TOUC HIN G LI VES, IMP RO VING LIFE… .

PROC TER & GAMBLE

 FACTFILE
 Founded – 1837 *(American multinational corporation)
 Headquarters - Cincinnati, Ohio, USA
 Key people - A. G. Lafley, Chairman, President, and
Chief Executive.
 Industry - Consumer goods
 Revenue - US$ 83.503 billion (2008)
 Net income - US$12.075 billion (2008)
 Employees - 138,000
 Website - www.pg.com
 Products are available in 140 countries
 RANKS ACHIEVED
 8th largest corporation in the world by market
capitalization. (2008)
 14th largest US company by profit.
 10th in Fortune's Most Admired Companies list (as of
2007).
 P&G was named 2008 Advertiser of the Year by Cannes
International Advertising Festival spending $2.62 billion
 Awarded inaugural social innovation award by the
financial times.
 Ranked 2nd in the chief executive magazine’s “best
companies for leaders”.
 In October 2008, P&G was named one of "
Canada's Top 100 Employers" by Mediacorp Canada
Inc.,
 PAST
 William Procter, a candlemaker, and James Gamble, a
soapmaker, immigrants from England and Ireland,
respectively, who had settled earlier in Cincinnati, who
met as they both married sisters, Olivia and Elizabeth
Norris formed the company initially.
 Alexander Norris, their father-in law called a meeting in
which he convinced his new sons-in-law to become
business
partners.
 On October 31, 1837, as
a result of the suggestion,
Procter & Gamble was born.
 OPERATIONS
Effective July 1, 2007, the company's operations are
categorized into three "Global Business Units" with each
Global Business Unit divided into "Business Segments,"
according to the company's June 2007 earnings release.
 Beauty Care
– Beauty segment
– Grooming segment
 Household Care
– Baby Care and Family Care segment
– Fabric Care and Home Care segment
 Health & Well-Being
– Health Care
– Snacks, Coffee and Pet Care
 Twenty-four of P&G's brands
have more than a billion dollars
in net annual sales and another
18 have sales between $500 million
 MANUFACTURING
Procter & Gamble manufactures its products
across the globe. Manufacturing operations are
based in the following regions:
 United States
 Canada
 Latin America
 Europe
 China (31 wholly-owned
factories) and other parts
of Asia
 Africa
 Australia
 PRODUCTIONS
Procter & Gamble produced and sponsored the first radio soap operas in the
1930s.
 Past serials produced by Procter & Gamble include:
 Another World
 Lovers and Friends
 The Brighter Day
 The Catli
 Our Private World
 The Edge of Night
 The First Hundred Years
 For Richer, for Poorer
 From These Roots
 Search for Tomorrow
 Somerset
 Texas
 Young Doctor Malone
 EXPANSION
 During the American Civil War, the company won contracts to
supply the Union Army with soap and candles. In addition to the
increased profits experienced during the war, the military contracts
introduced soldiers from all over the country to Procter & Gamble's
products.
 In the 1880s, Procter & Gamble began to market a new product, an
inexpensive soap that floats in water. The company called the soap
Ivory.
 The company began to build factories in other locations in the
United States
 The company introduced "Tide" laundry detergent in 1946 and "Prell
" shampoo in 1950.
 In 1955, Procter & Gamble began selling the first toothpaste to
contain fluoride, known as "Crest".
 Branching out once again in 1957, the company purchased Charmin
Paper Mills and began manufacturing toilet paper and other paper
products.
 One of the most revolutionary products to come out on the market
was the company's "Pampers", first test-marketed in 1961.
 DIVERSIFICATION
 In 1996, Procter & Gamble again made headlines when
the Food and Drug Administration approved a new
product developed by the company, Olestra. (a
substitute for fat in cooking potato chips )
 In 2008, P&G branched into the record business with its
sponsorship of Tag Records, as an endorsement for
TAG Body Spray.
 In 1911, began producing Crisco, a shortening made of
vegetable oils rather than animal fats.
 As radio became more popular in the 1920s and 1930s,
the company sponsored a number of radio programs. As
a result, these shows often became commonly known as
