chain framework and generic strategy Research Paper 2022

E-business
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Executive Summary
The paper helped in evaluating and classifying the current e-business strategy used by Unilever.
It is seen that the company uses a B2C strategy by delivering products directly to its consumers.
The firm uses differentiation strategy as its generic strategy to gain a competitive advantage
within the market. With the help of the McKinsey 7S model, PESTEL and Porter’s five forces
analysis, it is seen that digital technology creates an impact on the company’s business strategy.
It has also been noticed that following disintermediation and reintermediation strategy creates an
impact on the company’s e-supply management, value chain framework and generic strategy by
improving its business activities.

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Table of Contents
1.0 Introduction.....................................................................................................................................3
1.1 Overview of Unilever........................................................................................................................3
2.0 Analysis of the impact of digital technology.........................................................................................4
3.0 Evaluation of the concept of disintermediation and reintermediation....................................................7
4.0 Recommendations and discussions......................................................................................................10
References.................................................................................................................................................12
Appendices................................................................................................................................................15

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1.0 Introduction
E-business strategy can be defined as a long-term plan to put digital technology in the right place
so that the company could manage its electronic communications with all the partners. The
fundamental objective of the report is to critically analysis the current e-business strategy of the
multinational company in order to evaluate the impact of digital technology on the business.
Moreover, Unilever is the multinational company selected for analyzing the e-business strategy.
The report will use different theories or frameworks for analyzing the impact of digital
technology on the business of Unilever. It will provide an overview of the firm based on the
online as well as offline activities. Besides this, the concepts of disintermediation along with
reintermediation within the industry in which the organization operates will be evaluated to
examine that existing players in the industry use new intermediaries for promoting their services
through advertising. Few recommendations will be provided to the multinational company to use
social media as well as social commerce for expanding the business and achieve the goals. E-
business assist the business in purchasing as well as selling products or services through internet
and accomplish business objectives.
1.1 Overview of Unilever
Unilever is considered as the oldest multinational company of the United Kingdom. It offers a
range of products to the customers, which include cleaning products, food products and beauty
along with personal care goods. It has earned a revenue of around €50.982 billion in 2018 and
contains more than 155,000 employees as of 2019. The company operates in the consumer goods
industry and serves customers throughout the world. It is identified that the business model of the
company is Business-to-consumer model, which assist the firm in selling its products directly to
the target customers. By using the B2C model, the corporation is not required to take help from
any wholesalers, intermediaries and third-party retailers. The purpose of Unilever is to make a
sustainable living to commonplace and offer a range of products to millions of consumers across
the globe. Based on the business-to-consumer model, the organization effectively develop a
value chain and build a personalized campaign to meet the client’s demands. Moreover, Unilever
is working in driving both B2B and B2C business models in order to attract more online
customers and develop its e-commerce chain (Mukiira, Musau and Munyao, 2017).

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With the use of generic strategy, Unilever has efficiently maintained a competitive advantage in
the consumer goods industry. It enables the firm to apply intensive growth strategies to match the
business requirements and thus, support business growth. It is identified that the broad
differentiation generic strategy is used by Unilever to achieve competitive advantage. This
strategy is aligned with the vision and mission statement of Unilever for increasing vitality
among client’s lives and support global sustainability. The objective of the differentiation
strategy is to focus on developing products in order to stand out from the competition as well as
attract large consumers (Ze et al., 2018). With the help of this generic strategy, Unilever
increases its revenue in various countries and obtain high development opportunities.
2.0 Analysis of the impact of digital technology
McKinsey 7S Framework
McKinsey 7S Model refers to the framework used by the organization to implement a new
strategy, facilitate change in the organization and review marketing capabilities from different
perspectives (Njeru and Kariuki, 2019). The model consists of seven elements which are
considered to analyze the impact of digital technology on Unilever’s e-business and e-marketing
strategy. The seven components of the model are as follows:
Strategy – The digital strategy of Unilever is to build a conversational relationship with
customers. The use of digital technology in the e-marketing strategy assist the marketing team in
engaging with clients and developing more efficient marketing to deliver quality products and
enhance social impact.
Structure – The organizational structure of Unilever supports global operations and manage
product types. The digital technology allows the company to adopt innovative solutions and get
close contact with the customers.
Systems – The organization use social platform for digitizing the operations of the business. It
implements a more digital platform for innovation and make the customers aware of a large
number of brands and obtain feedback to improve the quality of products or services as per
customer’s demands (Bismark et al., 2018).
Staff – While using digital technology in e-business strategy, the company required to employ
technically skilled staffs for smooth adoption of strategies and accomplish desired objectives.

