3. ‣ a global leader in branded consumer goods
‣ two dozen $1 billion brands known worldwide
‣ pioneered marketing strategies - considered a standard
industry practice
What is P&G?
7. Early marketing campaigns like Ivory,Tide, Crest, Pampers, Always
Pursued international expansion - entered markets in Latin America, Western Europe, Japan
Extended into new lines of businesses through expansions
Innovations round out company’s portfolio - entered new categories
In the 1980s, P&G ramped up global expansion - developed first global brands, Always/
Whisper, Pringles, and Pantene.
In the early 1990s, the U.S.’s top cosmetics company with the acquisition of Noxell and
Max Factor.
Acquisition of Gillette in 2005 made P&G the top consumer goods company
In 2010, P&G’s stated corporate mission to reach “More Consumers, In More Parts of the
World, More Completely.” through continued innovation.
Pushing towards reaching 5 billion consumers
P&G’s 2010 sales hit $78.94 B; net income, $12.74 B; and market capitalization, $186.63 B
9. Sales By Category
Health & Well Being
24%
Beauty & Grooming
31%
Household Care
44%
Sales By Region
Latin America
9%
Central & Eastern Europe, Middle East & Africa
13%
Asia
15%
Western Europe
21%
North America
42%
Situational Analysis - 3/3
11. Understanding the reasons behind P&G’s
massive success in the Consumer Goods
Sector
Using qualitative analysis to evaluate and
compare the outcomes of various
methodologies
Understanding the evolving Marketing
Capabilities & Strategies
15. Innovation and R&D
• P&G marketing’s secret sauce.
• Replaced the trial and error methods
• Took a scientific approach - connected R&D with company’s sales and
marketing
• Crest toothpaste - first toothpaste with fluoride
• Head and Shoulders dandruff shampoo
• Pampers - disposable diapers
16. Innovation and R&D - Connect and Develop
• 50% of innovation and new products to come from P&G’s network of labs,
and 50% through the labs
• Convince the company, stuck in a “not invented here” approach
• R&D organization now included 7,500 inside the firm and 1.5 million
beyond
Objectives
17. • The firm instituted a top-10 needs list, one for each business and one for the company
overall
• Included things such as “reduce wrinkles, improve skin texture and tone” and “create
softer paper products with lower lint and higher wet strength”
• Use of technology game boards
• Network of 70 technology entrepreneurs - located in six connect-and-develop hubs (in
China, India, Japan, Western Europe, Latin America, and the U.S.)
Strategy
Innovation and R&D - Connect and Develop
18. Innovation and R&D - Connect and Develop
• Identified proven technologies, packages, and products that P&G could improve, scale up, and
market on its own or through partnerships
• Swiffer Dusters, Olay Regenerist, Crest Whitestrips, and Crest Spinbrush
• R&D productivity increased by nearly 60%
• The firm’s innovation success doubled
• Drop in cost of innovation.
• R&D investment as a percentage of sales dropped from 4.8% in 2000 to 3.4% in 2006.
Outcome
Originated Outside Firm
Key Elements Discovered Externally
Others
But…
The firm struggled to control costs, and its stock
slid from $118 to $52 over 18 months.
22. Marketing Strategy - Design
Objectives
• To make P&G the top product-design company in the world
• Departure from P&G’s past focus on function, performance, and price
• Not use design as an antidote to its function-driven process but rather as a complement
“We have an innovation process and we
want to make sure that design is plugged
in at the front end” - Lafley
23. Strategy
Marketing Strategy - Design
• “Design Tasting” - featuring design case studies for P&G’s top 200 executives
• P&G design board
• The Clay Street Project
• Lobby of P&G’s Cincinnati headquarters featured a faux home and store so that
employees could physically view and experience the “two moments of truth” every day.
24. Marketing Strategy - Design
Consumer’s use of
product and decision
whether it delivered on it’s
promise
On the store shelf
2
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t
s
o
f
T
r
u
t
h
25. Outcome
Marketing Strategy - Design
The new
emphasis shifted
the company
toward a more
consumer-centric
marketing
approach
27. Consumer-Centric Approach
• More focused attention to in-store promotions such as coupons, displays,
special offers, and other promotional materials
• Pampers’ 2008 campaign
28. Consumer-Centric Approach - Consumer Research
Quantitative
• Blind Tests
• Concept and Use Tests
• Quality monitoring
• Large-scale studies of habits
and practices of regular
customers
Qualitative
• Focus Group Discussions
• Personal Interviews of
customers at home
• In context visits
• In-store interviews
• 20,000 research studies each year
• Invested nearly $500 million into developing and executing these studies
Strategy
29. Consumer-Centric Approach - Consumer Research
• New marketing and promotional opportunities: VocalPoint
• P&G’s word-of-mouth program that enrolled more than 600,000 women to pitch its products
• P&G also gave them samples, coupons, and opportunities to share their opinions with P&G
Outcome
30. Consumer-Centric Approach - Neuromarketing
• Feelings affected decisions and human behavior
• Psychological surveys to measure mood
• Electroencephalography (EEG) technology to measure electrical activity in the brain
as subjects were exposed to commercials
To better understand how its
customers felt—not about a
product such as Pantene, but
about having a “bad hair
day.”
The study found that users of
a new version of Pantene
“reported more joy than those
in the control group.
32. Marketing Mix - Advertising
• Ivory, the first product to be advertised directly to consumers
• Soap operas owed their existence to P&G
• Developing a “media neutral” idea
• Bulk of spending towards television
• Other modes - outdoor displays, mobile devices - Japan VS
• Shift toward more design- and emotion-driven advertising -
transformational approach
33. Marketing Mix - Sponsorships
• P&G, a U.S. Olympic team sponsor for the 2010 Games, became a worldwide sponsor
• National Football League (NFL) sponsorship gave consumers opportunities to engage with the
NFL, “just for choosing P&G brands”
36. Digital Marketing
• P&G’s digital activity had been limited to its operation of brand websites
• Expanded its digital content offering in 1999 with the launch of pampers.com
• Provided information for new and expectant mothers and served as an
interactive forum
• BeingGirl.com, launched in 2000
37. Digital Marketing
• First mobile marketing ad campaign in 2006 to promote
Crest Whitening Plus Scope toothpaste.
• “My Black is Beautiful” products, targeting African
American women, introduced two web series in 2010 to
showcase its products: Buppies and My Black is
Beautiful
P&G’s Old Spice television commercial and YouTube
sensation, “The Man Your Man Could Smell Like”
• Old Spice - 3rd most subscribed channel
• 1.37 million individual views in 3 days
• 94,000 followers on twitter - response campaign
• A milestone
38. Social Media Marketing
• In 2010, P&G began using Facebook as a marketing tool
• Pringles and Old Spice had 9 million and 1.3 million fans
• P&G used Facebook as a marketing supplement, not a replacement
• Manofthehouse.com aimed to “speak to the whole man.”
• Featured household advice for men, including tips on grilling burgers, cleaning toilets, and disciplining
children
39. Building on its
strengths in R&D,
consumer
research, and
product
performance,
P&G continued to
evolve and
innovate as the
world’s largest
marketer.
40. Disclaimer
Created by Kanika Gupta, JIIT Noida during a
Marketing Internship under Prof. Sameer Mathur,
IIM Lucknow
