of the solution for the many challenges that lie ahead to reap the rewards of the India opportunity.

HUL – a part of the India growth story

In the speech titled ‘Serving Many Indias’, Manwani spoke about how HUL participated in India’s growth agenda over the years with the firm belief that ‘what is good for India is good for HUL.’

He spoke about how HUL’s growth and evolution has reflected the needs and development of India. He elaborated on how the company took the lead at critical junctures when the country needed the support of businesses to contribute to the national cause, be it its pioneering initiatives towards integrated rural development or manufacturing investments in backward areas as well as its renowned leadership and skills development programmes.

Manwani said, “At HUL, we have a simple model to ensure that we leverage the full opportunity that India presents by serving the many Indias within the country. This is essential for the long term growth of the company and more importantly it also fulfils our commitment to contribute to India’s growth and development in an inclusive and sustainable manner.”

Serving many Indias

Manwani argued that serving many Indias essentially requires having a portfolio of brands that reach out to a wide section and ensures that everyone has access to the brands – rich or poor. “Through our operations, we create a virtuous circle which benefits every geography of India, and we build talent both in terms of leadership as well as skills across the value chain of our operations,” he said.

Speaking about the need to serve diverse consumers, he stated, “Our approach of developing innovations with consumer price as the starting point is at the heart of our inclusive innovation strategy.”

He stressed on HUL’s extensive sales and distribution network which helps the company reach diverse markets in India making its brands available in every single town and most villages in India. HUL, while is leveraging technology to reach out to consumers in the most remote and media dark villages, it is also engaging with the digital media savvy urban youth who are increasingly making their buying decisions online.

Speaking about the recently introduced operating framework ‘Winning in Many Indias’ (WiMi), he said that this was a major organisational transformation that HUL embarked on with the underlying objective of winning in all parts of the business and across channels and geographies.

Under this framework, HUL has segmented the market into 14 consumer clusters that are homogeneous and added a fifth branch in Central India, an underpenetrated but high-potential region.

“This model helps us serve our diverse consumer base in a more differentiated and relevant way across the country,” he said. He also gave the example of how West Bengal enjoyed a higher concentration of consumers of premium beauty products. “This knowledge allows us to differentiate our marketing efforts in each of the regions and meet the needs of our consumers more effectively,” he added.

Serving diverse communities

Manwani further spoke about how HUL’s wide manufacturing base of 30 factories across India has helped create industrial ecosystems and enhance livelihoods in the communities around them.

“Our wide manufacturing footprint has opened up unique opportunities to reach out to communities and build on our larger purpose, which is to make sustainable living commonplace,” he said.

He spoke about ‘Prabhat’, a community development initiative running across HUL’s manufacturing units, which focuses on promoting health and hygiene, enhancing livelihoods and water conservation in and around HUL factories.

“HUL’s experience of developing the local ecosystems around its manufacturing units, offers a perspective on just how well the ‘Make in India’ agenda can be scaled across the country to make a difference,” he added.

Developing inclusive talent

In his speech, he also addressed the issue about the need for companies to have an inclusive people agenda to be able to successfully serve the many Indias. “Building employable talent is key to securing the long-term socio-economic progress for India. This is an agenda that has to be addressed by the government as well as corporate India. We need to equip the youth with the required skills to enable them to reap the economic benefits of India’s development,” he said.

Manwani highlighted how HUL was endeavouring to develop skills and capabilities of people across its value chain, from the smallholder farmers to its suppliers, distributors and factory workers. He gave examples of various programmes that the company has taken up for capability building among factory workers.

He cited the example of ‘Stepping into One’ programme that develops technical and leadership skills among shop floor employees, providing them with career advancement opportunities into supervisory roles. “It is initiatives like these that help to drive our efforts to develop talent in an inclusive and sustainable manner,” he added.

He further argued for the need for leaders who have the vision to understand the challenges and leverage the opportunities that a country as diverse and complex as India presents. “We need leaders who have a point of view on the future. We need leaders who can combine the right values and vision to drive inclusive growth so that we not only deliver sustainable growth but also serve the many Indias at the same time,” he said.

Serving India through sustainability

He mentioned about how the low human development index in India was a barrier for socio-economic progress which denied millions of people access to a decent standard of living. “Fundamental to inclusive growth and serving many Indias is providing the basic needs of health, hygiene, nutrition and a clean environment,” he said.

