Good morning and afternoon. I'd like to welcome you to the 3rd in our series of deep dives where we invite investors to learn about a specific area of our business. The first webinar was in March talking about our business in the U. S. And in June, we talked about innovation with our Chief R and D Officer.
Us. Both are available to replay on the website. Today, I'd like to introduce Rohit Jawa, who is the EVP of Unilever China us and is going to talk about one of Unilever's most exciting businesses. And with that, let me hand over to you, Rohit.
It. Thank you, Richard, and welcome to all the participants for this presentation of the investors. Let me first start with a short introduction. I've been fortunate to work for Unilever across most of Asia, South Asia, almost all markets in Southeast Asia. And now for the last four and a half years and over, I've been in North Asia, which is really the most exciting market, and I enjoy being here learning every day.
Today, we will spend the next half an hour or so and then some type of questions to take you through the story of China and how Unilever has grown and really, really great business and with a lot of headspace for growth in the future years to come as well. Before I start, I'd like to draw your attention to the disclaimer to forward looking statements and non GAAP measures. Thank you. Let me first, at the very outset, start with giving you a set of headlines on what I'd like to communicate in the next 20 odd minutes or so. The key message I'd like for you to take out from the session is that winning in China is absolutely critical priority in Unilever.
We are already the 3rd biggest business in Unilever with a strong SPAs in non refilled growth. We have delivered consistent and profitable growth in the last 5 years. And through the pandemic we are coming stronger, more competitive, more agile and more digital. And we expect to continue to grow competitively following our consistent growth priorities, which are get our big brands into more households every month, every year transform our portfolio into a premium future portfolio and follow the shopper, which is basically go where people go. That in terms of growth in China is digital and in the lower tier studies, which we call Go Deep.
Let me give you a sense of how I would like to tell the story today. I'll stock of Unilever China in 3 broad segments. 1st, a bit of context in the consumer just to get us grounded on who we are serving. Us, take a closer look on our business in China and what we've built over the last three and a half decades that we've been in China and then took a double click on growth priorities and give you a sense of how you're landing them in the market, and then I'll close with Asampak. It.
Let's first start with the first segment, which is on the consumers. Let me first start by a The story of China's economy, which I'm sure all of you are familiar with, it's really been the most exciting economic miracle of the last Century, it's also been the most exciting consumer story. Already, China is the 2nd largest economy and most likely will be the largest economy in the years to come. It. It has really been a market which is now in terms of size, is parallel to all the big markets such as U.
S. And Japan. But importantly, the per capita consumption in our categories at least is still quite low compared to the reference markets of U. S. And Japan.
So we expect many, many more years of growth through operation, through market development, and that's the role we've got to play is to ride the growth That comes from the growth of middle class in China, which with the whole focus on common prosperity really means that consumption will become the main driver of growth in China. We want to our more than fair share of past in that story in the future. Going forward, let me just talk a little bit first about Huvia server. Now China is a very complex and a vast market, 1,400,000,000 consumers and really it's not possible to generalized. But for the sake of anchoring our discussion, I'd like to simplify the Chinese consumers to how we see that in really two kinds of broad meta segments for the sake of really starting the right place.
On one end, you've got the top 30 cities that are what we call high speed China. These are cities that are really very developed. These are cities where there's a lot of fragmentation, pressure to compete. Consumers are looking for experiences, they are looking for change, they follow a trend and upgradation really is the primary growth hypothesis. This.
This is indeed a very, very competitive market with lots of players all very excited and a very, very hot market, very much by strong e commerce and on the big stores. Whereas on the other side, we have enormous feed China. This is the China that exists in the low tier cities in the tier 3, 4, 5, 6, the towns, there are 2,000 odd cities below the big cities And 40,000 odd towns in rural areas that are really what we call normalcy China. This is a place where unlike the cash rich time poor our revenue and off the big series. Consumers do have time.
They have more leisure. They are more family orientated, more community orientated, And value for money is very, very important. They do have aspirations to grow, but there is and they're discovering e commerce. There's a lot more growth here In terms of penetration of Internet, penetration of e commerce, and in a sense, offline stores and the traditional channels like mom and pop and grocery is still a very, very important part. And these 2 China speed China's really require 2 different kind of marketing model.
On one end, very digital, very fast, very innovation oriented and on the other end, a lot more consistency, mental availability, physical availability, memory structures, sort of trying to get into more outlets, more stores and more households all the time. And these are 2 different jobs to be done that we must be mindful of as we try and compete and build the bigger business in China. Going forwards, I'd also like to touch upon a little bit about the trends. And clearly through the COVID, some trends have remained consistent and strong and will remain secularly there in China, and some new trends have become stronger and become more consolidated. First of all, I'd like to Shubhrant again the Lautier Cities.
