Hindustan Unilever (HUL)'s decision to split its beauty and personal care division and place a renewed focus on digital has been driven by its aim to serve the consumer of tomorrow, say analysts and brand experts.
HUL managing director and chief executive officer Rohit Jawa is looking to make the company ‘future ready’, and while these bets are not for the short-term, they will eventually pay off as the Indian consumer is young and digital friendly, they add.
“Rohit Jawa comes with digital experience and he is preparing to steer HUL into serving the future consumer who is more digital friendly,” said Sachin Bobade, vice-president at brokerage firm Dolat Capital.
The consumer major also announced that it had named Arun Neelakantan its chief digital officer effective January 1.
Neelakantan, who the company said was brought in to unlock growth opportunities by leveraging India's digital ecosystem, will also join the company’s management committee.
Neelakantan is the first chief digital officer of the company who will be part of the company’s management committee.
Brand expert Devangshu Dutta, founder of business management consultant Third Eyesight, said that HUL was a traditional company but had never shied away from experimenting with different models of customer engagement.
"The profile of the younger Indian consumer is more digital friendly.
"This move won’t fundamentally shift the company’s business in the short term, but it is creating a connect with the younger consumer group which will be the mainstay for the future," said Dutta.
In the December 1 announcement, Jawa had said: "As we embark on our next phase of growth and transformation, we will combine our scale and discipline with innovation and agility to serve our consumers even better, and build a future-fit business," adding that beauty and personal care continued to be a source of value creation for the company.
While talking about the company’s acquisition of a majority stake in Zywie Ventures, which sells plant-based and clean-label consumer wellness brand Oziva, and a stake in Nutritionalab, which houses its products under the brand name Wellbeing Nutrition, Dutta said that the future trajectory was kept in mind while making these moves.
“These don’t add significantly to the topline and even bottomline.
"But it is a move by the company to connect with the newer consumer segments,” Dutta explained.
The maker of Dove soaps also appointed two separate executive directors for the beauty and wellbeing business and the personal care business.
Harman Dhillon will join the company management committee as executive director of the beauty & wellbeing business and Kartik Chandrasekhar will join the management committee as executive director of the personal care business. Both will assume their new roles from April 1.
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