2. PROCTER AND GAMBLE
GLOBAL LEADER IN BRANDED CONSUMER
GOODS, KNOWN FOR ICONIC CATEGORY
DEFINING PRODUCTS SUCH AS IVORY
SOAP, CREST TOOTHPASTE, AND TIDE
DETERGENT LAUNDRY. THE COMPANY
OWNS AND CONTROLS OVER TWO DOZEN
$1 BILLION BRANDS WORLDWIDE.
3. COMPANY BACKGROUND
P&G PURSUED INTERNATIONAL EXPANSION AS EARLY AS THE 1930S, AND FROM
1945 TO 1980 IT BEGAN TO
ENTER MARKETS IN LATIN AMERICA, WESTERN EUROPE, AND JAPAN. IT EXPANDED
INTO NEW LINES OF BUSINESS THROUGH ACQUISITIONS, SUCH AS CHARMIN PAPER
MILL (1957), WHICH OPENED UP THE HOUSEHOLD PAPER PRODUCTS MARKET
(TOILET PAPER, PAPER TOWELS) FOR THE COMPANY, AND FOLGERS COFFEE (1963),
GIVING P&G A PRESENCE IN THE FOOD CATEGORY. INNOVATIONS HELPED ROUND
OUT THE COMPANY’S PORTFOLIO: DISPOSABLE DIAPERS (PAMPERS), FIRST MARKET-
TESTED IN THE EARLY 1960S, CREATED A NEW CATEGORY; LIQUID FABRIC
SOFTENERS (DOWNY) AND FABRIC SOFTENER SHEETS (BOUNCE) LED THOSE NEW
POPULAR CATEGORIES. P&G ALSO
DIVESTED BRANDS THAT NO LONGER FIT THE COMPANY’S OVERALL PORTFOLIO.
4. INNOVATION AND R&D
IN 1887, A NEPHEW OF ONE OF P&G’S FOUNDERS, WHO HAD A CHEMISTRY DEGREE,
SET UP AN ANALYTICAL LAB
FOR THE COMPANY, LAYING THE FOUNDATION FOR A PROFESSIONAL R&D DIVISION
AND ESTABLISHING ONE OF THE
FIRST CORPORATE LABS IN THE FIELD OF CONSUMER GOODS.12 REPLACING THE
TRIAL-AND-ERROR METHODS COMMONLY
PURSUED AT THE TIME, P&G TOOK A SCIENTIFIC APPROACH AND CONNECTED R&D
WITH THE COMPANY’S SALES
AND MARKETING.13 FIRST-TIME PRODUCTS INCLUDED CREST TOOTHPASTE (1955),
THE FIRST TOOTHPASTE WITH
FLUORIDE; HEAD & SHOULDERS DANDRUFF SHAMPOO; AND PAMPERS DISPOSABLE
DIAPERS (1961).
5. MARKETING AT P&G
BRANDS LAY AT THE HEART OF P&G’S SUCCESS, AND AS ONE
OBSERVER WROTE, “ON THEIR OWN, MOST BIGGEST BRANDS ARE
CATEGORY KILLERS RUN BY INDUSTRY LEADERS WITH SEEMINGLY
ENDLESS RESOURCES AT THEIR DISPOSAL TO EXPLOIT UNMET
CONSUMER NEEDS TO DRIVE CATEGORY GROWTH AND MARKET
SHARE EXPANSION.” AND WHILE ADVERTISING PLAYED A BIG ROLE IN
THIS SUCCESS, ANOTHER OBSERVER NOTED, “P&G RECOGNIZED THAT
BUILDING BRANDS IS NOT EXCLUSIVELY OR EVEN PRIMARILY A
MARKETING ACTIVITY. RATHER IT IS A SYSTEMS PROBLEM. BETTER
BRANDS ARE BASED ON INNOVATION AND CONTINUOUS
IMPROVEMENT THROUGHOUT THE COMPANY’S OPERATIONS AND
ACTIVITIES, STARTING WITH DEVELOPED OR ACQUIRED PRODUCTS
WITH
PERFORMANCE FEATURES THAT CONSUMERS VALUE.” ANOTHER
OBSERVER NOTED THAT “STEADILY LOWERING THE COSTS OF
6. COMMITMENT TO
CUSTOMER
P&G HAD A LONG HISTORY OF RIGOROUS PRODUCT AND MARKET
TESTING; THE FIRM WAS WELL KNOWN AS ESPECIALLY PROCESS-
ORIENTED. P&G INVESTED MORE IN MARKET RESEARCH THAN ANY
COMPANY IN THE WORLD, INTERACTING WITH MORE THAN 5
MILLION CONSUMERS IN ALMOST 100 COUNTRIES.38 THE FIRM
CONDUCTED OVER 20,000 RESEARCH STUDIES EACH YEAR, AND
INVESTED NEARLY $500 MILLION INTO DEVELOPING AND EXECUTING
THESE STUDIES. P&G TOOK ON CONSUMER RESEARCH THROUGH
VARIOUS RESEARCH METHODS.