70 odd percent of population is in the Lautier Cities and close to almost in our categories half of the offline market and a quarter of the online market is in this segment. This. This is growing faster before COVID and after COVID than the big series, up to 15% to 20% on the average, very broadly speaking. So we've got to partake in this exciting segment and build the brand there. And digitization of everything continues to be a megatrend that has only accelerated with the COVID in 2020 and is continuing to grow in 2021.
And consumers in China consume everything on the mobile phone, whether it's media, the entire life, shopping, the entire life revolves around the mobile phone. And it's only getting deeper and bigger and wider. Please note that still only 70% of China has got Internet penetration. So there's a lot more, a few 100 more 1000000 people who will be coming on. So it's not that this is the end Of the digitalization story in China, it's going to keep getting stronger and bigger.
And our prediction continues to be very, very important growth hypotheses. There's a 400,000,000 strong middle class, the upper class, the mass affluent. These consumers want a better quality of life. And as the focus of the government goes more and more towards consumption as a driver of growth and growing the middle class. The markets that we operate in will keep getting bigger And the opportunity is quite immense, certainly for our brands that partake with the average middle class consumer in China.
In addition to these secular trends, we also see some other trends becoming stronger. One is, of course, with the whole sensitivity towards hygiene With the COVID and the COVID not having gone away in the student's first, the focus on hygiene and we see the categories like disinfectant sanitizer, etcetera, still growing average of 30% CAGR if you take some up and down within the 2 years. And this will remain a very, very important segment to play in. It. There's also while consumers have gone back to living their normal lives after being cocooned for a short period of time, But the lure of the home, a third of consumer time is currently being spent at home and it's driving consumption like for food, like ice cream at home.
It's driving things like in home exercises, in home education, in home shopping. So the role of home in people's lives has increased and it's going to stay it. I entirely go back to completely old way. And finally, health, which is always very high on the values of the Chinese consumers, is becoming even stronger. And people want to consume products or do things that give them protection, give them well-being whether it's mental or physical, and therefore playing a part in the emotional and the physical well-being of our consumers will be an important space to play in as well.
Going forwards, I'd like to touch upon now really what has Unilever built in this exciting market that I've just painted the picture of. Let's start with Unilever in China. And I want to first start with really our belief and our mission. We know that this is a really exciting market for global and local players alike. That's not a secret.
But to win in China, we've got to really be a company that's locally tuned in, extremely agile, extremely fast, very digital, but leverages the Unilever's best of technology, brands and standards. It. We want to bring these two things together and become the best global company with amazing global leverage in China. We feel visibility can be done in 4 ways. 1 is a design for China, which is 100% of our formulations are designed or adapted in China.
We have a big army center that speak a lot about that as we go forward. Decision making in China, very important to be close to the consumer, decide because we need really people to understand the front end in China. It cannot be done 2 miles away. So most of our key decision makers are based and will be progressively based in China. And moving at the China speed, I mentioned the motion of speed, but it's really important, especially in the big cities, you've got to move really fast and bring things in, try them out and really either pivot, scale or kill, but keep moving and experimenting.
Now 75% of our innovations we have the capability of launching within 6 months of the project being kicked off in the market. And this is the muscle that we want to keep building on. And finally, being digital in China. I mean, it's no secret that you've the company. And you've got to be fully digital.
80% of our investments in media and marketing are digital, and already 40% of our business digital commerce space. We call this China for China, and that's really been a strategy that has paved with us as I will show you in the next chart. Go to the next chart. This shows you our track record in the last decade. Over the last decade, we have more than doubled our business.
And over the last 5 years, we have accelerated our growth and significantly stepped up our profitability by actually trying to be a channel for channel company with the best global leverage. We're already something like €3,500,000,000 scale, and we and we expect this will continue to become higher and higher as we have much more runway for growth in this exciting market. Through the COVID time, in the next half, I'd like to talk about how we've not just taken this growth track we've got for granted, but also when we faced the COVID crisis, we decided we're not it. We will first, of course, priority will be on our people, but we also will use this opportunity to become a stronger company, a more agile company, a more digital company, a more dynamic company and a better one team. And I feel we have all come through stronger in this period.