"soap operas".
 ACQUISITIONS
 In 1930 acquisition of the Newcastle upon Tyne-
based Thomas Hedley Co. terms of
manufacturing and production.
 Folgers Coffee, Norwich Eaton Pharmaceuticals,
Richardson-Vicks, Noxell, Shulton's Old Spice,
Max Factor, and the Iams Company, among
others were also acquired.
 In January 2005 P&G announced an acquisition
of Gillette, forming the largest consumer goods
company and placing Unilever into second place.
 CONTROVERSY NO. 1
“ Logo controversy”
 The company received unwanted media publicity in the 1980s when
rumors were spread that their previous corporate logo was a
Satanic symbol. The company has sued and attempted to sue a
number of companies like Amway and individuals who have spread
rumors of this type, in some instances because they sell competitive
products and have spread such rumors for the purpose of tarnishing
P&G's image to increase sales of their own brands.
 However, the continuous media coverage prompted P&G to adopt
an entirely new logo consisting of just
the letters P&G. In television commercials
in China, the former P&G logo still appears
at the end of each commercial, and up until
2004, it appeared at the end of each
commercial in Japan.
 CONTROVERSY NO. 2
“Crest Pro-Health Teeth Staining and Loss of Taste”
 In October 2007, a class action lawsuit was filed
in the State of Georgia alleging that many users
of Crest Pro-Health mouthwash suffered stained
teeth and loss of their sense of taste.
 Procter & Gamble contends that these side
effects occur in only 3% of users.
The suit seeks to include
disclosure warning users of
these side effects on product
packaging.
 CONTROVERSY NO.3
“Environmental record”
 Researchers at the University of Massachusetts have identified
Procter & Gamble as the 52nd-largest corporate producer of
air pollution in the United States, with roughly 350,000 pounds of
toxic chemicals released annually into the air.
 In 2007 Procter & Gamble pledged to reduce their carbon
emissions, mainly through reduction in packaging. The stated
emission reduction goal was 10% by 2012.
 Procter & Gamble is one of the founding members of
Carbon Disclosure Project's Supply Chain Leadership Council.
 Procter & Gamble has for several years funded a recycling school in
the slums of Cairo, Egypt.
 CONTROVERSY NO.4
“Animal testing”
 P&G conducts research using animals to demonstrate
safety or efficiency of their raw materials and
products.This has led to a worldwide campaign to raise
public awareness and to stop P&G being involved in
animal testing.
 The campaign is led by Uncaged Campaigns in the UK
and Stop Animal Exploitation Now in the USA.
 In 2002 P&G was recognized by the
Humane Society of the United States
for "advancing alternatives to
animal testing".
 MARK ET RESE ARCH
 P&G employed market researchers for
every product division. The company also
had two independent in-house research
groups which were responsible for
advertising research and market testing...
 Qualitative Research Tools
 Quantitative Research Tools
 Conducting Marketing Research Online
 The Benefits
 Qualitative Research Tools
 Generate new ideas for product and market
development.
 The researchers engaged the customers in
detailed discussions over different features of
the company's products. As a result, the
personal interaction between the researchers
and the consumers was high.
 The major qualitative research tools used by
P&G included focus-group discussions, in- home
visits, in-context visits and in-store interviews...
 Quantitative Research Tools
 P&G also employed quantitative research tools
extensively. These tools helped in generating
new product ideas for P&G.
 While the sample sizes for quantitative research
was usually larger, the personal interaction
between the researchers and the respondents
was minimal...
 Tools like surveys through
web or practical approach
in the market.
 Conduc ti ng Ma rke ting Researc h
Onli ne
 P&G conducted online concept tests to get
feedback from consumers. This feedback helped
it in new product introduction and launching
improved versions of existing products...
 The Benefits: P&G's online surveys saved
