Sales of shampoo and deodorant fall in lockdown while ice cream rises, Unilever reports
Consumer goods giant notes smaller dip in sales than expected in second quarter of 2020
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Your support makes all the difference.The coronavirus lockdown has resulted in new consumer behaviours, including a dip in demand for personal hygiene products and a rise in the sales of ice cream, Unilever has suggested.
The consumer goods giant said ice cream sales from brands such as Ben & Jerry’s have jumped by 26 per cent between April to June and it recorded strong “growth in home consumption of foods, ice cream and tea” as people spent more time indoors.
But the lack of social events meant people were less likely to spend on personal care products, with the demand for skincare, deodorants and hair care declining in both volume and price.
The firm noted a significant increase in the sales of hygiene products as people cleaned their homes and sanitised their hands more often in an effort to keep coronavirus at bay. According to a blog post by Unilever last month, people have more than doubled how often they clean and wash their clothes.
Sales in the second quarter of 2020 fell less than expected during the lockdown, surprising analysts who expected the firm’s performance to take a much bigger hit as restaurants, schools, shopping centres and other indoor and outdoor venues throughout the world were forced to close.
“Consumers eating and cleaning more at home, and focusing more on hand hygiene, led to underlying sales growth in North America of 9.5 per cent in the second quarter, despite a negative impact of 3.7 per cent from food solutions and Prestige channel closures,” said the company.
Overall, underlying sales fell 0.3 per cent in the three months ending 30 June, far from previous forecasts of a 4.3 per cent drop.
Graeme Pitkethly, chief financial officer of Unilever, told the Financial Times the second-quarter results showed “the resilience of the business” despite facing “probably the toughest [period] that we’ve ever seen”.
“We really do believe that talk about a quick recovery is at the optimistic end of the range,” he added.
Unilever also said on Thursday it will retain its tea businesses in India and Indonesia following a review, which was prompted by a decline in demand for black tea, and will separate the company’s remaining tea operations into a new business.
“The balance of Unilever’s tea brands and geographies and all tea estates have an exciting future, and this potential can be best achieved as a separate entity,” it said.
The separation process is expected to conclude by the end of 2021.
Additional reporting by agencies
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