As you can see by looking at the market shares on some of our big categories, our competitiveness has increased across both online and offline. We've sort of bottled this dynamism of resource allocation, better agility in our innovations and a stronger our ability to basically get to the market at much high speed and basically also trying new things and scaling them quite fast. And we want to keep this capability bottled and one of the genetic makeups of the company going forward. Us. And we feel that this competitiveness is very important strength that we found and discovered in the spirit.
And over the last 2 years in 2020 2021, We continue to have business winning share of share, which is well above the 60% mark in China. Going forwards, I'd like to talk about a little bit about really our brand portfolio. We're blessed with an amazing brand portfolio. Not only are we diversified across all our broad businesses, foods and refreshment using personal care and home care. Amongst our 20 main brands today, or 65% of the business that we play, we are number 3 and the top 1, 2 or 3 brands.
Of the 20 odd brands that we are marketing in China, 10 of them, they're exceed RMB 1,000,000,000 or seen by in size. Anything that's about RMB 1,000,000,000 or Chinese New Island size broadly means it's a big brand in China. Half of these 10 brands actually Closer to well above the RMB 2,000,000,000 market. We feel this is a very powerful portfolio that we need to stretch. And we're also very fortunate that we've been able to over the last three and a half We have built a strong franchise as 80% of the open households are reached now by 1 or more Unilever brands, and that gives us an immense reach.
We are in fact amongst the top 5 largest CPC reach companies, global and local players alike in China. And that's a really strong position to build the next stage of our growth journey Gong. Not just that, when it comes to our capability in the next chart, I'd like to talk about what we have built in terms of what we are capable of doing. We have now built a very strong scale of manufacturing. We have manufacturing hubs, North, East, South and West.
In fact, our South hub It's being announced almost as we speak. We'll be making well over $100,000,000 investment in Guangzhou and in Guangdong province, And this is going to be our 4th big site. We already have one of the leading smart logistics campuses in Hefei. Our South Campus, our South Hub will be carbon neutral. That's our plan.
And 2 of our factories that we're very proud to say are already amongst the World Economic Forum's Lighthouse factories. These are factories that are amongst the very few in the world that have shown that they are digitally advanced and capable of delivering a growth while improving sustainability in the sort of context of 4th Industrial Revolution. Not just the manufacturing side of it, but on the distribution side of it, We are well networked. We have 26 logistic centers, ambient and cold. We have also been able to deepen our network in China And a consequence of which is that not only have doubled our presence in especially smaller cities, we are now seeing the benefits of that with most of our categories going share in the Lotteo sales.
We've also were prescient in that in 2009, we've built a global R and D center in Shanghai, which is in fact co located with the company. It's something I'm really proud of. We have 350 of scientists and professionals in the Army Center. Their focus on China and the Chinese consumer and Chinese technology and leveraging the global best and exporting some of the patents. We have well over 100 payers that originated from this excellent facility that we leverage.
In the last 3, 4 years, we have not just taken all of these benefits for granted. We've also built a strong robust digital infrastructure. Today, we have close to almost 100 digital specialists. These are people who have skill sets that are quite specialized like machine learning and business intelligence and so what have you. We also have ability to do analytics both for consumer and the business CyberVic and build tools, some that are proprietary in nature that actually give us competitive advantage.
And very importantly, in the present day and age with data privacy and cybersecurity have based on 1 data governance and being very, very much aligned to the regulatory context of China. It. We're using this entire capability that's in house along with our dedicated partners like WPP Unite. That's a dedicated Unilever platform that helps us by WPP that helps us deliver upper to lower funnel interview with communication, optimization of our marketing plans. Us.
And this is really, really super force to be with. And not only that, we've also built now a scaling in house partnership with U Studios, Which is basically in our content studio that not only gives us the ability to create content very, very quickly, different types of content. As in China, we have very large various various platforms, but importantly also use technology to really scale content sometimes across a lot of our platforms. We are, at the end, driven by quality of our people. In the next chart, I'd like to talk about really what's The soul of the company beyond all of the hardware that we've built is really our people.
We think we are a Chinese company. Most of our people, so 99% are local. Our view of gender balanced between men and women. We also have in our top team, large majority of our leaders that run various parts of our business our Chinese ethnicity. And that gives them the ability to sell, be very close to the market and basically do what's right for the consumer in the market.
Us. We've also been very proud that for the last 4 years, we've been the 1 employer of choice for the undergraduate. That gives us a really good crop of the entry level graduates. And in fact, Many of the leadership team started off as management trainees in Unilever China, and that's paying off now. We're also progressively building agile organization, an organization that's balanced its focus and scale.