Manwani spoke about how businesses, which work alongside the government to address social and environmental challenges, will thrive in the long term. “It is this belief that led us to launch the ambitious Unilever Sustainable Living Plan (USLP) in 2010 which aims to double the size of our business while decoupling our growth from our environmental impact and increasing our positive social impact. The USLP lies at the heart of our business model and is firmly embedded across every part of the organisation,” he said.

Manwani elaborated on the various social and environmental initiatives that HUL has taken up as a part of USLP and how these were helping address some of the basic challenges that India faces.

Speaking about Lifebuoy’s behaviour change model for handwashing with soap to help prevent child mortality due to diseases like diarrhoea and pneumonia, he said, “We have already helped over 60 million people through our various handwashing programmes. Last year, we entered into a partnership with Children Investment Fund Foundation and the Government of Bihar to promote handwashing behaviour change among children in Bihar. The main aim of the programme is to help prevent childhood illness and mortality. We piloted the programme in two districts of Bihar – Begusarai and Khagaria, reaching out to nearly one million people. We are scaling up this initiative and over the next three years, we expect to reach out to an additional 45 million people,” he concluded.

June 29, 2015
FY-2015: HUL marketing spends up 7.2%; Q4-2015 marketing spends cross Rs 1000 crore

BENGALURU: Indian FMCG giant Hindustan Unilever Limited (HUL) Advertisement and Promotions expense (marketing spends, ASP) in FY-2015 was 7.2 per cent more at Rs 3874.94 crore (12.6 per cent of Total Income from operations or TIO, approximately $590 million) than the Rs 3613.609 crore in FY-2014.

For the fourth quarter ended 31 March, 2015 (Q4-2015, current quarter), the company exceeded the Rs 1000 crore (approx. $156 million) mark to clock Rs 1027.89 crore (13.4 per cent of TIO, approx. $160 million). ASP in the current quarter was 22.3 per cent more than the Rs 840.34 crore (11.8 per cent of TIO) in the corresponding year ago quarter and was 5.2 per cent more than the Rs 977.12 crore (12.6 per cent of TIO) in Q3-2015.

Note: (1) 100 lakh = 100,00,000 = 1 crore = 10 million.

(2) All figures in this report are standalone figures filed by the company. The trends are based on the numbers submitted by the company or picked up from the company’s website. For performance of HUL’s various product lines please refer to the attached earnings release for Q4-2015 and FY-2015.

(3) The US dollar figures are approximately based on a conversion rate of 1$= Rs 64.The converted numbers have been rounded off.

HUL chairman Harish Manwani said, “We have delivered another year of strong performance with broad based growth ahead of the market and sustained margin improvement. Our strategy remains focused on strengthening the core of our business through innovation, leading market development and continuous improvement of our executional capabilities. Despite market challenges, our strategic agenda remains unchanged as we continue to manage our business even more dynamically for growth that is consistent, competitive, profitable and responsible.”

As a matter of fact, HUL’s ASP in Q4-2015 is the highest over a 12 quarter period starting Q1-2013 until the current quarter in terms of absolute rupee spends at Rs 1027.89 crore. In terms of percentage of TIO, during the period under consideration, ASP was 13.8 per cent of TIO in Q2-2014 at Rs 954.02 crore. Please refer to Fig A below.

HUL’s ASP in absolute rupees shows a linear increasing trend during the 12 quarter period under consideration. The blue broken trend line intercepts Q4-2015 at Rs 995.876 crore, showing that the company has spent Rs 32.014 crore more than indicated by the trend line’s slope.

HUL’s ASP in terms of percentage of TIO in Q4-2015 at 13.4 per cent is in excess of the 12.6839per cent represented by the slope of the orange broken trend line during the period under consideration.

HUL TIO in FY-2015 at Rs 30805.62 crore (approx. $4.8 billion) was 9.9 per cent more than the Rs 28019.13 crore in the previous year. In Q4-2015, TIO at Rs 7675.63 crore was 8.2 per cent more than the Rs 7094.10 crore in Q4-2014, but was 1.3 per cent lower than the Rs 7774.32 crore in the immediate trailing quarter. Please refer to Fig B below. The orange broken trend line indicates that TIO has a linear increasing trend during the 12 quarter period under consideration in this report.The slope of the line indicates that HUL should have had a higher TIO of Rs 7856.14 crore and hence underperformed by Rs 180.51 crore (about $28 million).

HUL PAT in FY-2015 at Rs 4315.26 crore (14 per cent of TIO, approx. $675 million) was 11.6 per cent more than the Rs 3867.49 crore in FY-2014. For Q4-2015, PAT at Rs 1018.08 crore (13.3 per cent of TIO) was 16.7 per cent more than the Rs 873.13 crore (12.3 per cent of TIO) in Q4-2014, but was 18.7 per cent less than the Rs 1252.17 crore(16.1 per cent of TIO) in Q3-2015.

