Using AI to optimise our portfolio and fuel growth

Using cutting-edge, data-driven technology, we can optimise our on-shelf presence, both in physical stores and digital commerce, ensuring that we provide our consumers with the products they want, in the formats they want, through the channels they use – as efficiently and effectively as possible.

Optimising our wide-ranging portfolio of brands and products involves a process called SKU (stock-keeping unit) simplification. This is how we determine whether a particular item should be kept on the shelf or discontinued.

Delisting low-performing products allows us to make room for growth: to focus more on our core SKUs, develop new products in response to changing consumer needs and create tailored plans for our customers.

To do this, we’re using a new data-driven tool that gives us a holistic and granular assessment of our portfolio through advanced analytics and insights. It brings together the best of machine and human intelligence to allow us to make faster better-informed decisions.

How it works

The tool crunches the data and makes a delist recommendation based on the benefit to our customers (retail partners), our consumers (by looking at what shoppers are actually buying) and Unilever (is it driving profitable growth?).

This three-lens approach is a sophisticated way to assess and manage our portfolio, recommending which SKUs to delist, watch, protect or grow.

Our in-market teams are able to understand their top performers and – where there are opportunities – to invest more with SKUs that may be in the middle of the pack. The approach improves their focus on where they need to direct action. It also allows them to track their overall portfolio performance.

While the system is a highly advanced data-driven platform, it stills needs a human touch. The final decision sits with the in-market teams. And there are reasons why they may decide to keep a low-ranking SKU. As one example, a SKU may be a recent launch and is just now getting established.

There are big gains to be made in time, cost and capacity at every stage of the delist process, from the moment we stop production and start liquidating inventory (less warehousing, waste and transport) through to resetting our capacity (improving our productivity and freeing up space).

A big step towards true data intelligence

The approach leverages the vast amount of data available to us, to give an accurate, insightful and actionable view of our portfolio. It segments the data by category, customer, brand and channel and also provides a total market and cross-market picture of delisting opportunities.

We’ve rolled the tool out in Canada, the US, Europe, Africa and Latin America. Our plan is for the platform to be live across all our operations by the end of the second quarter this year.

“The capability brings together the perspectives of our customers, shoppers and business to make better, faster decisions that create growth for our business and for our customers,” explains Morgan Vawter, Unilever’s Global VP, Data Centre of Excellence. “This is supported by clear targets from our leadership and by robust end-to-end governance. The tool gives us visibility of each SKU delisting execution, so we have full traceability of every step to realising its value.”

“The opportunities to save cash and deliver fuel for growth are huge, and we’re already seeing the results,” adds Steve McCrystal, Chief Enterprise Technology Officer, “This is a big step on our journey to becoming a truly data-intelligent organisation, where every decision and action is powered by the best data and advanced analytics to deliver our future-fit Compass strategy.”