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P&G'sMarketingStrategiesIntroductionTheProcter&GambleCompany(P&G)isanAmericanmultinationallconsumergoodscompanyheadquarteredindowntownCincinnati,Ohio,USA.Itsproductsincludefoods,beverages,cleaningagentsandpersonalcareproducts.Productsmix,diversebrands—differentbrandsaimatdifferenttargetcostomers.Somebrands:Olay,Joyce,Safeguard,PanteneMostofthesebrands—includingBounty,CrestandTide—areglobalproductsavailableonseveralcontinents.Procter&GambleproductsareavailableinNorthAmerica,LatinAmerica,Europe,theMiddleEast,Africa,Asia,AustraliaandNewZealandPurpose
"Wewillprovidebrandedproductsandservicesofsuperiorqualityandvaluethatimprovethelivesoftheworld’sconsumers,nowandforgenerationstocome.Asaresult,consumerswillrewarduswithleadershipsales,profitandvaluecreation,allowingourpeople,ourshareholdersandthecommunitiesinwhichweliveandworktoprosper."AsP&G’sPurposeStatement,itarticulatesacommongoalthatinspirestheiremployeeseveryday.CoreStrengthsInordertowinintheconsumerproductsindustry,P&Gfocusesonfivecorestrengths,including:consumerunderstanding,
innovation,
brand-building,
go-to-marketcapabilitiesandscale.Inordertounderstandtheconsumers,P&Gdonotcovertheunarticulatedneedsofconsumers,andtranslatesconsumerdesiresintonewproducts,whichistheso-calledinnovation.Atthesametime,P&Gshapespurpose-inspiredandbenefit-drivenbrand,whichcanmeettheircustomers’needs.Withthefamousbrands,itreachesretailersandconsumersattherightplaceandtherighttimeandgetsthescalewhichdrivesefficiencyandconsumervalueGlobalStructure&Operations
Inordertooffertheglobalscalewhichcanbenefitstheinternationalcompany,P&Gbuildsupauniqueorganizationalstructureandfocusesontherelevantconsumersinroughly180countrieswheretheirbrandsaresold.WiththeframeworkwhichP&G’scorporatestructureprovides,P&Ggetsthebenefitsofaglobalorganizationwithspeedaswellasefficiency.Theglobaloperationskeepitintouchwiththelocalcommunities.Atthesametime,thecompany’sstronggovernancepracticesmakesurethattheycanconducttheiroperationswithconsistentlyhighstandardsandintegrity.Targetmarket
Withsomanycleaningproducts,femininehygiene,personalandbeautycare,babyandfamily,andpetnutritionandcareproducts,thetargetmarketsseemtopointtostay-at-homeparents,morespecificallymotherswithchildren.AsfortheproductssoldatProctorandGamble,ProctorandGamblenaturallytargetsthosewhoownhomes.TheseindividualsaretheonesthataremostlikelytouseandneedtheP&G.SocialResponsibility
Formorethan172years,P&Gbrandsandpeoplehavetouchedandimprovedconsumers’livesasbestastheycan.Thiscommitmentextendstotheirsocialinvestments."P&GbrandsandpeopleareP&Ggreatestassets,andtogether,theyareatremendousandindispensableforcethatcanmakeanimpactthatmatters."
