Procter & Gamble: Marketing Capabilities

Harvard Business School Case

What we offer for you ?

History

P&G Products

Business Goals

The three main focuses…• Maintaining popularity of exiting product• Developing New related product• Innovating and introducing new products from

scratch

Objective

Know about the design, implementation & interpretation of product development & marketing strategies.

Evaluate primary and unique communication strategies and money spending .

Innovation R&D and acquisition .

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.

• CEO- Durk Jager, Introduced a new permeable boundary between P&G Scientists and other non P&G ones.

• In June 1999 under the CEO-Durk Jager, P&G recognized to boost growth after net sales slowed to 2.6% growth from previous year, then P&G cuts 15,000 staff and promised to deliver more innovation

P&G was known for a brand which was based on innovation and continuous improvement throughout the company’s operations and activities, starting with developed or acquired products with performance featured that customer value.

P&G had pursued a multibrand strategy and it managed brands across a category carefully, with each getting individual support and satisfying a segment of the market.

Marketing strategy

 Procter and gamble have the highest ranking in the world’s consumer good production means that they are at the top marketers in the world.

They are strongly incorporated with the best sellers across the world especially in US.

The strategies made by the management are highly appreciated because of strong managerial functions.

Different types of innovations in the product are taken into functionality, which is liked by the customers.

The services of the company are paid across the world.

Commitment to Customers

P &G invested more in market research than any company in the world, interacting with more than 5 million consumers in almost 100 countries.

The firm conducted over 20,000 research studies each year, and invested nearly $ 500 million into developing and executing these studies.

It ran focus group discussion, interviewed consumer at home, and performed in-context visits and in-store interviews.

Neuro marketing which helped in one to one relationship with customers.

Campaign like “ Thank you mom” and Loads of hope acted as means of emotional branding .

Advertising

• The first company who advertised its product directly to consumers using dramas, TV commercials.

• To compete in less familiar market, it developed “media neutral” idea that could be advertised in regional local languages.

• P&G marketing had been built around the idea that functionality would sell over emotional connection, However the strong connection to functionality and benefits remained central to P&G advertising, Lefley, Stengel, and Kotchka aimed to shift P&G towards more design and emotion driven advertising.

P&G sponsored U.S Olympic team in 2010, became a world wide sponsor, specially to raise its visibility in emerging markets for the 2012 winters games held in Russia and 2016 summer game in Brazil.

A national Football League (NFL) sponsorships 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 hours a day.

Celebrity Endorsement

• P&G endorsed many celebrities and many spokespersons for its acquired beauty companies like CoverGirl spokespersons Christie Brinkley, Drew Barrymore, Ellen DeGeneres, and Queen Latifah.

• Tennis star Roger Federer was featured in Gillette Fusion Products ads in the U.K in 2010.

• Television show Modern Family actress Sofia Vergara was named spokesmodel for CoverGirl cosmetic in May 2011 for an ad campaign launching in January 2012.

• Taylor Swift also joined the company for the CoverGirl.

• Eva Mendes and Naomi Watts were announced as new spokesmodels for Pantene shampoo in spring of 2011.

Marketing Spending

During recession in 2009 CEO Lafley announced that despite the poor economic climate, P&G would maintain its marketing budget. P&G shifted to coupons and in-store promotional activities to maintain the same media presence while shifting ad cost.

In 2010 P&G increased ad spending by $1 billion, with a 20% increased in media impression

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

The Digital marketing of P&G started with launching of pampers.com in 1999, the website contained product information similar to other brand website under P&G. By 2007 the site was translated for 49 countries.

BeingGirl.com, launched in 2000, provided information and expert advice on “issues that teenage girl might be too embarrassed to ask a parent or doctor about, such as menstruation, eating disorders, acne and dating, the advertised P&G tampons and offer free samples.

P&G launched its first mobile marketing ad campaign in 2006 to promote Crest Whitening Plus Scope toothpaste.

P&G lines of “My Black is Beautiful ” products, targeting African women, introduced two web series in 2010 to showcase its products

P&G Old Spice television commercial and YouTube sensation “ The Man Could Smell Like “ gave P&G its greatest exposure in the online community in 2010, and bridge power of digital and social media .

Social Media

• 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.

• One blog noted that watching P&G’s online Serial “ Sunset Heat” promoting Escada perfume was “ more painful than reading Ulysses at beach.

• In 2010, P&G began using Facebook as a marketing tool and, by 2011, had 15 brands with “friends” in the six-figure range.

Interactive Community Promotion

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 to promote Charmin toilet paper, and tourist loved it. The times square campaign created nine YouTube ad and generated 20 million views per month.

P &G used T- shirt having slogans and endorsed celebrities like Katrina kaif to promote sale of its product like Tide.

P&G continued to push towards reaching 5 billion consumers served worldwide, its evolving marketing capabilities took center stage.

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.

Created by Bijendra Kumar Ray of NIT Hamirpur ,during a Marketing internship by Prof. Sameer Mathur, IIM Lucknow