Ignoring innovation is the biggest risk companies can take, warns Unilever
EXCLUSIVE: A failure to utilise innovation and take risks is "arguably the biggest risk a company can take" in the global transition to a low-carbon economy, the senior vice president of global marketing at Unilever has said.
Speaking exclusively to edie, Unilever’s Aline Santos claimed that the current green economy landscape, shaped by the recent signing of the Paris Agreement and the newly-agreed Sustainable Development Goals (SDG), has clarified which megatrends need to be accounted for by business.
According to Santos, who has worked across several arms of the consumer goods firm with brands such as Dove and Surf, there is now a need for companies to harness green innovation to drive sustainable change.
“This is the most critical time for innovation and its absolutely the time for innovation to start providing solutions,” Santos told edie. “Not innovating and not taking risks is arguably the biggest risk of all, and its why we have to start harnessing as much as we can from others.
“Innovation is something Unilever takes super seriously and we question ourselves thoroughly to ensure that the quality of innovation that we are bringing to the table is sufficient to aid the world in the changes that it is going through.”
Santos noted that major companies are aware of the current environmental issues that need tackling, such as air pollution, waste management and water scarcity, but that some firms still have some “arrogance” by thinking that they can tackle these issues alone.
Unilever is no stranger to working with other companies to strengthen its own corporate responsibility and its products. With sustainable business pioneer Paul Polman at the helm, the Dutch company has seen sustainability become a core business principle, which is evident amongst its sales. The company’s five largest brands – Knorr, Dove, Omo, Hellmann’s and Lipton – are all Sustainable Living brands and all grew 30% faster than the rest of the business in 2015.
But, while Unilever has also managed to save €600m through in-house eco-efficiency measures since 2008, the company is still looking to innovate the final products that its consumers interact with.
Unilever’s efforts to push innovation were displayed in 2014 when it launched the Unilever Foundry platform. The Foundry, which runs as a parallel to Unilever’s internal innovation researching efforts, provides aspiring start-ups and innovators with a much-needed touch point with established brands.
For Santos, the Foundry has been “extremely powerful” in pushing brands away from “beautiful narratives” that focus on stories to an action plan that highlights how new innovations can spark behaviour change amongst consumers.
The Foundry, which also has ties with crowdsourcing platform Indiegogo, recently unveiled the 48 new start-ups, including community waste prevention company Neighbourly, that would be matched to Unilever brands and scaled-up to provide innovative solutions.
Santos revealed that around £20m was being invested by the brands to bring initiatives ranging from farming information sharing to behaviour change pledges into the mainstream. While the volume of innovations isn’t going to “disrupt” Unilever’s business, Santos does believe that it will create wholesale changes among consumers.
“Innovation is a huge movement and it’s never been so important,” Santos said. “With all the knowledge that companies have on consumers, we understand we need to do more to change their behaviour.
“Innovation will help and consumer behaviour is a fundamental element of the change that we need. With so much experience in marketing, Unilever understands quite a bit about consumer behaviour and our intelligence is being put behind how to move consumers into a more sustainable living environment.”
One of the hallmarks of the new sustainable living environment that Unilever has been able to implement is a smart water meter from Israeli start-ups BwareIT. The meter on the taps turns red when too much water has been used, informing the consumer without the need for a message. Santos revealed that, by sharpening the Foundry brief over time, Unilever has been able to pull in more innovative solutions like that from BwareIT. Not only does it help tackle water use issues but it also reaches out to brand consumers to make a difference, Santos said.
With around 46% of Unilever’s growth arising from Sustainable Living brands, and more than two billion consumers using the products across the globe, Santos notes that consumers are slowly climbing on-board the sustainability bandwagon, but would need guidance from simple-to-implement innovations.
“Start-ups offer a means to change behaviour without suggesting anything to consumers, but just having gadgets and solutions available to them will change how they interact with trends such as water and waste," she added.
“The challenge for us is how these trends will impact how people interact with our products. How can Unilever bring benefits and solutions to consumers? You will see even more things happening in the Foundry which will really invite people to join this movement to not only help us but help society as well.”
Santos reiterated the recent call from actor-turned environmentalist Leonardo DiCaprio that this is the last generation that can 'stop' climate change. Fortunately, with Unilever figures revealing that 54% of its consumers want to buy more sustainable products, this generation could be about to act.
For Unilever and for Santos, it is “crystal clear” that low-carbon, resource-efficient innovation requires a whole-hearted and collaborative approach in order to ignite the necessary transformation.
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