LETTING GO
WORKING AT HOME IS TAKING A TOLL ON PERSONAL GROOMING PRODUCTS, UNILEVER FINDS.
It did not take long for standards to slip. Weeks into lockdown, the coronavirus pandemic is starting to lay waste to basic personal hygiene and grooming routines, according to consumer goods group Unilever.
As large numbers of people work from home, they are washing their hair less often, putting off shaving and even abandoning deodorant.
Graham Pitkethly, Unilever’s chief financial officer, said about a quarter of personal care — such as hair washing, hairstyling and use of skin care products and deodorants — related to people preparing to go to work or school. Homeworking was leading to a decline in demand for products including razors, shampoo and deodorant.
In results issued on Thursday, the Anglo- Dutch company said lockdowns had affected its hair care portfolio in China and India, while skin care sales were also down.
Unilever makes products including Dove soap, Lynx and Sure deodorants and Toni & Guy hair care and styling products, as well as Ben & Jerry’s ice cream.
Pitkethly expected changes in consumer behaviour to persist after lockdowns ended and said the business was adapting.
He said Unilever believed people were likely to spend “more time at home, more time cooking — which is good for us — and maybe less personal care occasions, this nesting idea”.
Unilever reported a boom in sales of household cleaning products such as Cif cleaners and Domestos bleach, both of which reported double- digit underlying sales growth in the first quarter.
Alan Jope, chief executive, added that while “people are shaving less,” a shift to online buying would favour digital brands such as Unilever- owned Dollar Shave Club.
“We are almost certainly going into a period of low economic growth and we’ll adjust to that by prioritizing the value- for- money products in our portfolio — we’re going to be dealing with that for a couple of years,” he said.
“Secondly there is no doubt people’s concern about ( household) hygiene has increased . . . and the shift to online digital consumption of media and online shopping is something that will be permanent. We will adjust our approach to reflect that.”
Unilever has been repurposing factories to make hand sanitizer in more than 30 locations around the world, including what had been a “massive” deodorant factory near Leeds; it has also rolled out Lifebuoy soap in 43 new markets.
On Wednesday the company reported flat underlying sales growth in the first quarter, down from 3.1 per cent a year earlier and below expectations, as lockdowns also cut into its food service business, which serves restaurants, and its €6 billion a year ice cream division.
The report sent shares in the company down 5 per cent to £40.28 in early trading on the London Stock Exchange.
The downbeat figures from Unilever contrasted with rivals such as Procter & Gamble, which last week reported its biggest quarterly US sales uplift in decades. Unilever’s turnover was up 0.2 per cent to £ 12.4 billion during the quarter, while the group will pay out its interim dividend as usual.
Pitkethly said the signs from China, which is reopening its economy, showed how social changes were persisting.
“About 70 per cent or so of restaurants that had closed in lockdown have opened up again, but those that are operating are running at lower cover capacity — somewhere between 50 and 70 per cent — because they are having to observe physical distancing protocols,” he said.