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May, 23 2018

Hindustan Unilever Calls Nielsen Data Inappropriate

The local unit of the Anglo-Dutch company, for long considered a good proxy to gauge consumer sentiment across the country’s socio-economic spectrum.

Country’s biggest consumer goods firm, Hindustan Unilever Limited has alleged market research firm Nielsen as incorrect indicator in terms of growth and market shares.

"If you look at Nielsen, it is saying in the last three months or last twelve weeks, the demand has gone down. We don't believe those numbers for the simple reason that there are base issues and we firmly believe that Nielsen operates much better when there is relatively stability in the market," HUL's MD Sanjiv Mehta said at an investors call.

The local unit of the Anglo-Dutch company, for long considered a good proxy to gauge consumer sentiment across the country’s socio-economic spectrum, said of its several categories have been growing shares consistently much before Nielsen picked up the trend.

For instance, in the tea category, HUL said it have done exceedingly well for the last several years which reflects in the published results as well. Ditto in the case of home care which the company said has the highest market share it has seen in living memory "It was very visible that we had taken leadership (in tea) as far as the values are concerned, but it took Nielsen a couple of years to reflect it in the shares," added Mehta.

The maker of Rin detergent and Lux soap, however, maintained that in a country as large and varied as India with nearly nine million outlets, Nielsen cannot be taken it as a perfect science and has to be used more as a trend rather than an absolute number. The November 2016 de-monetization and the 2017 rollout of the single producer levy had impacted Nielsen's data, the company added.

For several companies, Nielsen data is crucial especially when the market shares numbers play a role in determining manager’s compensation packages at times. Market analysts also depend on Nielsen data to track consumer product companies’ performances.

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