Several products were developed during the time period when William Procter's
son, William Alexander Procter, took over the company (1890-1907.) William
Cooper Procter began working in the company in 1883 and served as president of
the company from 1907-1930. During this time, the company's sales rose from $20
million to $200 million. This was a period of growth in which the company built
several plants: five in the United States, one in Canada, and one in England.
Over time, the company began to focus most of its attention on soap, producing
more than thirty different types by the 1890s. As electricity became more and more
common, there was less need for the candles that Procter & Gamble had made
since its inception. Ultimately, the company chose to stop manufacturing candles
in 1920.
William Cooper Procter was a pioneer in many labor relation reforms. Procter and
Gamble became the first American company to give half holidays on Saturdays
and set up a profit-sharing plan in the same year. Company policy was reworked in
1920, so that all employees were guaranteed 48 weeks of work per year. Other
firsts include a disability pension plan, a life insurance plan, and employee
representation on the board of directors.
Procter & Gamble acquired a number of other companies that diversified its
product line and significantly increased profits. Procter & Gamble has dramatically
expanded throughout its history, but its headquarters still remains in Cincinnati.
Today, P&G; goods are found in 98 percent of all American households. P&G's
dominance in many categories of consumer products makes its brand management
decisions worthy of study. P&G identify common consumer needs, develop new
product innovations and build its brands through effective commercial innovations,
marketing and sales.
INTRODUCTION:
Procter & Gamble (P&G) was set up by
William Procter and James Gamble in April
1837 to manufacture soap and candles in the
U.S. Today it is a $79 Billion personal care
and health and wellness company,
manufacturing a broad range of products and
employing 140,000 people all over the
world. P&G's products are sold in 160
countries. P&G has operations in more than
80 countries, with more than 300 brands. These include beauty care, household
care and Gillette products. Three billion times a day, P&G brands touch the lives
of people around the world. The Procter & Gamble Company (P&G) is a giant in
the area of consumer goods. The leading maker of household products in the
United States.
Committed to remaining the leader in its markets, P&G is one of the most
aggressive marketers and is the largest advertiser in the world. Many innovations
that are now common practices in corporate America--including extensive market
research, the brand-management system, and employee profit-sharing programs--
were first developed at Procter & Gamble.
MISSION:
Procter and Gamble is one of the most admired companies in the world. They take
pride in their products, values and principles and involvement in the world. Their
mission or purpose reflects this pride. Their mission, as stated on their webpage, is
that “we will provide branded products and services of superior quality and value
that improve the lives of the world's consumers. As a result, consumers will reward
us with leadership sales, profit, and value creation, allowing our people, our
shareholders, and the communities in which we live and work to prosper”.
Procter and Gamble’s quality products are the result of their massive investment in
research and development. They are continually improving existing products and
brands while creating new products. They understand what their consumer wants
and have the technology to develop the products that will meet these wants. P&G
is its people & the values by which they live.
They recruit the finest people in the world. They build the organization from
within, promoting and rewarding people without any difference unrelated to
performance. They work on the conviction that the people of P&G are the most
rewarding asset.
VISION:
Their vision is, “To be recognized as, the best consumer products and services in
the world.” Having clear vision of where they are going, they are focusing the
resources to achieve leadership objectives and strategies as well as developing the
capability to deliver the strategies and eliminate organizational barriers. Procter
and Gamble will continue to serve consumers by continuously innovating products
that will allow them to be leaders in household and personal care, health care, and
food products. To produce products with the utmost care to give nothing but
quality to our communities. And to continue to grow so that we can maximize our
shareholder’s wealth.”
Beyond just making the best products, Procter and Gamble tries to improve the
communities that they touch around the world. The company believes they have a
social responsibility to these communities. On the basic level, they provide
products that improve the lives of their consumers in terms of health and
convenience. By treating their employees fairly they contribute to their social and
financial well-being. On the global level, they give aid to philanthropic programs
such as Humanitarian and Disaster Relief. Procter and Gamble also produces
products that are safe to the environment in both production and in their use. They
strive to better the quality of life for everyone both now and in the future.
GEOGRAPHIC SEGMENTATION:
P&G has expanded significantly, but its headquarters still
remains in Cincinnati. Today, P&G; goods are found in 98
percent of all American households. With additional products
are sold worldwide, from the Arabian Peninsula to Argentina
to India, the company remains committed to marketing
superior products. Its manufacturing operations are based in
the following countries.