In Fig B below, the maroon broken line indicates that PAT in absolute rupees shows a linear increasing trend during the period under consideration. The slope of the line indicates that the HUL should had have had a higher PAT of Rs 1131.504 crore in Q4-2015 and hence underperformed by Rs 113.42 million ($18 million)

In terms of percentage of TIO, the green broken line indicates a linear decreasing trend. The slope of the line indicates that HUL’s actual PAT as percentage of TIO of Q4-2015 at 13.3 per cent is higher than the calculated 13.12 per cent.

HUL’s board of directors at its meeting held on Monday, 8 May, 2015 recommended a final dividend of Rs 9 per share of Re1 each, for the financial year ended 31 March, 2015. Together with the interimdividend of Rs 6 per share paid on 3 November, 2014, the total dividend for the financial year ended 31 March, 2015 works out to Rs 15 per share of Re 1 each. Final dividend, subject to approval of shareholders, will be paid on or after Friday, 3 July, 2015.

May 11, 2015
HUL emerges as numero uno employer of choice for fourth successive year

MUMBAI: As per the latest Nielsen Campus Track-B School Survey, Hindustan Unilever Limited (HUL) has emerged as the No. 1 Employer of Choice across all sectors for the 2015 graduating batch of B-School students, across functions for the fourth year in a row.

In addition, HUL retains the ‘Dream Employer’ status for the sixth year running and continues to be the top company considered for application by B-School students. HUL has also been ranked No. 1 for marketing as well as No. 1 FMCG in finance. This is the 15th year of the Nielsen Campus Track B-school study.

This achievement is recognition by students of the consistent actions HUL has taken over the years to build mutually beneficial relationships and engagements with the student and academic community.

HUL’s strong employer value proposition is rooted in its unique positioning as a “Leadership Factory” – offering big jobs early on in career to groom for functional and business leadership responsibilities. With its robust talent systems and processes, HUL identifies talent early and invests to build capability.

The company also offers a rigorous Summer Internship Programme, where interns go through an enriching learning experience by managing live projects that have a direct and huge impact on the business. In 2014, over 51 per cent interns completed projects at international locations in Unilever. HUL is also one of the first to announce Pre-Placement Offers (PPO) for interns across campuses.

HUL has a clearly defined career philosophy, which revolves around job rotation and diversity of experiences at all stages of the individual’s career. Internationalisation is also built in and currently around 200 HUL managers have been expatriated to other Unilever countries.

India offers an incredible opportunity. The sheer size and the growth prospects make it an exciting place for HUL. Growing incomes and the changing attitudes to consumption will mean that India is likely to see strong growth for several years to come. In that situation, HUL is very well positioned. Its current leadership positions, size, scale and strong brands position HUL perfectly to leverage this opportunity and make a real difference in this country.

The company also has a rigorous and transparent people planning process, which is owned by leaders at each level who review and assess talent on both the “What” and the “How’” of performance through an objective process. Capability building and career plans for talent form an integral part of this process.

Leadership development at HUL is about building leaders through a combination of disciplined routines and processes, and something not always evident from outside: a collective expertise, honed through practice, in recognizing and developing talent. This has established HUL as a source of leadership talent, both for Unilever globally and in industry in general.

Recognizing the importance of leadership in the larger communities, HUL has also been extending its role in building and harnessing leadership amongst the student community. Senior leader campus interactions with students to share leadership perspectives and insights and leadership development program and intervention for student leaders are part of this larger initiative, which has created great visible impact on students.

March 19, 2015
Google India launches #TogetherOnline initiative

MUMBAI: In its efforts to gather support for more women to get on the Internet, Google India has launched an initiative #TogetherOnline in association with Snapdeal, Axis Bank, HUL and GSK. The new initiative aims to encourage Internet users to step up and help women get on the Internet and understand how she can use the web to get ahead in life.

The nine week along initiative, will see a number of activities across India, starting with a concert with Farhan Akhtar to raise awareness amongst the youth in metro cities. Axis Bank will host special digital literacy workshops for women customers in their branches across India, whereas Snapdeal will run awareness campaigns amongst its shoppers and educate women on the entrepreneurial opportunities on their platform. To take the initiative to interiors of India, Google will also launch 500 custom designed Internet carts that will reach out to 5000 locations to engage women in towns and villages across India.

