Kimberly-Clark - History, Evolution, Present and the Future
-
Upload
greg-thain -
Category
Marketing
-
view
570 -
download
3
description
Transcript of Kimberly-Clark - History, Evolution, Present and the Future
History & Origin . . . . . . . . . . . . . . . . . . . 3
Early Evolution . . . . . . . . . . . . . . . . . . . . 4
Global Expansion . . . . . . . . . . . . . . . . . 6
Modern Business . . . . . . . . . . . . . . . . . . 8
Company Structure . . . . . . . . . . . . . . 10
Recent Efforts . . . . . . . . . . . . . . . . . . . .11
Company DNA . . . . . . . . . . . . . . . . . . 14
Summary . . . . . . . . . . . . . . . . . . . . . . . 15
Social Media Accounts . . . . . . . . . . . 16
2
Charles Clark initiated his five co-businessmen to buy a paper mill
on March 26, 1872
Charles Clark, John A. Kimberly, Havilah Babcock, Frank Shattuck,
and George Whiting raised $30,000
The first paper mill was located at Fox River in Neenah, Wisconsin
Eight years later, it opened a second mill
It was then incorporated as Kimberly, Clark & Co, with a
capitalization of $400,000
In 1892, it expanded into bond and ledger paper production,
making it the largest paper company in Fox River
In 1893, it was making 55 tons of newsprint a week
It went through a three-year depression after good times in
America closed
In 1895, the company’s profit fell by over 70%
3
In 1912, recruiting of organized technical department came up
Ernst Mahler, an Austrian chemist was recruited in 1914
Mahler came up with a product called Cellucotton wound dressings
Kimberly-Clark dealt with Surgeon-General of War Department to
supply Cellucotton during European war
By 1917, the company was shipping Cellucotton as fast as they
could make them
The war ended in 1918 which also implicated an end for
Cellucotton
Mahler and Kimberly collaborated with Walter Luecke and came up
with Kotex sanitary napkin
Women consumers objected the selling of Kotex in stores because
of sensitivity
Cellucotton Products Company (CPC) was built to avoid Kimberly
Clark’s association with Kotex 4
It was then considered an embarrassing product
Luecke thought of coming up with an advertisement, encouraging
retailers to place Kotex’s box on the counter by the till
Kotex then sold in singles, via vending machines in ladies rest
rooms
In 1923, Kleenex Cleansing Tissues sold as a cold creamer remover
Then they renamed it as Kleenex Disposable Handkerchiefs, after a
survey revealed that consumers used it to blow their noses
Kotex experienced a challenge when Earle Haas developed
Tampax tampons
In 1957, it acquired Schweitzer Inc., a cigarette paper business
In 1959, it purchased American Envelope Company
Competitors and consumers’ changing brand preference made it
hard for Kotex and Kleenex to stay in the game, but it managed to
give P&G a good rivalry 5
In 1925, the company began selling its products in Canada.
It formed a UK subsidiary to market Kotex and Kleenex
In 1955, they signed up a British contract manufacturer to make
Cellucotton under license.
The company also bought LA Aurora Paper Company in Mexico.
LA's factories eventually supplied selling operations in Central and
South America.
In 1957, the British venture was used as a springboard into West
Germany.
In 1959, a ten-year deal was signed with South African Pulp and
Paper.
Invested $200 million for its expansion in Europe, Latin America,
Australia, and the Philippines.
6
During the 1970s, 20% of the company’s operating assets were
located outside the US, primarily in Europe and Mexico.
Kimberly-Clark was far behind P&G and Scott Paper
The merger with Scott Paper in 1995, opened doors for wider
international expansion
They also made acquisitions in Switzerland (serving Germany and
Austria), Spain and Portugal.
In Taiwan the company bought out the Kimberly-Clark and Scott
Paper joint venture partners, and merged to form Kimberly-Clark
Taiwan into one of the country’s biggest consumer goods
companies.
The company’s focus was to expand its presence in emerging
markets particularly Brazil, Russia, India, China, Indonesia, and
Turkey
Today, almost 50% of Kimberly-Clark’s sales are generated outside
US but less than 30% of operating profit
7
The turning point of Kimberly-Clark was the appointment of Darwin
Smith in 1971
His vision was to build resources and capabilities to become a
fully-pledged consumer business
Johnson & Johnson’s Stayfree brand launch became a great
challenge to Kotex
By 1975, its nearly 60% market share in 1970 had declined to 35%
It eventually bottomed out at 15% in mid 80s
It then launched Kimbies as rival to Johnson & Johnson’s Pampers
Kleenex and Kotex were facing an end
The company managed to improve Kimbies through cash influx.