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Adoption of digital technology helps in fostering collaboration among the staffs that aid them in
finding clients and information regarding their insights.
Skills – Unilever consists of millions of workforces to conduct different activities. It provides
various training on developing information technology skills of the personnel so that they could
effectively work on digital platforms and provide services to online customers.
Style – With the integration of e-business strategy, the company represents the positive social
impact of its products (Shaqrah, 2018). Digital technology, such as social media helps the firm in
developing a social platform to connect to online marketers and reach millions of customers
across the globe.
Shared values – It is analyzed that Unilever conducts its operations with integrity and honesty
along with openness that assists the firm in using e-commerce strategy for attracting consumers.
Availability of the number of technologies in the market creates a barrier in developing an e-
business strategy for building a strong relationship with customers.
Porter’s five forces model
Porter’s five forces analysis is used to evaluate the need for prioritizing competition in the
industry. It determines the impact of external factors in the environment of the firm. The five
forces of the framework are as follows:
Competitive rivalry: It is identified that a number of firms are operating in the consumer goods
industry, which imposes a high threat to Unilever (Stindt et al., 2017). The top competitors of
Unilever are Nestle, Johnson & Johnson and Colgate Palmolive. The rival companies use an
innovative digital technologies to reach to millions of consumers which cause strong competition
to Unilever.
Bargaining power of customers: Low switching costs of Unilever allows the customers to shift
to other company’s products and thus, contribute to the high threat of the power of purchasers
(Takata, 2016). The clients can access to a high quality of information through digital technology
which makes it easy for them to choose products of the company. This force affects the business
of Unilever, and thus, it requires to enhance the use of digital technology for marketing products.

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Negotiating power of suppliers: It is the external factor that moderately affects the consumer
goods business of the organization. Size of suppliers of Unilever is moderate, which cause a
limited change in the availability of materials used for increasing awareness of products over the
internet.
The threat of substitutes: The alternative products can reduce the revenue of the company in
the industry, but the threat of substitutes is low because the products of Unilever are highly
attractive as compared to substitute products.
The threat of new entrants: It is low for the organization because it is difficult for the new
company to enter the market and give competition. There are no switching costs for the new
entrants, and the market is based on digital technologies. High investment is required in the
digital platform for entering into the market.
PESTLE Analysis
Pestle analysis is another framework considered to understand the market dynamics of Unilever
and the impact of external factors on consumer goods business.
Political factors: Unilever contain huge product portfolio and thus, for marketing products in the
digital platform, the company need to abide by the government regulations (Rastogi and Trivedi,
2016). The political laws related to the use of information and technology services might impact
the business. Besides this, the company should comply with consumer protection laws for
protecting information via digital technologies.
Economic factors: The slowdown of the economy of developing countries like China could
impact the business of Unilever. The company focused on the needs of the product and
maintained stability in using digital technology to reach to customers.
Social factors: It is considered that millions of people in the contemporary era prefer online
shopping and use social media sites. The use of digital technology in marketing and selling
products via the internet and social media platform could positively impact the business.
Technological factors: Research and development in the industry of consumer goods provide an
opportunity for the company in the management system. Increased use of digital automation
technologies provides an opportunity to expand the business in other parts of the world. Use of