Google India director marketing Sandeep Menon said, “Internet has completely transformed the way we live our lives. Everyday people are discovering new opportunities and finding newer and better ways of doing things on the web to get ahead in life. We want to encourage all these users to extend this power of the web to women in India. #togetheronline is an effort to empower women in India with the knowledge of Internet and how they can use it to do different things in their daily lives. We along with our partners will host a number of initiatives to play our part and we invite all Internet users to play their part and help get more women online.”

In addition to this, Google has partnered with PopXo to cover easy to know and follow steps for day to day living for various categories. The aim of this partnership is to promote digital literacy amongst women.

Axis Bank group executive and head – retail marketing Rajiv Anand said, “As Axis Bank, progress is a part of our identity, our DNA. And we believe that empowering women is integral to the progress of our society. With the Indian woman today transforming from being a key influencer to a decision maker, it is important for her to be empowered with information. We are proud to be championing this cause in association with Google, to bring knowledge at the click of a button and help get more and more Indian women online.”

GSK Consumer Healthcare India marketing head Prashant Pandey added, “The bond between mothers and daughters has always been a unique and everlasting one. From 1896, Horlicks has been helping mothers make their daughters tall, strong and sharp. Today we are delighted to partner Google for their ‘Helping Women Get Online’ – an initiative that encourages daughters to help their mothers go online to stay aware and connected. This is yet another way of saying #LoveYouMaa like our recent digital film celebrating the universal truth that only mothers can give what they don’t have.”

Google has already introduced a number of initiatives to help get more women online through partnerships with various state governments and outreach efforts in the states of Madhya Pradesh, Tamil Nadu, Maharashtra, Uttar Pradesh and more recently in Andhra Pradesh. Under the helping women get online initiative, Google has imparted basic Internet training across 950 educational institutes training over 45,000 girl students and over 5000 teachers who can continue to educate and inform more girl students across India.

March 17, 2015
Q3-2015: HUL marketing spends up 5 per cent at Rs 977 crore

BENGALURU: Indian FMCG giant Hindustan Unilever Limited’s (HUL) Advertisement and Promotions expense (ASP) in Q3-2015 at Rs 977.12 crore (12.6 per cent of Total Income from operations or TIO) was 5.1 per cent more than the Rs 929.46 crore (12.9 per cent of TIO) in the corresponding quarter of last year and 5.6 per cent more than the Rs 925.05 crore (12.1per cent of TIO) in Q2-2015.

During the nine month period ended 31 December 2014 (9M-2015) the company’s ASP at Rs 2807.05 crore (13.3 per cent of TIO) was 2.7 per cent more than the Rs 2773.26 crore (12.5 per cent of TIO) during 9M-2014.

Note: (1) 100 lakh = 100,00,000 = 1 crore = 10 million.

(2) All figures in this report are standalone figures filed by the company.

The company reported a 7.6 per cent y-o-y jump in TIO in Q3-2015 to Rs 7774.32 crore from Rs 7223.35 crore in Q3-2014 and just a meagre 1.8 per cent increase from the Rs 7639.33 crore in Q2-2015. YTD, HUL’s TIO at Rs 23129.98 crore was 10.5 per cent more than the Rs 20925.03 crore in 9M-2014.

Fig A below shows the ASP trend of the company over an eleven quarter period starting Q1-2013 until the current quarter Q3-2015. In terms of absolute rupees, ASP shows an upward linear trend with the current quarter’s ASP being the highest. ASP in Q2-2013 (Quarter ended 30 September 2012) at Rs 768.98 crore (12.2 per cent of TIO). ASP in terms of per centage of TIO was highest in Q2-2014 at 13.8 per cent (Rs 954.02 crore), while the lowest ASP in terms of per centage of TIO was in Q4-2014 at 11.8 per cent (Rs 944.88 crore). The company’s ASP in terms of per centage of TIO shows a declining trend.

Fig B below indicates HUL’s TIO and PAT trends during the above mentioned eleven quarter period. The company’s TIO shows an upward linear trend with the current quarter’s TIO highest and TIO during Q2-2013 being the lowest at Rs 6318.81 crore. During the period under consideration, TIO in Q1-2015 registered the highest q-o-q growth at 8.8 per cent to Rs 7716.34 crore from Rs 7094.10 crore in Q4-2014. TIO in Q4-2014 registered the sharpest drop at 1.8 per cent from Rs 7223.35 crore in Q3-2014 during the same eleven quarter period.

