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(Reuters) – Unilever’s beauty and personal care unit only closes on one-tenth of the M&A deals it looks at, the unit’s boss said on Wednesday, illustrating how many upstart brands have flooded the market vying for attention.
Alan Jope, Unilever’s president of beauty and personal care, told a conference hosted by Barclays that he has approved over 130 “licenses to hunt,” which have resulted in just 13 acquisitions over the past four years, including Dollar Shave Club, Murad and Hourglass.
“We’re on a ten-to-one ratio of frogs we have to kiss to find the occasional prince or princess,” Jope said.
Overall, Unilever has completed 24 acquisitions since the start of 2015 as it seeks an accelerated overhaul of its portfolio.
Its 21 billion euro beauty and personal care business also launched seven new home-grown brands over the last 18 months, including Love Beauty and Planet, which is on track to reach $60 million in sales and turn a profit in its first year.
The unit also has over a dozen more ready to go, Jope said.
“We completely changed how we do market research,” he added, noting that brands are now engaging directly with consumers in the early stages of development, rather than developing products and testing them later.
This was also the case with a new laundry care spray Unilever launched last week.
When it comes to marketing, Jope said new brands make more of a showing in stores and on social media, rather than relying on big-budget television ads, which are emblematic of a 120-year-old model of mass marketing that Jope said is “entering its twilight years”.
After a slow first half hurt by a truckers’ strike in Brazil and low pricing growth, Jope said his unit is expected to return to growth in second half of the year.
Written By Martinne Geller; Editing by Kirsten Donovan For Reuters