considerable time and costs for the company.
Using traditional methods,
a consumer survey cost
the company around
$50,000 and took at least
three to four weeks...
P&G’ s SCOPE BRAND OF MOUTHWASH
 INTRODUCTION OF SCOPE
 This mouthwash product has been around for well over
hundred years. It has good reputation as notable brand
that kills the germs that cause the bad breath. It also
can be successful although it not as old as Listerine
product in mouthwash market.
 It has been proven to kill more germs. Otherwise its also
well knows as bad breath remedy.
 Scope products are just not available in original mint
flavor (green), but also in a citrus (orange), peppermint
(blue), cinnamon (red) flavors & new Scope White. Its
major competitor in mouthwash market is a Listerine
brand.
 Defining Problems
 First is to develop a strategy that would ensure the
continued profitability of scope in the face of these
competitive threats. This means that their old strategies
are not suitable with the customer needs. The
innovations from other brand competitors make their
brand decreasing in customers satisfaction.
 The second is a how to maintain their profit and make
sure the Scope brand is always be the 1st in mouthwash
product ranking. This means that
the Scope ranking is decreasing from
the first choice to second choice of
customer. Listerine be the popular
and the first choice of customers.
 SWOT analysis
 STRENGTHS
Scope was long experience in the oral hygiene industry since 1967.
The taste or flavor of Scope better than other mouthwashes.
High-quality product, quality processes and procedures.
Have a first rating in mouthwash market share.
 WEAKNESSES
Not enough make a distribution channel.
Lack of canning or packaging.
Undifferentiated products or services with other competitor.
 OPPORTUNITIES
Brand which it concentrate for a healthy oral.
Move into new market segment that offer improves profit.
A developing market such as in the Internet.
Place more distribution channel such as more drugstore and food store
 THREAT
Too many competitor in this industry.
Price wars with other competitor.
Not patentable , competitor can attempt to duplicate a product
ENUMERATE THE DECISION FACTORS
 Two sets of decision factors must be
enumerated in the decision-making process is
alternative courses of action and uncertainties.
Alternative courses of action are controllable
decision factors because the decision maker has
complete command of them.
 Uncertainties are
uncontrollable factors
that the Protect &
Gamble, Inc. cannot
influence.
 IDENTIFY THE BEST ALTERNATIVE
 Create a product extension and innovation: For
examples; produce a product that closely functioning like
a mouthwash products such as dental gums. Dental
gums are promoted to reduced plaque, whiten teeth,
and reduce the risk of tooth decay.
 Increase the variety of an offering. For examples in
November 2004, P&G come out with their new
mouthwash product called Crest Pro-Health which
present as their product extension. This product is in the
same product category of the mouthwash products. The
effort is intended to draw Listerine users who've resisted
P&G's Scope.
Develop a plan for implementing the chosen
alternative
 Establish a R& D (research and
development) group which able to make a
new innovation of Scope products
 Improving production by upgrading
Technology
 Brand building and

better marketing
strategies
Was the decision appropriate?
 Yes, the decision was appropriate. As u know
that the Listerine has done this and grown up by
doing this in the last few years.
 Examples can be cited from cross functional
industries where investment in marketing the
product
has proven successful
like Pepsi, Sony, Nokia,
etc
 The Fut ure – Oppor tuni ti es &
Chall enge s
 Suppl y Cha in Ser vice Pro vi de rs
 In nova ti on Ser vi ce Pro vi der s
 Need ‘so ftwa re ’ as mu ch as ‘h ar dware’.

Opp ortuni ty:

 Lead de fini ng the use of Co nt ract
Man ufacturer s
wit hin the Consu mer Pr oducts in du st ry….
requ ires cap abi li ty.

Chall en ges :
 Cap it al / inv est men t nee de d to cr eat e thi s
capa bil it y.
 Req ui res ‘bus in es s st rat eg ies and focu s on co re