HUL recorded an increase of 17.9 per cent in PAT to Rs 1252.17 crore (16.1 per cent of TIO) in Q3-2015 from Rs 1062.31 crore (13.3 per cent of TIO) in Q3-2014 and a 26.7 per cent increase from Rs 988.16 crore (12.9 per cent of TIO) in Q2-2015. During 9M-2015, PAT grew 10.1 per cent to Rs 3297.17 crore (14.3 per cent of TIO) from Rs 2995.36 in 9M-2014. In terms of per centage of TIO, as well as in absolute rupees, HUL’s PAT was highest in Q1-2013 at 20.9 per cent and Rs 1331.19 crore. While PAT shows a slight linear decline in absolute rupees during the period under consideration, in terms of per centage of TIO, the linear decline is more marked.

Kotak Securities FMCG analyst Ritwik Rai said, “HUL’s Q3-2015 results disappointed as volume growth (3 per cent, y-o-y) missed our estimates (5 per cent estimate). The company has reported that its volume and value growth remains ahead of the sector. Gross margins expanded in line with expectations. Excluding one-time provisions in employee expenses, the reported EBITDA came in 5 per cent below our estimates. We would expect that sales growth of the company shall pick up in the coming quarters, as lower inflation, improved sentiment help lift volume growth. Benefits of lower commodity prices are visible in the quarter, and will continue to be a useful tailwind for the company. The stock could see some near-term pressure, given sharp run-up in recent sessions and disappointing Q3-2015 results. However, our medium-term view on the stock remains constructive.”

HUL chairman Harish Manwani added, “We have delivered another quarter of competitive growth and margin improvement. We continue to strengthen the core of our business and drive the competitiveness of our brands in the market. At the same time, we are leading market development in relatively nascent categories such as packaged foods and premium personal care with strong results. Given the fast changing external environment, we are managing our business dynamically for sustained volume led growth and margin improvement.”

January 21, 2015
Effies 2014: It was the night of ‘Men in Black’

MUMBAI: The stage was set as the who’s who of the advertising world ascended to celebrate the best work of the year gone by at the Effies 2014.

“The Gold standards we are have set will secure that these awards are the most coveted and the most admired in our communication business,” said the Ad Club president Pratap Bose in his opening speech, while emphasising that the results will have the direct implications on 2015 Global Effie rankings at the individual office level. “And I must share that two out of three in 2014 global ranking are from India,” he added.

Amidst loud cheering, Ogilvy & Mather, which was superseded by Lowe Lintas + Partners in the race last year, was back with a bang to be the Agency of the Year at the Effie 2014 awards.

The men and women in black earned a total of 173 points and bagged two Gold, eight Silver, and 16 Bronze Effies. Bournvita (Best on-going campaign category) and Google (Digital: Online/Mobile Communication category) took home the two Golds.

Last year’s winner Lowe Lintas + Partners came in second with 142 points. The agency won the maximum number of Gold medals i.e. seven along with six Silver and eight Bronze Effies.The Gold wins for the agency came for Idea and Tata Tea (Best on-going campaign category). The work for Idea also won a Gold in the Services category.

McCann Worldgroup India came in third with 90 points earned from two Gold, five Silver and eight Bronze. There was a tie between JWT and Soho Square with 34 points. The agency bagged Gold for Havells’ #RespectWomen entry (Consumer Durables category).

Hindustan Unilever with a total of 64 points including two Gold, four Silver and four bronze Effies became the Effie Client of the Year.

The Grand Effie went to Soho Square for its campaign ‘The Political campaign that Created History’ for Bharatiya Janata Party.

Click here for the winners list

January 17, 2015
In October, ASCI upholds complaints against 105 out of 146 ads

MUMBAI: In October, Advertising Standards Council of India’s (ASCI) Consumer Complaints Council (CCC) upheld complaints against 105 out of 146 advertisements. Out of the 105 advertisements against which complaints were upheld, 44 belonged to personal and healthcare category, followed by the education category with 43 advertisements.

Some of the health care products or services advertisements also contravened provisions of the Drug & Magic Remedies Act and Chapter 1.1 and III.4 of the ASCI Code. Complaints were upheld against Hindustan Unilever Ltd’s advertisement of Fair & Lovely which claims that the product marketed in India gives better results than other fairness creams marketed in Dubai, Singapore and Japan stating a comparison versus “some of the world’s best products.” The advertisement is misleading by exaggeration and implication that the advertised product is unbeatable with all the products in those countries. Also the advertisement is likely to be misleading by ambiguity as the comparison is only for instant whitening effect of the advertiser’s product.

