Unpacking the E-Commerce Strategies of Kenvue, Nestlé and Unilever

July 2023

While e-commerce growth rates are normalising, the online channel remains a key one for brands, as retail becomes omnichannel. Riding this wave entails more than distribution. Brands must have a comprehensive digital shelf strategy, encompassing insights into online behaviour, inventory management, logistics, partnerships and new business models. This briefing explores the e-commerce strategies of three leading fmcg players.

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Key findings

Brands stretch beyond traditional distribution strategies as they champion e-commerce

Riding the e-commerce wave means more than merely distribution for fmcg brands. Devising and executing digital shelf strategies require new insights into the value chain, which include understanding consumer behaviour online, inventory management, logistics, partners and new business models.

E-commerce sales for most companies are steered by a champion category, while further opportunities remain untapped

Despite having wide product portfolios, most major fmcg companies seem to win on the back of a particular category, given their competitive advantages. While pet care steers online success for Nestlé, Unilever banks on its beauty and personal care products. For the more specialised firm Kenvue, consumer healthcare and personal care are the core of its online offer. Companies still have significant opportunities to tap into their secondary categories by finding new markets of growth and e-commerce partners, and through product development.

Seasonality remains a key factor that determines e-commerce growth for fmcg brands

Seasonality is a key aspect to strategise for fmcg brands in the online space. While seasonality also has an impact on offline sales, e-commerce performance is more sensitive to these shifts, given they impact both consumption and channel shifts. Developing an e-commerce strategy that hedges seasonal risks through portfolio diversification can yield greater levels of success.

Premiumisation and on-boarding digital native brands is an active strategy reshaping fmcg companies

For most fmcg companies, e-commerce is a business of thinner margins. Given that many leading fmcg brands are household names fulfilling mass needs, many are starting to differentiate through premiumisation and innovation. Notably, the acquisition of digital native and prestige brands is coming into play to address new consumer trends and capture value online. This is also changing the fmcg landscape, reflected in business reorganisation.

Scope
About the data used in this report
Key takeaways
Post-pandemic e-commerce growth rates have normalised
Retailers and brands need to refine e-commerce strategies to grow in the new landscape
Nestlé’s online fmcg success spotlights winning categories
A strong diversification of channels is key to Nestlé’s e-commerce strategy
Nestlé uses marketplaces for portfolio distribution across the globe
Seasonality and retailer strategies impact shifts in channel preference
Pet care is the star in Nestlé’s online portfolio
Purina’s e-commerce success contributes to Nestlé’s leadership in online pet care
Nespresso’s direct-to-consumer strategy strengthens brand equity
Grocery specialists remain key partners for Nestlé in online packaged food sales
Finding new sources of growth for ambitious e-commerce goals
Room for growth in new focus markets and strengthening competitive position in categories
What’s next?
Kenvue extends online channel across a diversified product range
Strength in the OTC segment reinforces Kenvue’s position online
Amazon offers the wider reach for Kenvue’s product portfolio
Walgreens is the leading online healthcare product retailer for Kenvue
Leading the way online, Neutrogena is the dominant brand for Kenvue
Kenvue banks on beauty and personal care products in most markets
Finding opportunity online through effective pricing in a challenged OTC market
Investing in telehealth start-ups to create new online channels
Strategic spin-off and a digital first approach to support product and brand innovation
What’s next?
Digital commerce is key to Unilever’s strategic growth plans
Unilever’s e-commerce channel mix sees prominence of grocery retailers and marketplaces
While generalists dominate as retail partners, market nuances determine category mix
Strong portfolio in beauty and personal care backs Unilever’s e-commerce performance
With strong digital marketing and brand trust, Dove leads Unilever’s brand portfolio
Unilever’s on-demand delivery division aims to meet the delivery needs of Generation Now
Investing in digital native brands drives new growth as Unilever pivots portfolios
Unilever aims to optimise packaging for e-commerce
Shift in seasonal consumption and inflationary challenges is a balancing act
What’s next?
Key takeaways
What will it take to win?
Watch industry experts debate the future trajectory of e-commerce
About Euromonitor International’s Syndicated Channels Research

Retailing

Retail is the sale of new and used goods to consumers from a business for personal or household consumption from retail outlets, kiosks, market stalls, vending, direct selling and e-commerce. Retail is the aggregation of Retail Offline and Retail E-Commerce. Excludes specialist retailers of motor vehicles, motorcycles, vehicle parts. Also excludes fuel sales, foodservice sales, rental transactions, and wholesale sales (e.g. Cash and Carry). Sales value excluding or including VAT/Sales Tax. Retail also excludes the informal retail sector. Informal retailing is retail trade which is not declared to the tax authorities. Informal retailing encompasses (a) sales generated by unregistered and unlicensed retailers, i.e. retailers operating illegally, and (b) any proportion of sales generated by a registered and licensed retailer that is not declared to the tax authorities. Unregistered and unlicensed retailers operate predominantly (although not exclusively) as street hawkers or operate open market stalls, as these channels are harder for the authorities to monitor than permanent outlets. Activities in the illegal market, which is usually understood to refer to trade in illegal, counterfeit or stolen merchandise, are included within our definition of informal retailing. Activities in the “grey market”, which is usually understood to refer to trade in legal merchandise that is sold through unauthorized channels – for example cigarettes bought legally in another country, legally imported, but sold at lower prices than in authorized channels – will be included as informal retailing if no tax is paid on sale by the retailer. However if the retailer pays tax – for example on cigarettes bought legally in another country but sold at a lower price than standard – the sale is included within formal retail.

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