7. ADVERTISING
P&G HAD BEEN A MARKETING TRAILBLAZER FROM THE OUTSET: IVORY, THE
FIRST PRODUCT TO BE ADVERTISED DIRECTLY TO CONSUMERS, SUBVERTED
A TRADITIONAL RELIANCE ON AN ESTABLISHED NETWORK OF
WHOLESALERS, DISTRIBUTORS, AND RETAILERS AND SOLD DIRECTLY TO
CONSUMERS INSTEAD. OTHER BRANDS SUCH AS CRISCO, CAMAY, AND
OXYDOL SOON FOLLOWED. EARLY INNOVATIONS INCLUDED SPONSORSHIP
OF DAYTIME RADIO DRAMAS (1932) AND TELEVISION COMMERCIALS (FIRST
AIRED IN 1939). SOAP OPERAS OWED THEIR EXISTENCE TO P&G: THE
DAYTIME DRAMA AS THE WORLD TURNS WAS LAUNCHED IN 1956 TO
SPECIFICALLY TARGET WOMEN IN THEIR HOMES. ANOTHER WORLD, THE
YOUNG AND THE RESTLESS, AND GUIDING LIGHT WERE OTHER LONGTIME
P&G-SPONSORED DAYTIME DRAMAS. WHILE P&G CONSTANTLY BUILT ON ITS
EXPERIENCE WITH BROADCAST MEDIA, IT ALSO RELIED HEAVILY ON
DEVELOPING LONG-STANDING PARTNERSHIPS WITH ADVERTISING AGENCIES
TO DEVELOP ROBUST BRAND IDENTITIES FOR ITS PORTFOLIO OF CONSUMER
GOODS.
8. SPONSORSHIP
A RANGE OF SPONSORSHIP OPPORTUNITIES WERE LEVERAGED
ACROSS P&G’S PORTFOLIO AS WELL. FOR EXAMPLE, P&G, A U.S.
OLYMPIC TEAM SPONSOR FOR THE 2010 GAMES, BECAME A
WORLDWIDE SPONSOR, SPECIFICALLY TO RAISE ITS VISIBILITY IN
EMERGING MARKETS, FOR THE 2012 WINTER GAMES TO BE HELD IN
RUSSIA AND THE 2016 SUMMER GAMES IN BRAZIL.55 A NATIONAL
FOOTBALL LEAGUE (NFL) SPONSORSHIP GAVE CONSUMERS
OPPORTUNITIES TO ENGAGE WITH THE NFL, “JUST FOR CHOOSING
P&G BRANDS,” AND TIED IN WITH THE NFL’S PLAY 60 INITIATIVE, A
NATIONAL YOUTH HEALTH AND FITNESS CAMPAIGN FOCUSED ON
FIGHTING CHILDHOOD OBESITY AND INCREASING WELLNESS BY
ENCOURAGING YOUTHS TO BE ACTIVE AN HOUR A DAY.
9. CELEBRITY ENDORSEMENTS
P&G’S ACQUISITIONS OF SEVERAL BEAUTY COMPANIES IN THE 1990S
HAD BROUGHT A NUMBER OF CELEBRITY ENDORSERS INTO THE P&G
STABLE, INCLUDING COVERGIRL SPOKESPERSONS CHRISTIE BRINKLEY,
DREW BARRYMORE, ELLEN DEGENERES, AND QUEEN LATIFAH. P&G
ALSO DEVELOPED NUMEROUS CELEBRITY ENDORSEMENTS. MOST
RECENTLY, TELEVISION SHOW MODERN FAMILY ACTRESS SOFIA
VERGARA WAS NAMED SPOKESMODEL FOR COVERGIRL COSMETICS IN
MAY 2011 FOR AN AD CAMPAIGN LAUNCHING IN JANUARY 2012.
TAYLOR SWIFT ALSO JOINED THE COMPANY FOR THE COVERGIRL
BRAND.57 EVA MENDES AND NAOMI WATTS WERE ANNOUNCED AS
NEW SPOKESMODELS FOR PANTENE SHAMPOO IN THE SPRING OF
2011. OTHER PANTENE SPOKESPERSONS INCLUDED GISELE
BÜNDCHEN, STACY LONDON, AND TERI HATCHER.