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the internet for marketing is an important technological factor that positively influences the
business of Unilever.
Legal factors: Different regulations such as health and safety laws and information technology
laws are appeared as an opportunity for the company to bind with the laws and overcome the
legal issues. These external factors allow the company to develop an organized digital business
environment for operating the business.
Environmental factors: Climate change is a significant external factor that may create
constraint or opportunity for the company (Perdana, 2016). Through a digital platform, it could
sell its products to a number of customers, and thus, environmental factors could not impact the
business. It assists in enhancing sustainability growth of the business.
3.0 Evaluation of the concept of disintermediation and reintermediation
Disintermediation includes the elimination of intermediaries like brokers or distributors that
formerly associated a firm to its consumers. While reintermediation includes the development of
new intermediaries among suppliers and consumers by facilitating services like product
evaluation and supplier search (Zamani and Giaglis, 2018). Both disintermediation and
reintermediation are determined to be a huge development within e-commerce.
Within consumer goods industry, most of the producers make efficient use of marketing
intermediaries to operate a collection of essential functions to deliver the product to the final
customer rather than selling services or products directly to customers. These intermediaries
involve financial intermediaries, distributors and intermediaries like brokers, agents, retailers and
wholesalers to gain long-term success. Most of the companies within the industry use vertical
integration business strategy by controlling the direct supply or distribution of the company’s
products. By obtaining the buyer or supplier, executives can eliminate or minimize the influence
that the buyer or supplier has over the organizations (Benghozi and Paris, 2016). It helps
organizations to generate huge potential for profitability. For example, organizations use a
vertical integration strategy as a new intermediary by opening stores or through acquisitions or
merger like eBay purchased PayPal. It helps companies to promote their products through
advertising. On the other hand, virtual integration is regarded as a new form of value chain
management where the links of the value chain are combined through informal arrangements of

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consumers and suppliers. The organizations within the consumer goods industry use virtual
integration to arrange their requirements through networked computer system or internet. It helps
in serving consumers in ordering any other needs, services or order. Existing players use this
integration by categorizing culturally different value-added relationship among suppliers and
manufacturers.
Porter’s value chain of Unilever determines the way how disintermediation and reintermediation
strategy that creates an impact on the company’s e-commerce strategy.
Inbound logistics
The waste is determined to be the loss of production time in the arrival of low-quality raw
material. The disintermediation and reintermediation strategy creates an impact on incoming
logistics that has to be verified before delaying the time schedules (Wang, Han and Beynon-
Davies, 2019).
Production and operation
The strategy creates an impact on business activities by paying and sending back the workers and
the manager engages with the maintenance team to know the situation and inform the production
procedure with the production manager.
Outbound logistics
Through this strategy, the company is able to improve its customer service, reduce CO2
emission, deliver products on time and manage the inventory (Soltanizadeh et al., 2016).
Marketing and sales
By following this strategy, the firm is able to understand and capture the needs of consumers,
compare cost-benefit, improve the approaches to advertise and promote the products.
Service
The disintermediation and reintermediation strategy creates an impact on the firm by solving
critical problems, conducting consumer survey and improve the quality of services as well as
providing immediate response to the needs of consumers (Graham, Hjorth and Lehdonvirta,
2017).

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Procurement
With the help of the strategy, the organization is able to optimize quality and minimize the cost
of raw materials. It can also procure machinery and maintain good and positive relations with
suppliers.
Technology Development
It helps the company in adopting new technologies, scanning product lifecycle and have positive
collaboration with the research and development department.
Human Resource Management
The disintermediation and reintermediation strategy supports the organization in motivating
workers through extrinsic and intrinsic rewards, enhancing labor skills, appreciating the efforts
pf the workers and maintaining good relations with trade unions (Ertek et al., 2017).
Firm Infrastructure
It enhances a firm’s infrastructure by handling legal affairs and breaches and monitoring the
quality of products and services.
The disintermediation and reintermediation strategy creates an impact on e-supply chain
management of Unilever with the evolution of new technologies. The internet creates an
influence on the company by changing the process of the transaction. They affect the
intermediaries within the supply chain of the company (Zamani and Giaglis, 2018).
Disintermediation helps the company in removing the intermediaries of a supply chain while
intermediaries include new components into the supply chain. Based on the disintermediation
process, the firm is able to meet the needs of consumers through different distribution channels
by impacting consumer perceptions. With this, the company implements the strategy of selling
its products directly to consumers through the internet. Thus, the firm charge fees for their
services by increasing the scope of their services. Moreover, it is significant for the firm to
understand the implications of the strategy and implement the business procedures to fulfil
consumer needs (Oskam and Zandberg, 2016). Therefore, a huge amount of business to business
data exchange through the internet has been implemented within the firm as a reintermediation

