Procter & Gamble : Marketing Capabilities

Harvard Business School Case

P G&

What is

?

An American multinational consumer goods

company headquartered in downtown

Cincinnati , Ohio , the U.S.

One of the most powerful portfolios of

trusted brands.

Who are the players ?

• CEO A.G. Lafley • CEO Bob McDonald• CEO Durk Jager• CEO Jim Stengel• Claudia Kotchka, o Vice-president, Design unit• Marc Pritchard, o Global Brand Building Officer

SITUATION

ANALYSIS

Good company background

Enters new market with a mission and

decisions

Takes scientific approach to

connect with people

Brings in a design unit as a part of

marketing strategy

Shift from product based marketing to consumer-centric

marketing

Communication through direct & digital

marketing & sales promotion

Multibranding

Tries to move forward with an aim to reach 5 billion new consumers

Connect &

Develop

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

ANALYSIS OF NET SALES AND EARNINGS

1. Growth of P&G’s core brands & categories with an

unrelenting focus on innovation & design.

2. Building business with unserved & underserved consumers

through consumer-centric , digital & direct and

neuromarketing , multibranding and interactive

community promotion.

3. Continue to grow & develop faster-growing higher margin

businesses with global leadership potential.

ONE

MAJOR QUESTION

Is “INNOVATION and R&D” The Secret Sauce

of Marketing for P&G ?

Growth of P&G’s core brands & categories with

an unrelenting focus on innovation & design.

1st ISSUE

• International expansion into markets of Latin America,

Western Europe, and Japan since 1930s.

• Approach- “Acquisition or joint venture on a small scale, and

through trial and error, learn the formula for success before

making a major commitment.”

• Mission- Improve the lives of its customers through

continued innovation to reach “More Consumers, In More

Parts of the World, More Completely.”

• Connect and Develop : A step towards innovation , research

and development of products

CONNECT-and-DEVELOP

Building business with unserved & underserved

consumers through consumer-centric , digital

& direct and neuromarketing , multibranding

and interactive community promotion.

2nd ISSUE

MARKETING STRATEGY

• Multibrand strategy- Brands of different product lines got individual support and satisfied a segment of the market.

• Design innovation & strategy unit- A culture of design introduced in P&G which complemented function-driven process.

• Consumer-centric marketing- Customization on the basis of needs of people.

• The firm leveraged its products through multibranding ,

focused on “Return On Marketing Investment” and shopper

marketing experience.

COMMITMENT TO THE

CONSUMER

• Innovative approaches in research gained qualitative and

quantitative information from consumer resulting in better

products and positive buying behaviour.

• Word-of-mouth advertising was followed. Campaigns like

“Thank you Mom” & “Loads of Hope” acted as emotional

branding.

• The pre and post purchase behavior were measured by

online grocer sites & Neuromarketing, building one-to-one

relationship with customers.

ADVERTISING

• Products sold directly through dramas , T.V commercials and

operas instead of including wholesalers and retailers in the

chain.

• “Media neutral” Advertised in different and relevant local

languages in less familiar markets.

• Lafley , Stengel and Kotchka aimed towards design and

emotion driven-advertising along with benefits and

functionality.

SPONSORSHIP

• Sponsored the U.S. Olympic team in 2010, 2012 winter

games, Russia and 2016 summer games, Brazil.

• Fitness campaign through NFL sponsorship & major

campaign “Thank you Mom” touched everyone’s heart.

CELEBRITY ENDORSEMENTS

• Endorsement of celebrities and spokesmodels for beauty

companies and products like CoverGirl cosmetics and

Pantene shampoo.

• Gillette and Head & Shoulders ads featuring sportspersons

were advertised through YouTube, T.V. , online and print

media.

• Promotion, sponsorship, and endorsement relationships and

nontraditional outlets, such as product placement in

television and film.

MEDIA SPENDING

• Recession- Shift to coupons and in-store promotional

activities maintaining its media presence, shifting ad costs.

• Increased ad spending by $1 billion with a 20% increase in

media impressions.

•McDonald focused on maintaining same level of spending,

spending on digital advertising and other new media to

broaden the audience.

DIGITAL MARKETING

• Niche experimentation through online serials , video games, and YouTube channels for specific products.

• Mobile marketing ad campaign, TV commercials and print advertisements had an online presence.

• “My Black is Beautiful” products- Two web series showcased products & attracted views online. Collection sales and market share increased.

• Old Spice television commercial and YouTube sensation, “The Man Your Man Could Smell Like,” bridged the power of digital and social media.

• One-to-one digitized marketer.

SOCIAL MEDIA

• Launched two social media sites: Capessa for women on Yahoo! Health and the People’s Choice Community, associated with the People’s Choice awards.

• Facebook as a marketing supplement- Acquired Facebook

friends & figured out how to use them.

• In 2011, P&G rounded out its earlier social media efforts

with Manofthehouse.com, which featured household advice

for men .

• Social media was a way to speak to its audience virtually.

INTERACTIVE COMMUNITY PROMOTION

• T-shirts having slogans and endorsed celebrities used to

promote sale of products like Tide. The T-shirts were worn by

celebrities, sold online and proceeds went to hurricane

affected families.

• A mass promotional activity held in Times Square targeted

holiday shoppers, generated YouTube ads and attracted

youth.

• An innovative ad including restrooms and spotless toilets

used to promote Charmin toilet paper, and tourists loved it.

Continue to grow & develop faster-growing higher margin businesses with global leadership potential

3rd ISSUE

MOVING FORWARD

Digital marketing with campaigns,Emotional, design and function driven marketing , R&D , consumer research & product performance.