Similarly, the advertisement of Wockhardt Hospitals claims, “Best in Healthcare” and “Best in Bariatric Surgery.” The advertisement is misleading as the Registration Certificate of the doctor shows his registration only as MBBS and not a specialist (MS). Also, the advertisement is in breach of Code of Medical Ethics as the advertisement mentions the name of Dr. Bhandari promoting the Hospital which is in violation of the Medical Council of India (MCI) Code of Ethics Regulations 2002 Clause 6.1.

Also, the advertisement of Dabur Range of Product claims “Do you have the energy of Shilajit Gold?” & “Shila X Oil – Full of energy”, were not substantiated. Also, when read in conjunction with the visual in the advertisement and specific to the advertisement claim, “Shila X Oil – Full of energy”, the advertisement is in breach of the law as it violated The Drugs & Magic Remedies Act.

In the education category, CCC found that advertisements violated ASCI Guidelines for Advertising of Educational Institutions and upheld complaints against the advertisement by AKS University that claims it is the best university. The claim was not qualified with appropriate disclaimers and many others.

In the e-commerce category, complaints were upheld against the advertisement of Flipkart.com that claimed to offer ‘Flat 90 per cent’ off which was misleading as the TVC did not mention that the offer is on limited stock. Similarly, Jasper Infotech’s Snapdeal.com advertisement a boy is telling the audience that my girlfriend’s sister is very cute. When we go outside she always comes with us, absolutely free. Just like Snapdeal Diwali bumper sale in which a product is absolutely free with another. The TVC makes a derogatory reference to women and refers to women as a commodity.

The others against whom complaints were upheld included the advertisement claims that Hindustan Hindi Daily is the number one newspaper of Jharkhand. The claim contravened the ASCI Guidelines on Supers; the advertisement of Tata Docomo Photon Max Wi-Fi claims, “Consistent high speeds” which was not substantiated with test reports from independent third party. Also, the Advertiser did not provide substantiation of actual speed achieved in real conditions and in several locations within the cities quoted in the advertisement; Viacom 18 Media (Sonic Power Rangers) advertisement shows teenagers in uniform climbing the walls of their education institution and doing somersaults while entering the class. As the advertisement shows dangerous acts which are likely to encourage minors to emulate them in a manner which could cause harm or injury, the complaint was upheld under Chapter III 2b) of the ASCI Code.

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December 8, 2014
“I am a firm believer of strengthening what we have already started”: Sudhanshu Vats

Over the past seven years, Viacom18 has grown to be one of the bigger conglomerates in India. The JV which started off as a partnership between Viacom International and Network18’s subsidiary TV18 and is now a JV between Viacom and Reliance Industries which has taken over Network18 has grown out of just a broadcasting business into a film and live events business.

At the helm of it is Viacom18 group CEO Sudhanshu Vats who joined the company nearly three years ago after a double decade long stint at Hindustan Unilever Limited (HUL). Energetic and dynamic, Vats has a belief of uniting the entire Viacom18 channels and departments into ‘one Viacom18’.

Spending much of his career at HUL, Vats still thinks from a consumer perspective. Speak to him now of content and he will first think of what the consumer is doing. On the occasion of the completion of seven years of the company, he speaks to indiantelevision.com’s Meghna Sharma and Vishaka Chakrapani about the growth of the company and where it is headed.

Tell us about the seven year journey.

When Viacom18 was formed seven years ago, there were only three channels MTV, Vh1 and Nick, and now we have 10 channels. That is an expansion in our broadcast business. We have also entered the film entertainment business through Viacom18 Motion Pictures in 2011. About a year and half ago, we got into experiential/live entertainment business. So now we have broadcast, films and live entertainment under our wings. We began our journey at about Rs 100 crore. In the last seven years we have grown 20 times.

A significant milestone is that we have turned PAT profitable in FY-14. That was our first year of PAT profitability at Viacom18. It’s important to not only grow exponentially but also profitably. Profitable growth is sustainable and gives you fuel for investment.

What’s your growth strategy?

I am a strong advocate of sharper segmentation. The more I think about it, the more I am convinced. Let us start from a consumer point of view. What is happening in India is that the country is urbanising at a very fast pace, income levels are growing, people are becoming more aware. Urbanisation is happening more rapidly than we see because it goes beyond the tangible phenomenon of growth in cities / urban habitats, attitudinally India is urbanising at a rapid pace.