To simplify, we call it the Grow Power and Make. We have essentially created a platform of making, which is manufacturing and sourcing, standardized operations, we're building that, order to cash, run digitally, And a set of centers of expertise capability hubs like digital analytics, like customer operations and regulatory affairs, etcetera, that service the business units, channels and customer. These business units are dedicated to the channels and the categories and the customers and leverage basically the scale of the Unilever platform by being really focused on winning in the markets that you choose to play in. Us. And given that we are in a wide range of categories, it's very important that the people who do the front end really live and breathe the category that they're running, while leveraging the best of scale economies and investments of Unilever's capability in China.
It. So that really brings me to the next chapter, which is very our growth priorities. These are growth priorities that Probably some of you may have seen in a few years ago and I spoke about China as well in a similar forum. I have remained consistent. Us.
These are really 3 growing our core brands penetration, which is getting into more households. These ten brands are most of our sales, 70%, 80%. And if we can get them to more hustles that drives the base of the business. Transforming our portfolio, very important in China to be constantly evolving our portfolio And that really means 2 things, more premium or being in really driven segments. And finally, going where people go, which in our case means going digital Because digital commerce is really growing very fast and growing deep and low tier where we have certainly a lot of headspace and wide space of growth.
It. And we see 3 key enablers, and I will touch upon them here and then at the end, is digitization because no company can succeed in China unless it's Digitize. And we're progressively digitizing, making investments, some that we've already made, many that we'll make in the future as well, to transform the entire company in a digital capable manner which is appropriate for China and still leverages the best we can use scale. Productivity, very important because we spend a lot of money in China on brand marketing investment, and we've been able to get continuous improvement in our productivity and use that to fuel our new growth ideas and also our growth and improve the shape of our portfolio. And finally, a giant organization that I touched upon are becoming really, really fast and flexible and supple when it comes to China to compete.
Let me now spend a little bit of time double clicking on each of these to give you a flavor of how we landed that in China. Let's talk about the core brands, the 10 brands that we feel really have the base of our business covered. We see, first of all, success in what we've done, Which is that 85% of our business is actually growing penetration this year on an M and A base, which means that we are getting into more hostels as we speak. It's very, really important because volume is one of the main drivers of growth and volume comes from more users and more usership. This is the primary growth hypothesis of any FMCG company, Especially in China and certainly for us.
We see 3 key drivers of growth in our core brands. 1 is to have the strong brand power. You want consumers to poll and that comes with meaningfulness, differentiation and tailings. And we are seeing when we have leveraged the brand's purpose Successfully, the consumers have pulled our brands that they've been they've been popular before, but pulled in even more. And a great example is what we are doing With Clear, which is one of our big hair brands, with the purpose of resilience.
Be Clear, we feel, is that's really helping a lot in terms of creating a memory structure and mental culture. It. 2nd is stretching our big brands across 2 adjacencies, because once we have brand name resonance and recall, it. It's quite possible to stretch the brands as Dove is showing with going into bath and body and skincare. And finally, we're executing with discipline, which is really about landing mental and physical availability and competitive products at all times in the market.
A great example in What we're doing with our Kunal Food Solutions business, which is despite COVID, has used digital selling as a means of getting to 3 times more operators and chefs And in fact, we've proved even their top chef population 3 by 3 times by this by digitization. It. A brand that really brings all of this together, these three forces, really are OMO, which is our biggest brand. OMO is already in the 3rd household. It's a really big brand in China.
It. And over the last 4 years, 5 years, we've seen or more growing in market share by more than 100 basis points in a very competitive market By being by following the model that I mentioned, but also growing its margin by well over 1,000 basis points And a brand that has extended itself now into all forms of home and hygiene categories, and it could have not been better timed what's happening in the market and managing consciousness today. This takes me to the next segment of growth, which is really transforming a portfolio. Having strong brands, base brands is very important. We're getting us to the next level.
We really need 2 things. 1, we have to premiumize because we found that there will be premiumization is already 70% of our growth contribution. And 50% of our business is what we'd call in the 120 index average and above now. And this was well in the 40s and below that in many years back. And this transformation is really helping us.
And we see really 2 simple things. And this in a sense is sort of the goal of serving the high tier consumer in most part is to really use digital tools to improve the speed of the market, Get to the market fast by listening, prototyping, aligning and testing it out and then scaling it. And we see that we can do that quite fast on the market. And importantly, Amplify it really using 3 things: targeting, using our digital hub using influencers for partnerships to engage and convert once you have the right audience and right target consumer and then using the loyalty management tools to increase the basket size because the cost of recruitment then gets paid off the value of the consumer. And this has become increasingly important.