ThroughP&G’sLive,LearnandThrivecause,theyarehelpingchildreninneedaroundtheworldgethealthybodiesandsuitableenvironment,receivehighqualityeducationandbuildskillsfortheirfuturelife.Now,“LearnmoreaboutLive,LearnandThrive”isP&G’smaximofsocialresponsibility.MarketingStrategiesProducts:
Forpast172years,withsomanycleaningproducts,femininehygiene,personalandbeautycare,babyandfamilyandpetnutritionandcareproducts,P&Ghasbeenprovidingtheirreliablebrandsinordertoproveeverydayalittlebetterfortheconsumersallovertheworld.With23famousbrandswhichhavemorethan$1billioninannualsales,andanother20brandsgeneratingabout$500millionormoreeveryyear,P&Ghasthelargestlineupofleadingbrandsinitsindustry,“These43brandshavedelivereda9-yearcompoundaveragesalesgrowthrateofabout10%—doublethegrowthrateofthebalanceofP&G’sbrandportfolio”.[2009annualreportofP&G]PriceTheobjectivewhichP&Gwantstomeetisgettingmoremarketsharebyitsmanysub-brands.In2007,Unileverpromotesnewproduct----Clearshampoo,whichhasthesamefunctionandtargetcustomerswithP&G’sstarproduct----Head&Shoulders.Thus,P&GdeclineditspriceofHead&Shouldersinordertocopewithabove-mentionedchallenge.AfterUnileverpromotednewproducts,P&Ggave200mlpackageshampoowhencustomersbuy400mlshampoos.Inaddition,P&Gincreasesthepublicityscale.Fourmonthslater,thenewproductofHead&Shouldersgainsalotofpraisebecauseofitslowpriceandpackage.P&Gwinmoremarketsharebyitspricingstrategy.Inthiscase,P&G’sgoalistakingmoremarketshare.Whentheysucceed,P&Graisedtheirproducts’pricebacktotheirlevelbeforestepbystep.Before1990-----thegoldentimeofP&G,thereisnocompetitorintheChinesemarket,theneedsofcustomersarehuge.SoitwasaperfecttimeforP&Gtoapplypriceskimming,whichmeanssettinganinitialhighpricetocovernewproductcostsandgenerateaprofit.P&Ghadhighprofitsatthattimeanduseditshighpricestosetupanimpressionofhigh-endbrands.However,afterthemid1990s,P&Gencounteredmorecompetitors,duetoseverallocalbrandssetupinchina,itsstrongcompetitor-----Unileveralsocametochinabylowerprices.Inordertodealwiththoseconditions,P&Gdecreaseditsproducts'prices,becauseChineseconsumerswereverysensitivetoprices.Duringthisperiodoftime,thecompanyusedCompetitorbasedpricingmethodtogainitsmarketsharePriceP&G’ssignificantPricingtacticsaredefiningdifferentpricesfordifferentbrandstosatisfydifferentcustomers.P&G’ssub-brandincludesRejoice,whichissold9.9Yuan,aimingtomeetthecustomerswhodon’twanttospendtoomuchmoneyonshampoo.Pantene,asub-brandemphasizestheprotectionofhair,itspriceis16.9Yuaninaverage.So,thebrandtargetcustomersarethepersonwhowantstospendalittlemoremoneytotakegoodcareoftheirhair.Withthedevelopingofcustomers’need,Pantenesegmentitsproductsagaintheseyears.IncludingSassoonandClairol,P&G’sproductpricesrangedfrom9.9Yuantomorethan60Yuan.Nomatterhowmuchmoneythecustomerswanttospendonhaircareshampoos,P&G’sproductscanalwayssatisfycustomers’needs.ItistheP&G’scorepricetacticwhichisbetterthanothercompetitors.Also,thereisanodd-evenpricetheory,becausecustomersregardpricesof10Yuanassignificantlyhigherthan9.9Yuan.Inaddition,P&Galwayshasgreatdiscountssuchasbuyingalargeonegetasmalloneforfreeatholidays.Thosemethodsarealwaysworking.[Business,RickyW,GRIFFIN&RonaldJ.EBERT]PricePlaceDistributionproblemsDuringtheseyears,P&Ghassomedistributionproblemsduetothechangesinretailchains.Afteraseriesofmarketingresearch,P&Gfoundthattheirretailerslose11%ofsalesbecauseofout-of-stocks,andthatsubstitutionswonbacklessthan25%ofamanufacturer’slostsales.