Case Study Description of Unilever Canada: Redefining the AXE Brand
In 2015, AXE, one of Unilever's largest and most well-known personal care brands, was experiencing challenges in growing sales across its full product portfolio. Historically, AXE's unique activations and campaigns had been successful in generating high brand awareness and, ultimately, driving sales in Canada. However, sales growth had slowed over the past three years, and the AXE team wondered whether the brand's current messaging still resonated with consumers. The previous year, Unilever's global consumer insights team had conducted significant research to better understand the AXE consumer. The company now needed to prepare and present a client brief to AXE's advertising agency in preparation for a major 2016 campaign.
Swot Analysis of "Unilever Canada: Redefining the AXE Brand" written by Allison Johnson, Lisa-Marie Assenza includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Axe Axe's facing as an external strategic factors. Some of the topics covered in Unilever Canada: Redefining the AXE Brand case study are - Strategic Management Strategies, Manufacturing and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Unilever Canada: Redefining the AXE Brand casestudy better are - – customer relationship management is fast transforming because of increasing concerns over data privacy, supply chains are disrupted by pandemic , technology disruption, there is increasing trade war between United States & China, talent flight as more people leaving formal jobs, wage bills are increasing, increasing inequality as vast percentage of new income is going to the top 1%,
competitive advantages are harder to sustain because of technology dispersion, geopolitical disruptions, etc
Introduction to SWOT Analysis of Unilever Canada: Redefining the AXE Brand
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Unilever Canada: Redefining the AXE Brand case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Axe Axe's, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Axe Axe's operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Unilever Canada: Redefining the AXE Brand can be done for the following purposes –
1. Strategic planning using facts provided in Unilever Canada: Redefining the AXE Brand case study
2. Improving business portfolio management of Axe Axe's
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Axe Axe's
Strengths Unilever Canada: Redefining the AXE Brand | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Axe Axe's in Unilever Canada: Redefining the AXE Brand Harvard Business Review case study are -
Analytics focus
– Axe Axe's is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Allison Johnson, Lisa-Marie Assenza can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Highly skilled collaborators
– Axe Axe's has highly efficient outsourcing and offshoring strategy. It has resulted in greater operational flexibility and bringing down the costs in highly price sensitive segment. Secondly the value chain collaborators of the firm in Unilever Canada: Redefining the AXE Brand HBR case study have helped the firm to develop new products and bring them quickly to the marketplace.
Sustainable margins compare to other players in Sales & Marketing industry
– Unilever Canada: Redefining the AXE Brand firm has clearly differentiated products in the market place. This has enabled Axe Axe's to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Axe Axe's to invest into research and development (R&D) and innovation.
Ability to recruit top talent
– Axe Axe's is one of the leading recruiters in the industry. Managers in the Unilever Canada: Redefining the AXE Brand are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Successful track record of launching new products
– Axe Axe's has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Axe Axe's has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Effective Research and Development (R&D)
– Axe Axe's has innovation driven culture where significant part of the revenues are spent on the research and development activities. This has resulted in, as mentioned in case study Unilever Canada: Redefining the AXE Brand - staying ahead in the industry in terms of – new product launches, superior customer experience, highly competitive pricing strategies, and great returns to the shareholders.
Innovation driven organization
– Axe Axe's is one of the most innovative firm in sector. Manager in Unilever Canada: Redefining the AXE Brand Harvard Business Review case study can use Clayton Christensen Disruptive Innovation strategies to further increase the scale of innovtions in the organization.
Learning organization
- Axe Axe's is a learning organization. It has inculcated three key characters of learning organization in its processes and operations – exploration, creativity, and expansiveness. The work place at Axe Axe's is open place that encourages instructiveness, ideation, open minded discussions, and creativity. Employees and leaders in Unilever Canada: Redefining the AXE Brand Harvard Business Review case study emphasize – knowledge, initiative, and innovation.
High brand equity
– Axe Axe's has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Axe Axe's to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Low bargaining power of suppliers
– Suppliers of Axe Axe's in the sector have low bargaining power. Unilever Canada: Redefining the AXE Brand has further diversified its suppliers portfolio by building a robust supply chain across various countries. This helps Axe Axe's to manage not only supply disruptions but also source products at highly competitive prices.
Superior customer experience
– The customer experience strategy of Axe Axe's in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Strong track record of project management
– Axe Axe's is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Weaknesses Unilever Canada: Redefining the AXE Brand | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Unilever Canada: Redefining the AXE Brand are -
Products dominated business model
– Even though Axe Axe's has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Unilever Canada: Redefining the AXE Brand should strive to include more intangible value offerings along with its core products and services.
High cash cycle compare to competitors
Axe Axe's has a high cash cycle compare to other players in the industry. It needs to shorten the cash cycle by 12% to be more competitive in the marketplace, reduce inventory costs, and be more profitable.
High dependence on existing supply chain
– The disruption in the global supply chains because of the Covid-19 pandemic and blockage of the Suez Canal illustrated the fragile nature of Axe Axe's supply chain. Even after few cautionary changes mentioned in the HBR case study - Unilever Canada: Redefining the AXE Brand, it is still heavily dependent upon the existing supply chain. The existing supply chain though brings in cost efficiencies but it has left Axe Axe's vulnerable to further global disruptions in South East Asia.
Slow to strategic competitive environment developments
– As Unilever Canada: Redefining the AXE Brand HBR case study mentions - Axe Axe's takes time to assess the upcoming competitions. This has led to missing out on atleast 2-3 big opportunities in the industry in last five years.