United States
Canada
Mexico
Latin America
Europe
Africa
Australia
IN PAKISTAN:
Procter & Gamble started its operations in Pakistan in 1991 with the goal of
becoming the finest Global Local Consumer Goods Company operating in
Pakistan. Procter & Gamble is marketing a range of consumer goods products
including 13 brands comprising shampoos, detergents, soaps, baby care, feminine
protection, and Vicks and snacks products. The company, which serves over 5
billion consumers in 140 countries worldwide and
markets more than 250 brands, produces bar soaps
and repacks bulk shampoos and Pampers brand of
diapers into sachets and smaller packs respectively
at its Hub plant near Karachi. P&G's Pakistan
operation is relatively small and yet it has been
successful to improve the lives of consumers here in Pakistan, like elsewhere in the
world. It has served over 140 million consumers in Pakistan, which equals the
entire population of the country since its operations 11 years ago. The company is
exporting bar soaps manufactured here in Pakistan to Saudi Arabia, Yemen, Syria
and Afghanistan where it is in great demand due to its high quality and competitive
price. Since the inception of P&G Pakistan, till today they are performing one of
the most thriving operations in Pakistan.
Vice Chairman
Board of Directors
PRODUCT MIX:
The company has categorized its products into
3 "Global Business Units" with each Global
Business Unit divided into "Business
Segments".
1. Beauty Care
• Beauty segment
• Grooming segment
2. Household Care
The product line of P&G for different Global Business Units is as follows.
Olay
Herbal Essence
Pantene
Head & shoulders
Pert
Wella
Zest
Gala
Dunhill fragrances
Lacoste fragrances
Hugo boss
Gucci fragrances
Safe guard
Cover girl
Dolce & Gabbana
Gillette
Ivory
Puma
Crest
Oral-B
Fixodent
Pepto Bismol
Zooth
Scope
Pringles
Vicks
Clearblue easy
Gleem
Glide
Household Care:
Pampers
Tide
Bold
Dawn
Charmin
Ariel
Swiffer
Bounty
Duracell
Cascade
Puff
Downy
Joy
All these products are available in different sizes, shapes and forms.
INDUSTRY ANALYSIS:
TRENDS IN THE MARKET:
Procter and Gamble’s main industry in which they compete is Personal Products.
The industry focuses on selling products that meet the needs of everyday
consumers in areas such as personal hygiene, beauty and health, pet care and other
household products. A major issue within this industry is the contaminated pet
food. Many companies have been forced to recall their pet food products because
of the dangerous and harmful threat it poses to animals. Consumers want a
product that they know will be safe for their pets. These customers of the personal
products industry have begun to look elsewhere for their pet food products taking
revenue away from the leading companies in this industry such as P&G. These
companies must regain the trust of these customers by putting a product on the
market that is safe for all pets and take all measures to ensure that the
contaminated pet food is off the market.
Another growing trend in the personal products industry is for companies to
make environmentally safe products. More and more consumers are becoming
aware of the impact, which everyday personal products have on the environment.
Global warming and our actions in slowing it down has become headline news.
Companies must find ways to produce products that are safe for the environment
while continuing to be of high quality and of similar prices to past products.
Consumers are becoming more inclined to buy a product that is safe for their
family and is safe for nature even if it means they have to pay a little bit more for
it. To stay competitive, companies such as Procter and Gamble must continue
spending money in their R&D department to create safe and environmentally
friendly products.
COMPANY ANALYSIS:
Procter and Gamble is constantly trying to find ways to improve their
products related to personal and beauty, house and home, health and wellness, pet
nutrition and care. These are the company’s primary product lines and they are
continually researching and developing new ideas to improve the products.
Procter and Gamble has focused a lot of research on their personal and
beauty line. They have researched different types of hair and skin, and have
developed products to fit theses types. P&G’s hair product line deals with the
different lengths, treatments, problems and disorders of hair. They develop
products such as shampoos and conditioners and styling products to fit the needs
of the different hair types. Procter and Gamble conducts similar research on skin
structure, identifying the different types of layers and the genetics of skin. This
research provides insight into different skin problems including what effect the sun
has on the aging of skin. They have developed many different lotions, moisturizers
and oils to help take care of the skin throughout a lifetime.
Proctor and Gamble has discovered several innovations for their house and
home products. A lot of research was invested in combining laundry detergent
with bleach to provide consumers a single product for the laundry room. This was
a difficult task because of the composition of bleach and its effects on clothes.