One brand that really sums up all of this with excellence in our portfolio is Vaseline. Vaseline started off as a very simple portfolio 3 or 4 years ago. It's since then leveraged its base equity and become a really powerful brand. It's already number 1 in e commerce in terms of market share and growing. It is now covering from a simple body care to all of our body parts from tip to toe, leveraging its capability in healing skin and now is available in Some of the innovations like Delmar series that you can see right in the front has done extremely well and is getting into new segments like baby care and sun care.
So this really is and it's already 4 times more value density than it was 4 years ago. So we and we see a lot of opportunity in premiumizing our brands even further. So it's a great example of what excellence looks like when you take great equity and premiumize that in China. The second driver of transferring a portfolio really is to play in segments which are growing of us. These are for us, we have chosen these 4 or 5 segments to play in and have launched a portfolio of brands, hygiene for obvious reasons.
Now we have launched relaunched Lifebuoy, Domestas for home care and stretched for existing brands like strong power brands like Omen Luxe and a string of very good dividends. These are really all superior products offering unique benefits to consumers at a very, very good value. In home foods, we have a very strong conor brand in food solutions, and now we have, with success, started extending that into in home use, so with better use sauces, and we've seen success there and we keep driving this forward. Health and well-being, we've launched 2 brands, Ollie and Smarty Pants. Ollie particularly is doing quite well.
Smarty Pants is still down in the market, what we see very, very strong future for our housing market portfolio and premium laundry with the launch of laundress, which is very high priced, but it's doing quite well, getting traction. Our We Sold Like a Personal Care product and extending our mega brand AHC into premium spaces of anti aging with the launch of the youth variant that you see on the screen. All of these segments, even though they're about 1 or 2 years old, already in total available over a 1,000,000,000 in I mean sales, which is already gives you the sense of opportunity we have in extending them in many more years to come, make them our future call. They're all really going very, very fast at 3 times and we see a lot of opportunity in driving this forward as we take them from e commerce all the way and expand that across offline and scale them up. Now coming to the last growth slide, which is really about going where people go, Which really means 2 things.
1 is going digital. Let me first spend a time little bit of time on digital. It's obvious that You know digitization, the e commerce is roughly 30 odd percent of the CPG market in China and growing at roughly 30%. We saw massive growth in 2020 and then a bit less slowdown this year. But on the whole, if you look at the over 2019, the growth is still very, very handsome.
It. And really, we are already 40% of our business, dollars 3,500,000,000 is $1,300,000,000 is digital. We see this going towards 50% and not so far future. We see 3 broad drivers and pillars to succeeding and why we see success even in competitiveness in e commerce in China today with Unilever. 1st is very close partnership with our key platforms, it.
Whether it's B2C platforms like Ali, Jerry or Pinduoduo or the new emerging platforms like ByteDance and WaiSho or Tencent, of course, Which is very, very massive in the social space or even the auto players, which is basically the omni channel, which has really growth quite grew quite handsomely In the last 1 years, sort of for us, it's a well inaccessible market. We have very high shares, so we feel very good about that. And really playing working very closely with our partners like Jerry Daoja, Shindranda and Maitva and others like that. On the content side, because it's very that's what consumers see. They're not in the store.
What they see is basically what they see on the phone. You've got to make sure that your content is shoppable. For that, it simply really means 4 things. 1, we've got to execute well on any moment. We must be perfect, And we have a very clear strategy that we track on a real time basis daily on how we're doing in YesStyle.
But really, it's the key thing there is to be available online, which means in some parts also only the key search words. It's very important to have the engaging content and Talk to deals are really growing in popularity and gives us a great opportunity to show products with the audience like the one you see on the screen right now. Live streaming, which I mentioned, has gone massively over the last year or 2 and really support good partnerships to the top celebrity endorsers, but even our own live streaming and making that big and making sure that we drive that profitably. And leveraging and harvesting the consumers that actually shop from us to become members Through increasing the basket size, such as regime samples and other things that we do to really create stickiness once they are really part of our franchise. And finally, it's very important not to see this entire digital comms or even the broad platform of customers as one big mess.
They're very, very unique. We might need more novelty like the Dove formats you see here for TikTok or Dohin. We might need scrum value brands like Ghislaine to play Grindriddo with value. And we will also need for the omni channel 2 platforms like Hamma from Ali, a specific warehouse exclusively design for them, for their customers. It goes with, for instance, a dish bearing, which is a very popular industry.
