iVillage, Unilever Subsidiary to Launch Site in India
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Women's content site iVillage is partnering with a division of consumer packaged goods giant Unilever to roll out a regionalized site for Indian women, in the second partnership between the two companies.
According to terms of an exclusive licensing and technology deal announced today with Hindustan Lever Limited, the largest consumer products company in India, Silicon Alley-based iVillage will supply content and technology to the as-yet unnamed venture.
If it goes through, the deal is a win for iVillage, which gains an additional revenue stream and is able to expand its brand internationally with a modicum of expense. It's the second time Unilever and iVillage have agreed to work together; the two firms announced a joint venture in the United States last February designed to showcase Unilever's beauty products. The site, to be called Substance, has not yet launched.
"Our relationship with iVillage continues to add value," said Clive Butler, director for corporate development at Unilever. "Together we are learning how to reach and communicate with our consumers online and build relationships based on an understanding of their needs. For HLL, the partnership with iVillage.com is timely given the projected growth of online users in India."
HLL will contribute its market and brand management experience to support the site through online and offline activities targeted to Indian women. HLL will also build and operate the site, which will be run out of Bombay.
As part of the licensing agreement, HLL will pay an initial set-up fee for technology and consulting services, and iVillage will receive an annual royalty on any revenue generated. HLL will also provide all capital investments required in maintaining the Web site including technology, staffing and marketing support. The site is expected to launch in the second half of 2001.
The agreement is subject to regulatory approval in India.
The HLL agreement is also the second step in what iVillage said is its international rollout strategy. Last year, the company launched a U.K. version of its site in conjunction with Tesco PLC.
"This is another affirmation of Unilever's confidence in the iVillage brand and its effectiveness in reaching women online," said iVillage chief executive Doug McCormick. "HLL is present in nearly every urban household in India, and given HLL's strong equity among and deep understanding of Indian women, this agreement effectively leverages the iVillage brand and assets in India, where Internet usage is steadily on the rise."
HLL and Unilever aim to gain from cross-media marketing to the India's women. The companies estimate that nearly 40 percent of all Indian women will be online in five years.
"We are creating a powerful tool of connecting with them and providing them with their own space for meeting their diverse personal and professional needs," said HLL finance director D. Sundaram, who oversees the company's online efforts. "This is one of the initiatives in the company's long-term strategy ... with the aim of reaching out to millions of consumers and building strong and enduring relationships and best serving the needs of Indian women as they come online."