Launched the Kotex Lightdays Panty Liner in 1975.
By December 1977, Huggies was launched with Kleenex on its
front in Winconsin and Michigan
8
In 1983, Huggies achieved fully national distribution with 21%
share
Huggies overtook Pampers that lead the market by 1985
In 1995, Kimberly-Clark made a union with Scott Paper
It was then the number two in consumer paper products behind
P&G
By 1999, it was turning over $12 billion a year
Purchased Ballard Medical Products
Followed by various acquisition including Safeskin, and a Polish
tissue business
In November 2004, the company spun off a new subsidiary,
Neenah Paper
The move was to divest its remaining paper and pulp mills
businesses
Smith’s goal of turning the company into a packaged goods
business was achieved
9
In 1955, the first major change happened. The re-incorporation of
CPC back into the Kimberly-Clark main hierarchy.
In 1959, separate divisions were created for Schweitzer cigarette
papers, Newsprint, Canadian operations, Consumer Products, and
a small International Division.
After the Scott Paper merger, it settled in three divisions: Personal
Care, Consumer Tissue, and Business-to-Business
By 2004, United States, Canada and Europe were consolidated into
a North Atlantic Group.
By 2006, Business-to-Business division was split in Professional
and Healthcare groups.
Professional and Healthcare reflected the increasing size and
specialisation of the healthcare business, and had little in common
with Scott Towels and Kimberly-Clark industrial wipes.
10
2004
Kimberly-Clark had annual sales of over $15billion
Product innovation like Kotex Lightdays, Huggies Convertibles, etc.
Huggies brand was extended into bath and body products
Gained number one position in the US in medical products
2005
The company sales grew 30% in BRICIT markets
Acquisition of Microcuff GmbH, boosted Healthcare strategy toward
higher priced products
2006
Sales increased with another 5%
Volume growth all came from Personal Care and Healthcare
divisions11
2007
A 9% sales increase was recorded
In Personal Care Division, a volume increase of 8%$50 million
increase in marketing spend for Huggies
Growth of 21% in the developing and emerging markets
China, with sales growth of more than 40%
2008
BRICIT markets advanced another 30%
Product innovation like Kleenex Facial Tissue with Lotion
2009
Personal Care division grew volume by 2%
Healthcare grew volume by 14%
International wise, Personal Care products were up by 15%12
2010
Personal Care division grew volumes by 3%
Healthcare had a volume increase of 7%
2011
International businesses were handled by a management group
called K-C International
Product innovations like Huggies Little Movers Slip-On Diapers
2012
K-C International sales were up 9%
Volumes were up in Personal and Health Care
Exited diaper category in Western and Central Europe
13
Both Kimberly-Clark and Scott Paper built their businesses by
understanding paper and the company still has much expertise in
the area with Kleenex, Scott paper towels, Andrex and the like.
In the world of consumer-packaged goods, every brand is a bond
of trust between brand owner and brand consumer. Kimberly-Clark
operates in areas that both require and engender a very strong
bond of trust.
The company’s product fields, over the decades have built up an
institutional expertise talking to consumers about difficult or
embarrassing subjects. This requires an in-depth body of
knowledge on how to do these things well and to adapt the
conversation over time to reflect changing social norms and
differing cultures.
The company’s brand expertise is useful in almost everything,
enabling it to reach a wider market14
Kimberly-Clark is a good example of how understanding the
company’s history and development can illuminate issues in the
business today.
Kimberly-Clark was built on three events:
The invention and propagation of Cellucotton
Selling of the mills and taking on Procter & Gamble in diapers
The merger with Scott Paper
These events resulted to various developments:
Turned a paper company into a packaged goods company
Helped the packaged goods company develop a dynamic set of
new and growing categories
Opened doors for the company to venture into growing set of
new countries
15
Website: www.kimberly-clark.com
LinkedIn: www.linkedin.com/company/kimberly-clark
Facebook: www.facebook.com/KimberlyClarkCorp
Twitter: www.twitter.com/KCCorp
Youtube: www.youtube.com/user/KimberlyClarkComms
Google+: plus.google.com/u/0/100428948660476595716/posts
16