So it's really about designing for channel, And we believe this is a critical ingredient in our success. And I think close to almost half or more of our portfolio is already exclusive in some way for the channel when it comes and platform and customer when it comes to e commerce. Finally, on the point of going deep, as I mentioned to you, It's very important for us to increase our presence in the smaller cities. And what we've now started doing is After having expanded our network, for us, the next growth journey is in organizing ourselves around city clusters. We see that cities are really the economic unit of China.
And cities around the big cities tend to really become the most promising parts of the open areas that really for a company like ours are very attractive. So we've taken the entire country, divided them in 300 city clusters and chosen top 100 of those that correspond to 60 odd percent of population and 80% of those are offline business and further segmented them depending upon our competitive position. So very, very clear, in which city clusters, off priority, you need to do what on importance. And we want to organize them around city customer managers to give end to end responsibility, one big city with A, B, C, D or Tier 1, 2, 3, 4 cities. It's a collection of cities under one person who we can actually hold accountable end to end and organize our analytics to make sure we can track outcomes and investments on a semi cluster basis.
And eventually, it's really our job and mission to create a digital platform that gives us a high level of control and execution. Are we getting it more sourced? Are Are we making them better through better range quality? And are we getting stronger engagement with our customers, especially wholesale that will keep playing a very important part And we're getting our products to the groceries along with the e route to market where again we've got lead by having early strategic engagement with the big platforms the company. And finally, we are investing and upgrading our digital infrastructure for our go to market capability, And this is going to become an amazing force.
I expect that we our ambition is to be the best in class and do a next generation level job. It. Coming finally to a touch on the enablers, and I know that given the time, we will allow you to go deep in this, but I made a strong point already about digitization and transformation of our grow the entire layer of grow, power, make, run and make sure all of that is digitized. Productivity. We are already delivering a strong track record of 9% to 10% of our spends every year through our global tools of NRM, 5S for materials, our nonmaterial savings, our overhead, ZEB for BMI.
We are continuing to drive 9% to 10% of opportunity that can be helped and use for fueling the growth by reinvesting all the white spaces and opportunities mentioned. And that will continue to be a strong muscle we keep deploying in the future and making an organization even more agile, not just balancing structurally the focus on scale, but importantly, expanding what has successfully been observed in a company on the agile ways of working across the company more widely and flexible resourcing, which is already quite skilled and newly with China to become really a generative core of the company. So in sum, If I can conclude, what I'm really trying to do in the last 30 odd minutes or less is the following. And I'll still talk through a few headlines. Again, the winning in China is absolutely a must win for Unilever and we would call out as the top 3 market set in the newcomer strategy.
It. It's already our 3rd biggest business, and there's a strong headwind for growth, future growth potential at Amazee. And we've got to stay We can think through ups and downs and this is going to really remain a very exciting growth story. And we have not we've delivered consistently, profitably over the last 5 years, we have credibility, and we like to continue to do that in the years to come. And we are coming stronger through the pandemic, more competitive, more agile and more digital.
And we expect to consistently remain disciplined around our 3 core priorities and enablers: getting our core big brands into more households all the time, transforming our portfolio into future fit portfolio mainly through premiumization all the other existing brands of our premium brands, getting them in more households or indeed launching into premium categories or new premium brands And also getting behind categories that have got high tailwinds like hygiene and health awareness. And finally, go where people go. That for us really means really lead in digital commerce, be absolutely on the top of that gain. It's already going to be, I think, in the near future, half our business and make sure we leverage the white space opportunity when it comes to launch of the cities by going deep and building a strong robust infrastructure and ability to reach more outlets better in the launch of this. So that really brings me to the end of what I wanted to say.
And I'll now hand over to Richard, so we can take some of the Q and A at this point. Us. Thank you very much. Mr. O'Gio?
Thanks, Rohit. Just as a reminder, if you want to ask a question, then just submit it in the Q and A box, which is underneath the the presentation. So the first question is from David Hayes at SocGen. We have seen renewed restrictions on travel and movement in the last few months. Have they been a setback for out of home recovery and reopening or has there been no material impact on social behaviors and out of home demand levels.
So to respond, I think as of Half 1, we had seen a significant improvement in our Food Solutions business and our ice cream business, which are both focused in our home. And I must say that we normally we have exceeded both definitely the we recovered from 2020 A drop, but also increased actually beyond 2019. So we were we had a good trend when it comes to Food Solutions. Similarly, on Ice Cream, we'll be again, I would say going from strength to strength in this year. Yes, there is some impact in the recent times because of the regional stoppages.