They eventually found a way to make bleach safe for fabrics and stable when
mixed with detergent The research that was conducted to find a way to mix the
two was expensive but now the mixture of bleach in laundry detergent is
affordable for everyone. Another major innovation in the house and home product
line was the improvement of the paper towel, which involved a change in the
papermaking process. The “absorbent capacity, strength, flexibility, softness, and
thickness of structured tissues, and towels make usage more convenient, faster, and
comfortable”. These developments have set P&G above their competitors in the
house and home product lines.
Procter and Gamble has also invested heavily in research for their other
product lines that has resulted in many improved products. They have developed
different formulas related to toothpaste particularly Crest. In addition, they have
developed leak proof diapers for their baby care
line, Pampers. In their pet nutrition and care
line, Iams and Eukanuba, they are providing
healthy food products for animals.
SWOT ANALYSIS:
COMPETITOR ANALYSIS:
Procter and Gamble’s three main competitors
are Johnson and Johnson, Kimberly-Clark, and
Unilever. These companies match or come close to matching the revenue of P&G.
There are differences among the products sold between the companies but they all
have similar product ideas.
Johnson and Johnson has the highest net income of these companies. The
primary revenue generator for the company is their health care products. They
have a strong brand association with their Band Aid and Neosporin products.
Furthermore, Johnson and Johnson focuses on providing products to doctors,
nurses and patients that need and use these health care products. Johnson and
Johnson, as a company, strives to meet the need of their customers while providing
a fair profit to their suppliers and distributors (jnj.com). They also take
responsibility to give back to the community that they live in. Through their
quality products, commitment to their customers and giving back to the
community, Johnson and Johnson is a tough company with which to compete.
The Kimberly-Clark company dominates the health and
hygiene markets. Some of their larger brands range from
Kleenex to Depend Diapers. According to their website
kimberly-clark.com, they hold the number one and number
two shares in their markets in over 80 countries (kimberly-
clark.com). They base much of their innovation off their
customers’ preferences and wants. Their three concerns with
being successful are quality, service and fair dealing.
Unilever is a food, home, and personal care company. Their products vary from
Vaseline to Ben and Jerry’s Ice Cream. They focus on constantly enhancing and
developing products that better the lives of their customers. Unilever makes
everyday products for people that want to use a safe and healthy product.
So these three companies give a tough time to Procter and Gamble.
CUSTOMER ANALYSIS:
Procter and Gamble is constantly looking for new ways to meet the needs of their
customers. These customers range from men and women to cats and dogs. P&G
has a couple different ways they research to meet their consumers’ needs:
qualitative and quantitative. P&G conducts their qualitative research by having
focus group discussions, in-home visits in-context visits, and in-store interviews.
This allows P&G to interact personally with their consumers to get their opinions
and facts on how their products are helping or not helping them. Their quantitative
research includes habits and practices, blind tests, concept aided usage and quality
monitoring. The quantitative research is used to see habitual data and use this for
new ideas relating to how consumers use these products in their homes and outside
of their homes. Quantitative research involves larger groups and statistical data
analysis. These types of researches help the company in many different ways. It
can help management and improve the way they make decisions, it make it easier
to trace problems, and helps the company to focus on new, different ways to
maintain their existing customers.
PRODUCT LIFECYCLE:
PANTENE:
In 1947 the original Pantene hair tonic was launched. After the introduction and
launching of Pantene it remained in its introductory stage till 1983. In 1985 it
began to grow but the growth rates not very fast. For this purpose P&G launched
first product line of Pantene for women in 2003. After this the actual growth rate
of Pantene started. And now it is at top growth stage.
VICKS:
In 1983 Vicks was launched which started to grow within a short time period. It
acquired growth till 1990 and now it is at its maturity stage.
HEAD & SHOULDERS:
It was introduced in 1978 and remained in its introductory stage for a number of
years. In 1989 it started to grow and now it is at its maturity stage.
ARIEL:
Today Ariel is also at its maturity stage.
GALA:
Gala biscuit was introduced in 1988 it captured a lot of customers during its
growth but today it is at its declining stage.
ADVERTISING OBJECTIVES:
TARGET MARKET:
Being that Procter and Gamble has such large diverse product lines, their
target market is more than just one defined market. Because of this, Procter and
Gamble has gone to great lengths to recover data to determine their target market
with some individual products. For example Procter and Gamble uses the internet
to test how their products will do in their target markets. From online surveys,
P&G found that 80 percent of the potential buyers were woman between the ages
of 35-54. Also, Procter and Gamble went as far as videotaping consumers at home,
basically their own reality TV, to learn about the consumers and to reveal more
about what the surveys didn’t show.