10. MEDIA SPENDING
IN EARLY 2009, AS THE RECESSION TOOK HOLD, THEN-CEO LAFLEY
ANNOUNCED THAT DESPITE THE POOR ECONOMIC CLIMATE, P&G
WOULD MAINTAIN ITS MARKETING BUDGET. THOUGH THE FIRM’S
MARKETING BUDGET WAS NOT DIRECTLY CUT, P&G SHIFTED TO
COUPONS AND IN-STORE PROMOTIONAL ACTIVITIES TO MAINTAIN
THE SAME MEDIA PRESENCE, WHILE SHIFTING AD COSTS.63 IN 2010,
P&G INCREASED AD SPENDING BY $1 BILLION, WITH A 20% INCREASE
IN MEDIA IMPRESSIONS;64 HIGHER REVENUES LED TO AN INCREASE IN
DOLLARS SPENT. MCDONALD, WHO BECAME CEO IN 2010, STATED
THAT P&G WOULD MAINTAIN THE SAME LEVEL OF SPENDING, WHILE
SHIFTING DOLLARS TO DIGITAL ADVERTISING AND OTHER NEW
MEDIA TO BROADEN THE AUDIENCE.
11. DIGITAL MARKETING
THROUGHOUT THE 1990S, P&G’S DIGITAL ACTIVITY HAD BEEN
LIMITED TO ITS OPERATION OF BRAND WEBSITES, BUT THE FIRM
EXPANDED ITS DIGITAL CONTENT OFFERING IN 1999 WITH THE
LAUNCH OF PAMPERS.COM. THE WEBSITE CONTAINED PRODUCT
INFORMATION, SIMILAR TO THE OTHER BRAND WEBSITES UNDER P&G,
BUT ALSO PROVIDED INFORMATION FOR NEW AND EXPECTANT
MOTHERS AND SERVED AS AN INTERACTIVE FORUM. BY 2007, THE
SITE WAS TRANSLATED FOR 49 COUNTRIES.66 BEINGGIRL.COM,
LAUNCHED IN 2000, PROVIDED INFORMATION AND EXPERT ADVICE
ON “ISSUES THAT TEENAGE GIRLS MIGHT BE TOO EMBARRASSED TO
ASK A PARENT OR DOCTOR ABOUT, SUCH AS MENSTRUATION,
EATING DISORDERS, ACNE AND DATING.”
12. SOCIAL MEDIA
THE COMMUNITY THAT PAMPERS.COM HAD BUILT FOR P&G LED IT TO
EXPERIMENT WITH ADDITIONAL SOCIAL MEDIA FORAYS. IN 2007, P&G
LAUNCHED TWO SOCIAL MEDIA SITES: CAPESSA FOR WOMEN ON
YAHOO! HEALTH AND THE PEOPLE’S CHOICE COMMUNITY,
ASSOCIATED WITH THE PEOPLE’S CHOICE AWARDS. HOWEVER, WITH
THE BENEFITS OF SOCIAL MEDIA CAME RISKS. ALONG WITH ITS
SUCCESSES, P&G GARNERED ITS SHARE OF NEGATIVE CONSUMER
REACTIONS TO ITS ADS. ONE BLOG NOTED THAT WATCHING P&G’S
ONLINE SERIAL “SUNSET HEAT” PROMOTING ESCADA PERFUME WAS
“MORE PAINFUL THAN READING ULYSSES AT THE BEACH.”
13. INTERACTIVE COMMUNITY
PROMOTION
IN 2005, TIDE LAUNDRY DETERGENT HAD ITS BEST SALES IN OVER A DECADE AFTER A
HIGHLY SUCCESSFUL POST KATRINA CAMPAIGN, “LOADS OF HOPE.” TIDE OPENED A
LAUNDROMAT IN NEW ORLEANS TO WASH SURVIVORS’ CLOTHES AND SOLD T-SHIRTS
WITH VARIOUS SLOGANS SUCH AS, “BE SEEN, NOT SPOTTED,” WORN BY CELEBRITIES TO
PROMOTE TIDE WITH FEBREZE. THE T-SHIRTS COULD BE PURCHASED ONLINE, AND ALL
PROCEEDS WENT TOWARD FAMILIES AFFECTED BY THE HURRICANE.82 IN 2006, P&G
UNVEILED A MAJOR CAMPAIGN IN TIMES SQUARE TARGETING HOLIDAY SHOPPERS. A
LARGE BLUE NEON SIGN IN THE MIDDLE OF A BROADWAY BLOCK READ “RESTROOMS”
AND LED PEOPLE UP AN ESCALATOR INTO A LOUNGE WITH FLAT-SCREEN TVS, LEATHER
COUCHES, A FIREPLACE, AND 20 SHINY, SPOTLESS TOILETS. THE AD WAS USED TO
PROMOTE CHARMIN TOILET PAPER, AND TOURISTS LOVED IT. THE TIMES SQUARE
CAMPAIGN CREATED NINE YOUTUBE ADS AND GENERATED 20 MILLION VIEWS PER
MONTH. MOST VIEWERS WERE UNDER 30, THE “HOLY GRAIL” AUDIENCE FOR MARKETERS
AIMING TO ATTRACT CUSTOMERS FOR LIFE.