Slow decision making process
– As mentioned earlier in the report, Axe Axe's has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Axe Axe's even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
Interest costs
– Compare to the competition, Axe Axe's has borrowed money from the capital market at higher rates. It needs to restructure the interest payment and costs so that it can compete better and improve profitability.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Unilever Canada: Redefining the AXE Brand, in the dynamic environment Axe Axe's has struggled to respond to the nimble upstart competition. Axe Axe's has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Slow to harness new channels of communication
– Even though competitors are using new communication channels such as Instagram, Tiktok, and Snap, Axe Axe's is slow explore the new channels of communication. These new channels of communication mentioned in marketing section of case study Unilever Canada: Redefining the AXE Brand can help to provide better information regarding products and services. It can also build an online community to further reach out to potential customers.
Need for greater diversity
– Axe Axe's has taken concrete steps on diversity, equity, and inclusion. But the efforts so far has resulted in limited success. It needs to expand the recruitment and selection process to hire more people from the minorities and underprivileged background.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Unilever Canada: Redefining the AXE Brand HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Axe Axe's has relatively successful track record of launching new products.
High bargaining power of channel partners
– Because of the regulatory requirements, Allison Johnson, Lisa-Marie Assenza suggests that, Axe Axe's is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Opportunities Unilever Canada: Redefining the AXE Brand | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Unilever Canada: Redefining the AXE Brand are -
Reforming the budgeting process
- By establishing new metrics that will be used to evaluate both existing and potential projects Axe Axe's can not only reduce the costs of the project but also help it in integrating the projects with other processes within the organization.
Developing new processes and practices
– Axe Axe's can develop new processes and procedures in Sales & Marketing industry using technology such as automation using artificial intelligence, real time transportation and products tracking, 3D modeling for concept development and new products pilot testing etc.
Redefining models of collaboration and team work
– As explained in the weaknesses section, Axe Axe's is facing challenges because of the dominance of functional experts in the organization. Unilever Canada: Redefining the AXE Brand case study suggests that firm can utilize new technology to build more coordinated teams and streamline operations and communications using tools such as CAD, Zoom, etc.
Better consumer reach
– The expansion of the 5G network will help Axe Axe's to increase its market reach. Axe Axe's will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Building a culture of innovation
– managers at Axe Axe's can make experimentation a productive activity and build a culture of innovation using approaches such as – mining transaction data, A/B testing of websites and selling platforms, engaging potential customers over various needs, and building on small ideas in the Sales & Marketing segment.
Using analytics as competitive advantage
– Axe Axe's has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Unilever Canada: Redefining the AXE Brand - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Axe Axe's to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Buying journey improvements
– Axe Axe's can improve the customer journey of consumers in the industry by using analytics and artificial intelligence. Unilever Canada: Redefining the AXE Brand suggest that firm can provide automated chats to help consumers solve their own problems, provide online suggestions to get maximum out of the products and services, and help consumers to build a community where they can interact with each other to develop new features and uses.
Low interest rates
– Even though inflation is raising its head in most developed economies, Axe Axe's can still utilize the low interest rates to borrow money for capital investment. Secondly it can also use the increase of government spending in infrastructure projects to get new business.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Axe Axe's can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Unilever Canada: Redefining the AXE Brand, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Axe Axe's can use these opportunities to build new business models that can help the communities that Axe Axe's operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Axe Axe's in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Axe Axe's to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Loyalty marketing
– Axe Axe's has focused on building a highly responsive customer relationship management platform. This platform is built on in-house data and driven by analytics and artificial intelligence. The customer analytics can help the organization to fine tune its loyalty marketing efforts, increase the wallet share of the organization, reduce wastage on mainstream advertising spending, build better pricing strategies using personalization, etc.
Threats Unilever Canada: Redefining the AXE Brand External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Unilever Canada: Redefining the AXE Brand are -
Technology acceleration in Forth Industrial Revolution
– Axe Axe's has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Axe Axe's needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Regulatory challenges
– Axe Axe's needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Sales & Marketing industry regulations.
Increasing wage structure of Axe Axe's
– Post Covid-19 there is a sharp increase in the wages especially in the jobs that require interaction with people. The increasing wages can put downward pressure on the margins of Axe Axe's.
Backlash against dominant players
– US Congress and other legislative arms of the government are getting tough on big business especially technology companies. The digital arm of Axe Axe's business can come under increasing regulations regarding data privacy, data security, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Unilever Canada: Redefining the AXE Brand, Axe Axe's may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Barriers of entry lowering
– As technology is more democratized, the barriers to entry in the industry are lowering. It can presents Axe Axe's with greater competitive threats in the near to medium future. Secondly it will also put downward pressure on pricing throughout the sector.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Axe Axe's will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Shortening product life cycle
– it is one of the major threat that Axe Axe's is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Consumer confidence and its impact on Axe Axe's demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
High dependence on third party suppliers
– Axe Axe's high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Axe Axe's can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Environmental challenges
– Axe Axe's needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Axe Axe's can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Weighted SWOT Analysis of Unilever Canada: Redefining the AXE Brand Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Unilever Canada: Redefining the AXE Brand needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Unilever Canada: Redefining the AXE Brand is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Unilever Canada: Redefining the AXE Brand is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Unilever Canada: Redefining the AXE Brand is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Axe Axe's needs to make to build a sustainable competitive advantage.