But frankly, this does tend to be more regional in nature. And the government is pretty Capable of managing it on a segmented basis, and we see basically a few weeks of closures and restrictions and then going away. It. And it's sort of become a muscle that both us or companies like us, but also consumers have got used to And sort of just living with COVID, so to speak. And I think eventually, it is temporary up and down, but I would say that consumers are reasonably confident in China when it comes to other home consumption occasions as we speak.
Thanks, Rohit. It. We have another question in which is from Eva Quiroga, Bank of America. What's the medium term opportunity for prestige beauty now that the regulatory environment has changed? And what are the first thoughts following the Kate Somerville launch?
It. Well, I think I really love our prestige portfolio. Frankly, I've been I've been rooting for it to be in China for many years, and We have very good reasons and we were working very closely with the government and other players in the industry and now the animal testing regulation has been liberalized From early this year, and it's still conditional, but liberalized nevertheless. And we've been working again very closely with regulatory affairs and we are amongst the first company, actually the first company, To get certification for, I think, 2 of our products. And one of them is Ked Samumwal.
And I am absolutely certain that it. When available freely in local e commerce, the brands have a very strong future and brands like Dermalogica, K. S. Dumbbell and many others that we have, Really, many of these have very strong traction and cross border where we have now a joint venture with another company. So we are already getting prepared.
And I see increasingly more and more opportunity in this space, especially as you've known that over the last few years, and I do feel that even in the future, the premium and the prestige the end of the portfolio, we continue to grow and we have a very, very strong portfolio in stable brands and I'm very, very optimistic about their future in China.
Okay. And as a follow-up question to that, which you have half answered actually, but from Guillaume Delma at UBS, which is, what do you see as being your main competitive advantages in prestige beauty.
I am actually speaking for the team. I think they're better it. But just as an important stakeholder, somebody who really loves these brands and I would love to see the business grow in China, I think at the end of the day, it's going to be really about brands. And I think some of brands already, like I said, when we have demonstrated them, exhibited them in like CRIE, which is importexport exhibition that happens every year with all these participants. Prestige always has a stall there.
You can already see how many of them have a strong social buzz and the opportunity that there is. And I think the brands and technology and what it stands for. And also the fact that we've been very steadfast about our values and not testing on animals, all of that will certainly work to our advantage because consumers are getting more and more sensitive on the environment and all of these brands have very, very strong stories on that front as well.
Thanks, Rohit. Well, we've got a popular subject, a question on premiumization. Does the premiumization of Dove make sense? Or does the move to bring in new brands such as Dermalogica, okay, somewhere, etcetera, does that introduction get Unilever bigger in Prestige more quickly?
It's an and question, not an or question because both Dove and Dermalogica have a role to play. We're talking a very a large market with a huge price pyramid. And we've anything I've seen, certainly in my 4.5 years in China, we've done a doubt to premiumize that. It's paid off for us. We have already, for instance, on the scrubs, that bathing scrubs, we are a very successful entry with Dove.
We I've made successful entry with forms, with Dove, and the Bascome Body is an amazing opportunity for Dove as well. And I feel that Dove as a brand in the consumer's mind is much, much bigger than an actual physical sale. And I feel that that's the job we have to do is to really fill that gap. And I'm quite certain that's going to happen because every premiumization in Temodar works. That doesn't take away from the opportunity in Nasty's prestige space because that's and across segments, because we're talking very, very vast.
I'm talking with tens of 1,000,000,000 of euros in market. It. So therefore, double logic as well has a strong opportunity and it can be and will be a very big brand in China when it's fully available.
Okay. Thank you. So let's move into a different category. It's a question from Warren Ackerman of Barclays. Can you discuss the trends of Chinese Laundry?
Players like Blue Moon have IPO ed and are quite aggressive, but you have said you have grown share by 100 basis points the margins by 1,000 basis points. However you achieved it, what can Chinese Laundry grow for Unilever in the long term?
So I think that's really an excellent question. And I think Omo in a sense has been the lighthouse of many of our big brands and how we can actually learn how to grow a big brand competitively. At the heart of almost success is really 1st and most important is competitive products. We have almost universal superiority and subcontracts in use, us. And that has been a big driver of growth.
2nd has been consistency of our proposition of using a proposition beyond the obvious experience and get dirty, appropriate for China. So adapted for China. And we've been consistently on that ever since and build a strong memory structure. 3rd really has been the fact that we focus very, very squarely on the opportunity of Lequis where we are trying to really make follow the tailwinds of eQuiz, grow the category rather than participate in the bottles in the bar segment more aggressively. So So we've been very focused on that.