As for the products sold at Procter and Gamble, the target market seems to
point to stay-at-home parents, more specifically mothers with children. With so
many cleaning products, feminine hygiene, personal and beauty care, baby and
family, and pet nutrition and care products, Procter and Gamble naturally targets
those who own homes. These individual are the ones that are most likely to use
and need the P&G products.
Procter and Gamble uses this motherly target market in the set up of their
website, pg.com, basing pictures, captions and arrangement around the female
attraction. The website has a feminine touch to it with colors. Not to mention that
almost all the pictures on the website are of females, most looking around the age
of 30. P&G brands use the same target markets as the P&G website in their TV
commercials, magazine ads and other advertisements (pg.com). Procter and
Gamble is targeting the homeowners market. Most of their products are used for
home purposes. P&G use target marketing, but their products are so well known
and used that not very much target marketing is needed, due to brand recognition.
P&G has created products designed specifically to target developing nations.
For example, in many countries consumers wash clothing by hand with limited
amounts of water. In response, P&G has launched Downy Single Rinse in Mexico,
China, Philippines, and 9 other countries.
While not as big as the homeowner market, Procter and Gamble also offers
business-to-business selling. According to their pgbrands.com website, P&G is
committed to boosting other businesses’ sales, increasing their efficiencies, and
improving these businesses profitability through their B2B resource
(pgbrands.com). P&G sells cleaning and laundry products, snacks, and coffee and
beverages to other businesses. P&G has built a strong brand name recognition for
their products and know that employees and customers of these businesses will
feel more comfortable with these goods because they use the same products at
home. Business-to-Business selling is another target market for Procter and
Gamble.
COMMUNICATION TARGET:
Communication targets enable P&G to find opportunities and tap into them. It
gives them the information needed to focus on the buyers that are interested in
what they have to offer. This saves both time and money in an ever-changing
society.
P&G uses several modes of communication to target its customers. The most
effective and widely used means of communication by Procter and Gamble is
through television and radio advertising. P&G also connects with its consumers
through internet and outdoor advertisement. They also utilize print media like
newspapers and magazines to inform their buyers about their latest products and
innovations. The communication target is also achieved through posters,
brochures, banners and many other similar forms.
BCG MATRIX:
Actually people don’t have time to look and study every advert because there so
monotonous and obvious that they've become a part of our daily lives but
subliminal marketing also has another subliminal level that dwells in the mind of
the consumer.
P&G mostly does it subliminal marketing through bill boards, banners, LCD
displays in big malls, different music tones for different products etc.
PRODUCT POSITIONING:
Product positioning is defined as the process by which marketers try to create an
image or identity in the minds of their target market for its product, brand, or
organization. P&G has positioned its brands in their customers mind by different
methods. Some of them are listed below.
FOR GILLETTE:
It has used Product description, Announcing Category Benefits. It has made
realized its customers that the Gillette razors are
Disposable razors
FOR VICKS:
Positioning of Vicks vapor Rub is done by showing a
Touch Therapy.
Product Description
A free access is provided to all the customers and they can have free samples as
well as solutions to their problems. One can enjoy the latest samples and coupons
from this site. Expert tips and advice for everyday life are available on P&G
brand sampler site. Special discount coupons are available for different products
like Ariel, Vicks, Puma, Pampers, Dolce & Gabbana etc. While for Pantene,
Head & shoulders, Pert and other shampoos free sample sachets are available.
Free trials are available for Tide, Oral-B, Crest etc.
EDUCATIONAL PROGRAMS:
P&G makes contributions, mainly in products, to some orphanages across Balkans.
P&G considers that education represents the cornerstone for a country's
development and progress. Therefore the company is involved in series of
programs supporting the education in several countries across Balkans.
2) P&G 2000 Program. To celebrate the new millennium P&G organized the
P&G 2000 Program. The P&G 2000 Program equipped 160 schools in Romania
with computer labs. To fund the project, Procter & Gamble allocated 3% of the
sales of its products.
3) P&G Learn to change the world Program. The objective of the Civic
Education Program "Learn to change the world!" is to educate children on
being good citizens, getting involved in making a difference in the community's
life and induce a positive, durable attitude of caring about the community needs.
Dedicated to the 13-14 years old children, the program includes two phases: a
theoretical phase during which children are taught notions of civic education and
project management, and a practical phase during which children implement
projects for the community benefit, with the financial support of P&G. P&G
employees are involved in the Program, as volunteer, acting as mentors to the
children on how to identify a need in the community, develop and implement the
projects. The program started in 2002 and in 2004 we implemented it in 2 other
cities in Romania.