Prime Minister Shri Narendra Modiji’s campaign is all about tapping in to the mindset of urban Indian youth who may not stay in urban India but has a mindset of aspiration, opportunity, development, fair play, which is universal. From the point of view of content, we see that when we move from rural to urban we move from a “We to I” mindset and develop a stronger individual identity. So we want to customise content for every Indian. In the utopian sense 1.2 billion people want 1.2 billion packages. Are there screens available to consume content? Yes 900 million. Is there capacity to carry content? Yes, with the digitisation of cable network and planned growth in broadband and 3G/4G we are building sufficient capacity in the content pipes. With consumer desiring more and more content it can’t be the same/similar content being churned out. So sharper segmentation is needed.

In each of the genres we exist, we will segment further and deepen our presence. We will continue to look at adjacent genres. We have Colors and Rishtey in Hindi GEC. Post legal and regulatory clearances, we will have a strong presence of Viacom18 in regional GEC genre as well.

Within Colors, a few years ago we didn’t have comedy sub-genre and we now have Comedy Nights with Kapil – and that’s a hit. We are also looking at other sub-genres. It’s about providing a spectrum of options to viewers within the channel.

Was moving into movies an alternative to launching a movie channel?

When we look at movies, we look at whether there is a consumer case, and also a commercial case. Movies have about a 13-14 per cent viewership according to TAM. So there is a consumer case. However a movie channel isn’t differentiated enough. We aren’t so sure if there is a commercial case for us, given the rising acquisition rights for films.

What about a sports channel?

Sports is a genre that we aren’t looking at in the short- to medium-term. If you look at the consumer case again people are watching a lot of cricket. But even in that, it’s a 0-1 situation. When India is playing international cricket or it is a short form game, viewership is huge but the moment India isn’t playing, or it is test cricket, viewership drops. At the same time viewership for domestic cricket is very poor. For other games, viewership will take time to develop.

It is a genre which has promise in the future. But it is a long gestation game. It needs deep investment and commitment.

Leagues are increasing in number. Where do you see them going?

Leagues are an interesting development where players are finding a sweet spot between sports and entertainment. Is it a promising place in the future? Perhaps yes. All this depends on the journey of the company. For Viacom18, I think there is enough and more to be done in deepening our current genres or entering identified adjacent genres. Our focus should be to strengthen the same. Having said that, we will continue to evaluate all opportunities from time to time.

How is the business of Live Viacom18 doing? A few months ago it was bringing in 2 per cent of your revenue. What is it now?

This year we should be at about 4 per cent of our total revenue. Live entertainment is the place where we start getting straight into the wallet of the consumer. It broadens our revenue streams – first is advertising, second is subscription and third is direct share of the wallet. In urban India, this phenomenon will grow rapidly. Particularly in certain genres like music, there is nothing to beat live entertainment. Other forms of entertainment are passive. So if you see in EDM or Bollywood dance music, we have two properties – Vh1Supersonic and MTV Bollyland. I am equally keen on the kids genre. The entire piece on experiential entertainment is a good space. We want to surely reach 10 per cent in future.

Are you expanding the number of events that you have?

Last year Vh1Supersonic was a standalone property. This year we are doing arcades and mini events in big towns- Bengaluru, Mumbai, Delhi with three artists. We have taken Vh1 Supersonic gigs to 50+ clubs and hundreds of colleges. With MTV Bollyland, we went deeper to mini-metros and towns with 1 million + populations – in fact it’s going to be 12 towns this year. We are also taking the IP outside India with the first event soon to be held in Dubai.

Will there be any more additions to the list?

I am a firm believer of deepening and strengthening what we have already started. For Colors, we will evaluate as we move forward, because we do a lot of non-fiction shows and the genre lends itself very well to live events.

How has your ad inventory grown due to the 12 minute ad cap rule?

A 12-minute ad cap for pay TV is a step in the right direction – it improves viewer experience. The viewer wants quality content and while he or she may want to watch some advertising, the problem lies in the fact, that there are cases when advertising outweighs the content duration. In future good content will command a premium on the 12-minute ad inventory. In India ad rates are under-indexed, possibly amongst the cheapest in the world, so there is a lot of room for growth. Colors, MTV, Nick, Vh1 and Comedy Central have successfully improved ERs. Across our genres our attempt will be to get good content that leads to higher viewership and better rates.

What is the network’s take on geo targeting?

The pilot has been conducted in the kids’ cluster. It’s a clear win-win situation for both broadcaster and advertiser, therefore it gives us confidence to scale it up across genres. While the FMCG sector will derive a lot of value, other sectors also stand to benefit from this. In addition geo-targeting will help us tap newer clients and local advertisers in future.