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service that enables the value-added network to facilitate an efficient and effective service to the
end-user.
It is seen that Unilever makes efficient use of differentiation strategy as its generic strategy for
gaining competitive advantage. However, following disintermediation and reintermediation
strategy creates an impact on its differentiation strategy by focusing on creating unique products
as compared to its competitors (Cetin et al., 216). Through different intermediaries, the company
is able to grow its e-commerce business through rigorous efforts in product development.
Different intermediaries help in providing various opportunities for the firm to increase its
revenues. As a result, the strategy helps in enhancing the financial performance of the e-
commerce business (Singh et al., 2019). Thus, it makes Unilever’s products competitive and
attractive as compared to its competitors by grabbing the attention of consumers to specially
designed products and services.
4.0 Recommendations and discussions
It is highly recommended that Unilever must use social media strategy for increasing its
customer support, lead generation, involvement along with brand awareness. It will help the
company to have understood the brand presence and meet the online world. It will also help in
providing data to help in analyzing online presence more systematically. Moreover, with the help
of different social media platforms, the firm will be able to drive traffic towards their website by
distributing content regarding its products and services. Meanwhile, it must create a new lead
with enterprise software firms to warm up potential consumers by using Google Analytics
reports. With the utilization of social commerce, the organization will be able to make a more
targeted and personalized in-app experience shopping experience for consumers. For example,
the company must use different social commerce sites and social commerce platforms such as
buy buttons on Pinterest and Twitter or Facebook business retail store pages. It may result in
increasing website traffic, customer involvement and sales towards driving traffic. Social
commerce helps in motivating individuals to connect with a particular business in the form of
two-way communication. This will allow customers to engage with the business and provide
them with the opportunity to utilize social media as an accurate consumer service channel.
It is also recommended that the company must use the customer life-cycle marketing framework
to build a relationship with its consumers through integrated communications throughout

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different digital channels. It will help in increasing consumer involvement by developing a new
phrase within digital marketing. With this, the organization may use traditional channels such as
phone contact or direct mail. Moreover, the company must use B2B integrated marketing
strategy through LinkedIn, Google AdWords and email. Furthermore, it will help in improving
the integration of communications for awareness, sales channel, follow-up remarketing
communications and decision content. The framework provides various benefits like
understanding consumer needs, identifying high-value and long-term consumers by marketing
the messages effectively.
It is strongly recommended that the company must use RACE marketing value framework to
manage organizational activities systematically by implementing a well-informed digital
marketing strategy. With this, the company will be able to simplify its reporting and
measurement. The implementation of this framework will help the company to reach its
customers through blogs, publishers, social networks and search engines. Furthermore, it will
help in taking actions through interactive tools, community, blog and website. It will also support
in converting e-commerce process by focusing towards product, promotion and price. Similarly,
the framework will be helpful for the firm in engaging consumers through customer advocacy.
Therefore, the plan will help in improving online marketing activities by developing a digital
strategy.

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Appendices
Figure: Unilever e-commerce strategy
(Sources: Bogers, Hadar and Bilberg, 2016)
Figure: Unilever E-business Model
(Source: Cao et al., 2019)

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Figure: Unilever Revenue
(Source: Waghmare and Golhar, 2017)
Figure: Value chain analysis of Unilever
(Source: Brian Lee and Li, 2018)

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Figure: Unilever brand differentiation
(Source: Viljoen and Roberts-Lombard, 2016)