14. MOVING FORWARD
AS P&G CONTINUED TO PUSH TOWARD REACHING 5 BILLION
CONSUMERS SERVED WORLDWIDE, ITS EVOLVING MARKETING
CAPABILITIES TOOK CENTER STAGE. THE FIRM HAD PROVEN ITS
ABILITY TO NAVIGATE THE DIGITAL ENVIRONMENT WITH EFFORTS
LIKE “THE MAN YOUR MAN COULD SMELL LIKE” AND
MANOFTHEHOUSE.COM, HAD INCORPORATED A SENSE OF DESIGN
INTO ITS CULTURE, AND AIMED TO COMPLEMENT ITS STRONG
FUNCTION-DRIVEN MARKETING BACKGROUND BY ADDING
EMOTIONAL EFFORTS SUCH AS THE “THANK YOU, MOM” AND “LOADS
OF HOPE” CAMPAIGNS. 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.
16. IVORY SOAP
P&G EXPERIMENTED WITH SEVERAL NOW-CLASSIC MARKETING TOOLS IN ITS
EFFORTS TO PROMOTE AND MARKET IVORY SOAP, THE FIRST PRODUCT TO BE
MARKETED DIRECTLY TO CONSUMERS. P&G RELIED HEAVILY ON MAGAZINE
ADVERTISING FOCUSED ON A CLEAR MESSAGE OF IVORY’S PURITY (99 AND
44/100THS% PURE). THE COMPANY ALSO RELIED ON DIRECT MARKETING THROUGH
MASS MAILINGS ENCLOSING SAMPLES OF IVORY, ALONG WITH A BOOKLET
COMPILING THE BRAND’S EARLY PRINT ADVERTISEMENTS. THESE WERE FOLLOWED
UP WITH A LETTER, SENT TO WOMEN, AIMED AT MAKING THEM “PATRONESSES” FOR
IVORY. THE LETTER “REMINDED RECIPIENTS OF IVORY’S PURITY, WARNED AGAINST
‘COUNTERFEITS,’ ENCLOSED TESTIMONIALS FROM ‘THE MOST EMINENT MEN IN
THEIR PROFESSION IN THE COUNTRY,’ AND URGED WOULD-BE ‘PATRONESSES’ TO
DEMAND IVORY SPECIFICALLY WHEN SHOPPING FOR SOAP AND TO REJECT ANY
SUBSTITUTES OFFERED BY THEIR GROCERS.
17. Originally developed during the height of World War II,
Tide (called Product X) was not just a new soap, but a
new synthetic formula for a detergent—a breakthrough
product. Getting the new product to market before
Lever or Colgate could launch their own versions meant
forgoing P&G’s tried-and-true product development
process, essentially skipping blind tests in several
markets, analyzing data, reformulating on the basis of
the test results, retesting, trying out advertising
strategies, polling consumers, running shipping tests,
18. PAMPERS
A blockbuster brand that almost single-handedly
created the disposable diaper category for the mass
market, Pampers evolved out of P&G’s experiments in
expanding its paper products line in the 1950s.
Demographic trends, such as the postwar baby boom,
made it clear disposable diapers would find a huge
market. But P&G had no indication that disposable
diapers would replace cloth, only predicting that about
6% to 7% of cloth users would switch to disposables.
19. CREST
The first toothpaste with fluoride, Crest was also a category-
defining product that had gained iconic status along with P&G’s
other household names. As the product (and others with
fluoride) improved dental health, P&G worked with professional
organizations such as the American Dental Association to
persuade dentists that their lucrative restorative services, which
were in decline due to improved dental health, could be offset by
preventative care. However, Crest’s success also helped ensure
the generic status of fluoride toothpaste, and in the 1980s, Crest
slipped in the market as baking soda and whitening additives
bolstered competitors’ offerings. P&G responded to these market
threats by expanding Crest’s brand franchise beyond toothpaste,
with Crest Whitestrips and, through an acquisition, the
20. ALWAYS
Always sanitary pads, launched in 1984, became P&G’s first truly
global product. P&G’s Always brand was behind some of the
biggest innovations in feminine hygiene history, including the
introduction of winged pads in 1985 and ultra-thin pads in
1990. P&G introduced Always Infinity, a pad made with a newly
invented material that enabled women to have the “magical
combination of absorbency, amazing softness, and flexibility all
in one pad.” As a global brand, P&G adapted Always (in size and
shape) to appeal to women across the globe, and in some
international markets, it was the first feminine hygiene product
ever marketed to consumers.