And in the recent past, we've also made a very, very clear choice on driving the growth in cash flows, which again is a great offer for us to be the number one brand in offline, we're doing extremely well in capsules as well. We've also indigenized that. We've built local capability. We've adjusted the formulation for the Chinese consumer. So it's really China for China in action as well for OMA.
And now the last lever of growth is that we've taken a brand that Very well known. So, I think these we're going deep in white, so we're taking it to West, North and South. And we are taking a very well known brand like Omen and extending that to categories beyond laundry into home and hygiene care, and that's working very well, dishwash, which is already a sizable business. So all of these things essentially give you give us the formula on how we can actually take a big brand and make it much, much bigger. For me, it.
I think OMA has a lot of opportunity to grow in China, not just with this. Like I said, we have 3 parts of the country that we still are, huge white space from a point of view of geography. So we have a lot of distance to cover. So I see a lot of views of growth normal.
Thanks, Rohit. Now we're going to change and the question about distribution from Catherine Lockett, M&G. How do you manage expansion into lower tier cities with physical distribution alongside development of group buying, PDD, etcetera. What are the relative merits and drawbacks of group buying systems for Unilever?
Let me first start by giving a sense of so what you've done is obvious, like I mentioned, we have low penetration and Low tier cities are growing faster than large market. We'll keep going further. So we have to play. We have to play because everything we do is basically value adding for us. But of course, it's not that easy as that because we're talking a very large geography and we've been doing that not 1 year, but over the last 4 or 5 years, building deeper infrastructure distributors and making sure we don't just get distributors, but also like to like growth.
And that is paying off as one rule of loyalty or city presence. The second has been e route to market. That has also become sizable for us. Through the Ali and JD platforms, we were early with them. And the B2B now, 3%, 4%, 5% of our sales, that has given us presence in grocery stores that we are not covering direct.
The 3rd group of course is wholesalers that continue to play a part. So what I'm saying is to get to the Lautier series, we really need multiple levers and a bunch of routes to market, not just 1. So we keep doing that because there's no end to this process. This is a very, very vast company. We have a lot of When it comes to Pinduduo, Pinduduo as a platform, Domee has started with very strong value propositions and also loyalty city biosphere has become pretty universal.
As you have seen from their results, they said that they're already amongst the largest And they're used, so they're being used by nearly everybody. And we are working very closely with them as well. We're one of the top 10 strategic partners. It. It's early years and we have and so far as when you talk about how do you create the right balance, we do have very 2 conscious strategies.
1 is we have an omni channel pricing strategy. So we make sure that anything we launch basically doesn't create price conflict across that's really very important in China within multiple channels from B2C to B2B and O2O and then now group buying. And the second really is to have some exclusive our biased portfolios, like I mentioned, hazelined, for instance, that is really more tuned into the shopper profile of Pinduoduo, on the other hand, will have something that's more suited to the sharper profile of Jade. For instance, clear nail is quite big there Or something that's suited to the shopper profile of Ali, for instance, our skincare brands are much more popular than Ali. So there's always a bias that we can serve that makes us gives us a little bit of distance between different platforms.
Okay. I just see the time go ahead. Let's just squeeze in one last one. It. Can you say a bit about inflation in China and your pricing reaction to it?
It. Sure. I'm sure this is the top of the mind of all the people concerned, and it's on top of the mind and one of the things that we discuss every month and every quarter in our sales and operation planning, looking for our goods. In 2021, we were fortunate that we managed to prove various levers. And if you look at basically margins.
We were able to improve our margin in 2021 in the business in China because we were able to drive structurally our costs down through localization, through better buying savings, through longer covers our enterprise logic, improve our mix, which has really been very important driver of sales and growth By a significant percentage this year and in a sense, therefore neutralize the price inflation, especially in the first half. It was not so much in the second half. We did see that coming through, but we were able to we think we will be able to manage that well this year. But having said that, we do know that based on the inputs, global inputs, that the inflation is likely to get even more extreme in the year to come, and we are prepared for that. We are constantly looking at our pricing analytics and what we have, what we call it, net revenue management muscle.
And we are ready, and we will be designing and deploying in time. We're very, very close to what's happening in the market. In some cases we will lead, in some cases we will follow, but this is something that we do all the time. This is really hard. This is a very strong muscle, both in the cost and the mix and and the price landing and the designing end in the company, right, really top of the mind.
Thank you, Rohit. It. I think we're going to have to stop there. We've run over a little bit. Just to remind everybody that the presentation will be available on our website.
Us. Thank you, everybody, for joining and dialing in. And especially a big thanks to you, Rohit. Thanks for your time. Thanks for a great presentation.