Hindustan Unilever: The Success Machine That Fails to Build and Sustain New Categories

Just came across a news article that Hindustan Unilever Limited (HUL) is spinning off its ice cream business, potentially setting the stage for a complete exit. Quite surprising? Maybe. But in reality, it aligns with HUL’s long history of throwing in the towel early in highly competitive categories while branding these moves as “strategic decisions.” The company, an aspiration for professionals and revered as a?“CEO Machine, " has repeatedly struggled to sustain and build new categories, often choosing divestment over innovation.

A History of Exits: When the Giant Opted Out Instead of Fighting

For the last four decades, HUL has exited, sold JVs, or diluted its stake in multiple businesses that had enormous potential. Here’s a look at some of the most notable ones:

• Sharp Edge Ergonomix Blades (sharp edge) – Sold to #Gillette, missing out on the men’s grooming boom.
• #Dalda Vanaspati – Once a leader, sold to #Bunge India, while edible oils became a multibillion-dollar market Example saffola from Marico.
• Annapurna Atta – Sold off, while ITC built a $2 billion business in the flour market.
• Captain Cook Salt – Couldn’t compete with Tata Consumer, despite being an early mover.And was sold.
• Ayush (Ayurvedic Brand) – Created for India but eventually faded away due to lack of long-term vision. Look at Patanjali created? $2 billion brand
• Modern Bread & TOMCO (OK / HAMAM) – Iconic brands that lost their sheen post-acquisition. Died prematurely.
• Axe Deodorant – Once a market leader, now overtaken by Fogg, leading to its slow withdrawal.
• Pure it Water Purifiers – Sold to Eureka Forbes, giving up a growing segment.
• Stayfree & Carefree – Couldn’t sustain in female hygiene, sold to Johnson & Johnson. And never fought #Pantene
• Chloro-mint (Confectionery Category) – Sold to Perfetti La Mela.
• Nihar Hair Oil – A promising category, sold to Marico.
• Rozana Rice Brand – A lost opportunity, sold to LT Foods.
• Knorr Noodles – An attempt at disrupting instant noodles that never took off.
• Maxo Mosquito Repellent JV – Exited despite a booming market.
• Kimberly Clark JV – Another global partnership abandoned.
• Lipton-Pepsi JV – A missed opportunity in the ready-to-drink tea segment.

What Next? Likely Future Exits

Given HUL’s past trends, it wouldn’t be surprising if they exit Oral Care (Pepsodent & Closeup) and Jams (Kissan) in the near future. These are competitive markets, and if HUL continues prioritizing short-term financial performance over long-term category building, these brands might follow the same fate.

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Why Does This Keep Happening?

• Frequent Changes in Category Directors – Every 3-5 years, a new leader steps in with a different strategy, leading to inconsistency.
• Short-Term Profit Pressures – Quarterly revenue & profit goals push HUL to abandon slow-growing businesses instead of nurturing them.
• Global Parent’s Influence – HUL’s parent company prioritizes dividends & brand fees, leaving little room for long-term category investment.

Final Thoughts

For a company known as India’s biggest marketing powerhouse and the ultimate CEO factory, HUL’s legacy of exiting rather than winning in categories is disappointing. Instead of pulling the plug, HUL should double down on innovation, product differentiation, and market positioning. Otherwise, history will repeat itself, and we will see more iconic brands disappear from its portfolio.

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