[MariaJimenez,DerekPrior,2002].ThiswouldabsolutelybebanefulforbothP&Ganditsdistributors.Thementionedretailchanges,whichintriguedbytheincreasingdemands,definitelyputsomepressureonP&G’ssupplychains.Theorigindistributionchannelscouldnotsatisfyitsstakeholders’needsandspecificwants.Thefollowingtwoimportantreasonsdirectlyleadtothepressuresonretailchains.Currently,consumershavehighexpectationtoagreaterassortmentofproductoptions,say,differentbrands,functions,shapesandsmellsofhaircareproducts.Thus,theretailersofP&Gneedtodriveuptheirservicelevelexpectationsanddiversityofconsumerproducts,whichbecomingthefirstreason.Also,cashrequirements,fromretailers,createshugepressureonshorterorder-to-deliverycyclesandthenewflow-throughdistributionnetworksrecentlyraisedquickly.NewdistributionstrategiesAsamajorconsumerpackagedgoodsmanufacturers,P&G’smostcompetitiveretailchainintheworldseemsnotsoeffectiveanymore.“FromChicagotoCaracas,BrusselstoBeijing,P&G'sproductdevelopersandmarketersmustunderstandconsumerneedsbetterthanitscompetitors.”[Ciscosuccessstorystoriescustomerprofile-P&G]Aninnovativeengineshouldbequicklyusedtoconnectconsumers’demandswithP&G’snewproductsandnewsolutionsforbuildingnewbrands,moreover,makingthevariety.ThefastspeedcanhelpP&Gtotallydiffersfromlaggards.So,thecompanyfoundsomenewwaystofixitsmarketsharelostproblemandhelpitsretailersregaintheirsales.Firstly,P&GcooperatedwithCiscoCorporation,setupadigitalworldbyreinvestingitsmarketing.Duetotheinternetepochin21stcentury,inaword,P&Gembracestheinflectionprovidedbythenewdigitalsystem.OnJanuary14th,2010,the“Estore”ofP&Gwastestedandwouldabsolutelyimpactsomeofitsbiggestcustomers,majortraditionalandonlineretailersdirectly.This“l(fā)ab”testingprogramisseenasaventureforaconsumerproductsmanufacturer,butcouldalsopromoteforitsretailersandadvertiseitsspecialoffertothecustomers.[P&GJumpingIntoRetailOnline,TestingNewSite]Secondly,P&Goptimizedoutboundtransportationbychanginga“multimodal”fashion,usingmultipleformsoftransportinto“intermodal”transportation,whichusesshippingcontainersthattransfersmoothlyfromonemodetoanother.Bymeansofintermodalapproachprocess,whichhelpsgoodsshiftingawayfromtrucksandplanestoboatsandtrains,P&Galsosavesfuelandestablishesenvironment-friendlytransportationsystem.Thirdly,P&Gimplementsitssupplierdiversityprogram,whichmeansthatthecompany’sconsumers,customersandsuppliersbecomemorediverseandchangetheirneedseveryday.Theprogramdependingonunderstandingtheirworkefficiencyandneedssolvetheout-of-stocksproblemsandreleasethepressureonsupplychains.Thecompanycollaboratescloselywithitssuppliersacrosstheentiresupplychainandkeepsthesustainabilitybyguidingthedevelopingofrelationshipswithsuppliers.“We'rechangingouroverallapproachtosupplychainmanagementtobecomeevenmoreconsumercentric.”saidMikePower,President,andGlobalBusinessServices.Therightproductattherighttimeattherightplacewillsignificantlygainsalesvolumeandmarketshareofthecompany.Thecloserelationshipscouldavoidstocksproblemsandhelpmoreontimedelivery,moredesirableproductsandmoresatisfiedconsumers.PromotionAsoneofthemostsuccessfulcompaniesintheworldwhichdidanexcellentjobinpromotingtheirproductsandaverityofbrands,P&Ghavetheirownuniqueandsuitablepromotionstrategysystem.Combinedwithdifferentformsofpromotion,P&GmakemorecustomersandpotentialcustomersknowitsnameandthosebrandsbelongtoP&G,notonlyinUSmarket,butalsointernationalmarketinawhole.JustliketheotherTop500enterprisesdid,P&Grangedahugenumberofmoneyinpromotingtheirproducts,thefirstmethodisdoingadvertisement,involvingTV,magazines,SubwayandsomeothermediasAds.AfterahardworkbyP&GmarketinggroupforseveraldecadesandbasedonalotofcreativeAdsideasandposters,manyclassicandfreshcharactersthatrepresentP&Ghavebeenrememberedbytheworldwidecustomers.Forinstance,thelivelyandbravesuperstarappearedintheSafeguardtoiletsoapAds.TheyoungboyhelpP&GattractalotofChineseconsumerstobuytheirproducts
Basedonthehelpofhighspeedinformationtransportationbynetwork,P&Gismuchmoreconvenienttopromoteitsproducts.Theefficiency
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