CASE STUDY

PROCTER AND GAMBLE:

MARKETING CAPABILITIES

CASE ANALYSIS BY :NISHANT RAJIIT ROORKEE

UNDER THE GUIDANCE OF

PROF. SAMEER MATHURIIM LUCKNOW

PrOCTER AND GAMBLE

• Global leader in FMCG sector

• More than 2 dozen $1 billion brands

• First company to directly advertise to its consumers

in 1880s

BRAND PORTFOLIO

Billion Dollar Brands

Organizational Control System

• Market Development

Organizations

• Global Business

Services

• Corporate Finance

• Global Business

Units

Situational Analysis(1)

SITUATIONAL ANALYSIS(2)

• Dominates FMCG sector through various sub-brands and a huge brand portfolio

• Strong focus on Consumer Research,innovation,marketing and advertisement

SITUATIONAL ANALYSIS(3)

• In 2010,P&G had a market capitalization of

$186.63 billion with net income of $12.74 billion and sales of $12.74

billion

• P&G showed a global domination with more than

42% sales from North America,21% from Western Europe and 15% from Asia

ORGANIZATIONAL STRUCTURE : LAG OR lEADS

HISTORY(2)

• Started its international expansion in 1930s

• 1945-1980 : Entered the markets of Latin America , Western Europe and Japan

• 1957:Charpin Paper Mill acquired and 1963 : Acquired Folgers Coffee

• 1980s : Extensive global expansion

HISTORY(3)

• 1991: P&G became US’s

top cosmetic company with

Noxell acquisition

• 2005 : Gillette’s acquisition

made P&G top consumer

company for $57 billion

• Company stocks lagged

and senior managers left at

that time

P&G LOGO EVOLUTION

WHY STUDY THIS CASE ?

CASE

OBJECTIVES :

STUDY OF USE

OF INTEGRATED

MARKETING

CHANNELS

CASE OBJECTIVES :

UNDERSTAND THE

MARKETING

STRATEGIES USED

BY P&G

CASE OBJECTIVES :

TO UNDERSTAND

THE SECRET SAUCE

TO MARKETING

SUCCESS:

INNOVATION

INNOVATION :THE SECRET SAUCE(1)

• Year 1887 marked the establishment of earliest marketing division

• Replaced the existing 4 geographical units with Global Business Units

• GBU :

A three team supported unit consisting of

1.Venture teams

2.Business Development Organization

3.Market Development Organization

• Company named the strategy : “Connect to Develop”

INNOVATION :THE SECRET SAUCE(2)

“50% new products in 90s developed in Labs and rest with non-P&G scientists and engineers”

&

“Products like Swiffer Duster,Olay Regenerist,CrestWhitestrips etc came into existence”

MARKETING AT P&G

MARKETING STRATEGY (1)

• Year 2000 : Lafley took over as the new CEO of P&G

• Set up of a new product team…..and the focus shifted to

product design

THE NEW PRODUCT TEAM(1)

• Claudia Kotcha named as the VP for design innovation

• Jim Stangel appointed as the new CMO and shifted

emphasis to consumer centric marketing approach

THE NEW PRODUCT TEAM(2)

• Aim was to “design the purchasing experience” i.e. “the first

moment of truth”

• P&G design board created on lines of Nike & Mattel

THE NEW PRODUCT TEAM(3)

• Focus laid on Return on MARKETING

INVESTMENT(ROMI)-a technique to evaluate the

effectiveness of marketing strategies)

• Surveys designed, data collected and metrics developed

to measure brand loyalty and customer relationships

CONSUMER FOCUS

“P&G interacts with more than 5 million

customers over 100 countries and conducts more

than 20,000 research studies investing more than

$500 million to execute these studies”

CONSUMER FOCUS

Key research outputs :

• Advocacy(word of mouth) was the most powerful

marketing strategy as observed under VocalPoint

campaign

• Neuromarketing was the new research area identified

ADVERTISING

Media – neutral ideas used

could be translated across

a range of media

In 2011,majority of the

advertising was still done

through television

“A good brand

equity is that in

which both the

consumers and

the organization

feel

inspirational”

LEADERS OF OLYMPIC SPONSORSHIPS

SPONSORSHIPS

P&G has used sponsorships to market

its product very well. It has sponsored

various award shows, games and mega

events across the globe

CELEB ENDORSEMENTS

CELEB ENDORSEMENTS

MARKETING DURING

RECESSION

During 2009,the time of

recession, P&G maintained its

budget for marketing . It

resorted to coupons and in-store

promotional campaigns to lure

in consumers during recession

DIGITAL MARKETING AT P&G

Earliest activities

limited to websites of

brand but it was only

after launch of

pampers.com P&G

was able to provide an

interactive platform….

Beinggirl.com

was P&G’s unique

digital marketing

strategy to

interact with Girls

Mobile marketing became an

integrated part of P&G’s

digital-marketing strategy.

Crest Whitening Plus marked

an entry for P&G in the mobile

marketing place….

Because….

P&G won accolades for its

TV series – “My Black is

beautiful” and this digital

marketing strategy grew its

sales by 20% in first half

of 2010.

P&G’s OLD SPICE CAMPAIGN

P&G’s OLD SPICE CAMPAIGN

Campaign went viral on Youtube

and adding as many as 94,000

followers on twitter marking a

shift for P&G from mass marketer

to one-on-one digitized marketer

SIGNAL…Bringing powerful digital leaders together

SOCIAL MEDIA Campaigns

SOCIAL MEDIA CAMPAIGNS

Brand PHILANTHROPY

Brand Philanthropy

helps in creation of

good image about the

brand as was the case

in TIDE whose sales

got boosted after

Katrina campaign

ANALYSIS OF P&G’s ICONIC BRANDS

IVORY-MARKETING IN A RETRO STYLE

IVORY was the first directly marketed product to consumer by P&G. The soap has seen

different types of marketing – from neo-classical marketing to modern marketing.

TIDE• TIDE was a breakthrough product

and passed several tests including

the risk of P&G brand’s

cannibalization

• The risk of launching the product

two year early bore heavy

returndsin terms of greater market

share.

PAMPERS – brand that created the diaper market

P&G has managed to keep the costs of diapers low while it has

launched “Luvs” diapers for its premium customers…

CREST-The FIRST FLOURIDETOOTHPASTE

P&G worked with American Dental Association

Fluoride toothpastes got generic status in 80s and this made it to slip out of the market

P&G responded to the threats by introducing Crest Whitestrips

ALWAYS

• Always was P&G’s first global brand….Always Infinity

was another remarkable example of P&G’s innovation

SALES

High potential for P&G in developing countries market for growth

SWOT ANALYSIS: STRENGHTS

• Strong focus on R&D

• Strong Brand Portfolio

• Strategic Acquisitions

• Consumer Focus

• Strong Marketing Team

WEAKNESSES

• Increasing

instances of

product recalls

• Poor Website

• Environmental

Issues

OPPORTUNITIES

• Growing Indian FMCG

market

• Expansion especially in

developing markets

• Growing interest of people

in green products

THREATS

• Creation of generic

product might lower

its value

• Change in younger

generation

preferences

• Global economic

conditions

• Intense competition

in industry

•Case Basics

•Situational Analysis

•Marketing Channels

•Marketing Techniques

•SWOT Analysis