Procter and Gamble Marketing capabilities

Introduction

• Procter and gamble is the largest manufacturer of consumer products.

• One of the top 10 largest companies by market capitalization.

• Founded in 1837, headquartered in Cincinnati by William Procter and James Gamble.

• Mainstay in America business for over 150 years.

• Known for successful brands, introducing new products and maintaining popularity.

Timeline : Growth and development

New stage of innovation

1891-1945

Dynamic growth

1945-1999

2000- Today

Timeline : Growth and development

New stage of innovation

1891-1945

Dynamic growth

1945-1999

2000- Today

•Expanded its operations to across the nations.• In depth understanding of consumer needs.• Progress to develop new products• Established overseas subsidiary through acquisitions

• Expanded its product lines to toothpaste, paper, diaper and foods.• Started focussing on healthcare, cosmetics and fragrances through acquisitions.• Established a worldwide research and development network.

• Started changing strategies to create a competitive advantage.• Focussed on growing categories and brands.• Merged with Gillette to increase its product mix to 22 brands.

Industries

• Beauty• Grooming• Healthcare• Snacks and pet care• Fabric care and home care• Baby and Family Care

Marketing strategy analysis

P&G’s marketing strategy has four component as follows :

•Consumer and market centric research and approach

• Mergers and acquisitions.

• Designing and innovation.

• Advertisements and promotions.

Consumer Centric Research

Research methodQualitative

Quantitative

•Group Discussions• Interviewed consumers at home• In-store interview• Employed psychological surveys to measure mood

• Gathered data on consumers utilizing blind tests• Concept and use tests• Quality monitoring• Large scale studies of habits and practices of consumers

Acquisitions and Partnerships

Acquisitions• Charmin Paper Mill (1957) : Opened up the household paper products market (toilet paper, paper towels) for the company

• Folgers Coffee (1963) : Gave P&G a presence in the food category.

• Crush International Limited (1980) : Get them into the soft drink industry.

• Norwich Eaton Pharmaceuticals (1981) and Richardson-Vicks : Pharmaceutical industry

• Noxell (CoverGirl and Noxzema) (1989) : Led them to the top cosmetic company in US.

• Gillette (2005) : Made P&G the top consumer goods company .

Designing and Innovations

• Started doing partnerships and connections with non-P&G scientists and engineers to increase the input researchers.• Nurturing ideas created by the business development team that did not relate to an existing brand.• Emphasize designing process to help consumers recognize, understand, and in some cases even imagine the functions of a given product.• The influx of design had a strong impact on P&G’s product development; design informed the innovation process and even changed the function of some products

Global Business

Units

Market Developme

nt Organisati

onPerform intensive market

research to ensure global

product’s success

Focussed on innovation in

existing areas

Advertisements and Promotions

P&G reconsidered its advertising strategies in a more direct form to better meet the company’s global market and consumers Celebrity Endorsements

Advertisements and Promotions

Sponsorships

Advertisements and Promotions

• Product based websites.• Mobile add campaign “irrestibilty quiz”.• Old Spice YouTube video campaign attracted 13.7 million people.• Separate Facebook page for each product. • Manofthehouse.com for house hold advice to the men.• Capessa for women on YouTube.

Social media and Digital marketing

Financial Statement Highlights

Challenges and Problems faced

Competition P&G has faced a lot of challenges in expanding and developing their business in some unfamiliar region because of some existing local and global level competitors.

Challenges and Problems faced

•Poor economic condition of the region to expand in.• Negative consumers reaction to its Ads.• Challenges of using Information Systems.• Challenge of managing marketing budget during recession to lessen its impact over their sales figure

Swot Analysis

Strength : Strong focus on research and development. Leading market position. Diversified product portfolio. Strong brand portfolio. Acquisitions

Swot Analysis

Weakness :•Increasing instances of product recalls.• Dependent on Walmart stores for majority of revenues.• Poor website.• Environmental issues.

Opportunities :•Expansion in developing market.• Future growth plans.• Growing Indian Fmcg market.• Emerging men’s market .• Interest in natural product.

Swot Analysis

Threats :•Increasing price in raw material.• Regulatory environment.• Global economic conditions.• Counterfeit goods.• Intense competition.• Mergers integration

Disclaimer

Created by Aditya Deva, IIT Ropar during the marketing internship under Professor Sameer Mathur, IIM Lucknow