What is the state of carriage fees? Has it come down or is it still on an upward swing?

Overall carriage has come down in the past two years. The broad understanding was that with digitisation there would be no carriage at all. So it hasn’t come down as much as we would have liked it to. This is due to the lack of addressability of the consumer/viewer. No wonder then, that carriage, rather than continually coming down, has begun to rise again in recent months. As we move forward, MSOs would need to drive revenues and collections from the subscribers, thereby reducing /eliminating dependence on carriage.

What about the unequal advertising/subscription skew in India?

Worldwide ad subscription revenue tends to be almost equal. Like many things in India, change for the better is slow but gaining momentum.

What best practices does Viacom18 need to grow?

The next growth phase requires that we build capacity in talent, systems and processes and invest behind key strategic opportunities. Capacity building especially in processes and systems is an ongoing journey. We have begun to lay greater emphasis on analytics, automation and processes such as ERP. They are being implemented at Viacom18. We have focused leading brands in each genre and this is unique to us. Finding the right balance between independence and interdependence is important, hence we are driving synergy as we grow. We are building greater interdependence – in our processes and in our culture.

We are hiring from colleges, as well as carrying out lateral hires. We constantly evaluate how best do we provide our people with new and exciting opportunities within the organisation. Finally, we also have a structured end-to-end approach to offer to our clients through our Viacom18 Integrated Network Solutions team. We offer a full bouquet of services to advertisers, who can partner with us on live events, broadcast, film integration – the entire spectrum of consumer connect.

November 15, 2014
HUL ranks number 3 globally among top companies for leaders

MUMBAI: Hindustan Unilever Limited (HUL) has been ranked third in 2014 Global Aon Hewitt Top Companies for Leaders survey.

HUL is the only Indian company that has been ranked in the ‘global top 10’ consistently since the ‘Top Companies for Leaders’ global survey was first launched in 2007. HUL’s ranking of number three globally this year is the highest ever ranking for any Indian company in the survey. HUL was ranked number one in the Top Companies for Leaders 2014 survey done by Aon Hewitt in India.

HUL CEO and MD Sanjiv Mehta said, “It is extremely satisfying to be recognised as number one in India and number three globally among other esteemed organisations. This recognition is also special as it comes at a time when we enter the 60th year of our Unilever Future Leaders Programme (UFLP), a flagship programme which has over the years groomed brightest young minds within HUL into business leaders.”

“At HUL we believe in inculcating a ‘Leaders build Leaders’ mindset and are committed to honing business and leadership acumen through a strong learning curriculum. Building thought leaders and leadership capability is an integral part of our talent principles and is a well articulated philosophy that we have been following for decades,” he added.

HUL is well-known for its talent pool and as a source of leadership talent. Not only does HUL have formal processes for inculcating leadership, but it also provides a culture of coaching and mentoring at every level in the organisation. The approach of identifying and grooming top talent has established the company as a source of leadership talent, both for Unilever globally and the industry in general.

Over 200 managers of HUL currently serve Unilever globally. There are several senior HUL managers working in leadership roles across Unilever markets and functions.

The Aon Hewitt Top Companies for Leaders study evaluates and recognises what it takes to execute best-in-class leadership and talent management around the world. This year’s winners were selected and ranked by a panel of independent judges, including well-known experts from Wharton School of Business, Indian School of Business, PUC Minas and Ivey School of Business using a number of criteria, including strength of leadership practices and culture, examples of leader development on a global scale, alignment of business and leadership strategy, business performance and company reputation.

Aon Hewitt’s analysis found that top companies shared five key characteristics in their leadership approach:

•      Assessment. When it comes to building leaders, top companies assess the whole leader early in their careers. This includes evaluating leaders’ experiences, competencies, values and organisational fit. This helps organisations understand the unique needs of their talent pipeline to fuel the right development solutions that move people forward faster.

•      Awareness. Top companies have leaders who demonstrate tremendous self-awareness by understanding their personal strengths and weaknesses and using this information to become more effective leaders.

•      Resilience. In today’s unpredictable and complex environment, top companies build resilience in their leaders by creating inclusive cultures where multiple perspectives and ideas are expected and fostered to help the organisation meet continued business challenges.

•      Engaging leadership. Organisations leading the way focus on identifying and building engaging leaders who are stabilisers, demonstrate versatility and stay connected to people and events inside and outside their organisation.

•      Sustainability. Aon Hewitt Top Companies for Leaders focus on building talent programs nimble enough to respond quickly to market demands, yet sustainable to deliver superior business outcomes.

November 15, 2014