Proctor and Gamble

Karl Wezmar
Williamjeet Singh
Jhamb Gaurav
Gurpreet Singh
Proctor and Gamble
Karl: Intro, history, products and marketing
Gurpreet: Research and development, innovations and
diversity
Gaurav: Creditors, shareholders, P&G’s financial
information, and mergers
Williamjeet: SWOT/SWOC, consumer relations,
comparisons to other firms in the market
Proctor and Gamble - mission
“We will provide branded products and services of
superior quality and value that will improve the lives of
the world’s consumers. As a result, consumers will
reward us with leadership sales, profit and value
creation, allowing our people, our shareholders and the
communities in which we live and work to prosper”
Proctor and Gamble - History

1837 - William Procter and James Gamble

 Immigrated from Ireland and England
 Began to manufacture soap and candles
 Headquartered in Cincinnati, Ohio - currently still is
1857 - sales reached $1,000,000.
 Had around 80 employees at this time
1882 - ivory soap - mass marketed
 Promoted it’s purity in print ads - it “floated” in water
 Set a new standard for mass marketing
1915 - son of Gamble created the first community
campaign for charities
 Known today as “The United Way”
Proctor and Gamble - History
During the American Civil War
 P&G won government contract - supplied soap and candles
to the Union Army
 Increased profits during an uncertain time
 Familiarized soldiers with P&G products
Proctor and Gamble - History
1920’s - 1930’s - “Soap operas”
 Sponsored & produced dramatic radio series
 When most housewives were home
 Mostly female audience
 Used P&G’s cleaning products the most
 Eventually segued to soap operas as we know them today
 Ivory soap - 1
 Ivory soap - 2
Procter and Gamble - History
1961 - Introduced pampers
 Reduced leaks, mess and rashes caused by cloth diapers
 First affordable and successful disposable diaper
 Today, more babies around the globe use Pampers more
than any other brand of diapers.
Proctor and Gamble - History
1984 - P&G named top 100 companies to work for

1996 - P&G earned the U.S. Government's National

Medal of Technology
 For creating, developing and applying advanced
technologies to consumer goods
Proctor and Gamble - History
2005 - acquiring Gillette
 Formed the largest consumer good company
 More discussion on Gillette later….
Proctor and Gamble - products
Personal & Beauty

House & Home

Health & Wellness

Baby & Family

Pet Nutrition & Care

More the 300 in total

Personal and Beauty
Antiperspirants and deodorants
 Such as Old Spice and Secret

Body wash and soaps

 Such as Camay, Ivory, Zest, Olay
Personal and Beauty
Colognes
 Such as Old Spice

Cosmetics
 Such as CoverGirl and Max Factor

Feminine Products
 Such as Always and Tampax

Hair Care
 Such as Pantene, Head and Shoulders, and Herbal Essences
Personal and Beauty
 Oral Care
 Such as Scope, Crest and Fixodent

Designer Fragrances
 Such as LACOSTE, HUGO and PUMA

Shaving
 Such as Gillette, Gillette Venus and Braun

Skin Care
 Such as Olay and Noxema
House and Home
Air Fresheners
 Such as Fabreeze

Batteries
 Such as Duracell

Dish Washing Soaps

 Such as Ivory, Joy and Cascade

Household Cleaners
 Such as Mr. Clean and Swiffer
House and Home
Fabric cleaners
 Such as Bounce, Cheer, Deft, Gain and Tide

Paper products
 Such as Bounty, Puffs and Charmin

Small appliances
 Such as Braun

Snacks
 Such as Pringles
Health and Wellness

Health Care
 Such as Fibersure, Metamucil, Pepto-Bismol

Prescription Drugs
 Such as Actonel, Macrobid, Enablex
Pet Care and Nutrition
Dog foods
 Such a Eukanuba and Iams
Some Failed Brands
Olestra (aka Olean) - 1996
Fat substitute - added no cholesterol, fat, or
calories to products
Caused “anal leakage” in some individuals
Blocks absorption of some vitamins
Warning label was affixed to chips - sales declined
Olestra is banned in many countries
 Including Canada and Britain
 Still in use in the U.S.
P&G sold plant in 2002
 Olean is still in some of P&G’s products
 Some Failed Brands

Fit - Fruit and vegetable wash

 Lunched in 2000
 Sold for 3 years
 At a loss of $50,000,000.

Hidden magic hair spray

 Reported be act more like glue and hair spray
 Dubbed “the Titanic of the hair-spray business
 Phased out in late 60’s
Some Failed Brands
Encaprin
 P&G’s first competitor to Tylenol and Advil
 Beat sales of both when first introduced in 1984
 2 years later, forced off the market by a cyanide poisoning
hoax

Torangos
 Stackable, triangular corn-based chip
 2001 – 2003
 Reported to taste and feel like card-board
Branding Quiz
Brain teaser - branding
P & G Innovation
P & G is unique in its innovation.
Innovation focuses on both existing and entirely
new products.
Their capability is based on 3 characteristics.
1.A deep understanding of consumer
2.Applying new technology
3.To make connection between consumers wants
and what technology can deliver.
R&D
Invest 4 % of worldwide sales

P & G has world class global R & D organization, with

more than 7500 scientists working in 22 research
centers in 12 countries around the world.
Received National Medal of Technology, the highest
award the U.S govt. gives for achievement in
technology.
Have 24000 active patents worldwide and on average,
receives 3800 patents per year.
Market Research
P & G employs market research for every product
division. The company also had two independent in-
house research group which were responsible for
advertisement research and market testing,
Qualitative research tool

Quantitative research tool

Conducting marketing research online

Qualitative Research Tools
Generate new ideas for product and market
development.
The researcher engaged the customer in detailed
discussion over different features of the company
product.
Major qualitative research tools used by P & G include
focus group discussions, home visit, in-store interview.
Quantitative Research Tool
P & G also employed quantitative research tools
extensively . These tools helped in generating new
product idea 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.
Conducting Marketing Research Online

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.
Benefits
P & G 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.
 Diversity
P&G we believe it is important to develop and support a
diverse workplace.
Our diversity covers a broad range of personal attributes and
characteristics such as race, sex, age, cultural heritage,
personal background and sexual orientation.
Number of women and U.S. minorities at the vice
president/general manager level has doubled over the past
five years.
 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.
Shareholder Investment Program at P & G
Direct Stock Purchase and Dividend
reinvestment plan.
P& G shareholders as well to new shareholders
Requirements for becoming shareholder at
P&G

Minimum Initial Investment

Reinvestment of dividend

Transferred or sold through the Program

Once a shareholder, the minimum investment into the

plan is $50.
Corporate Governance at P & G
Management, shareholders and the board working
together.
Employees are long term employees.

Doing what’s right.

A foundation of integrity, control and custodian.

Dividend History of P & G
Paid dividend without interruption.
Compound annual growth rate is 9.5%.

Year Dividend per share

1956 $0.01
1970 $0.04
1984 $0.15
1998 $0.51
2009 $1.64
Common Types of Shareholder
Registration

Individual registration.
Joint registration.
Joint tenants with rights of survivorship.
Tenants in common.
Custodial registration.

Corporate registration.
Partnership registration.
Replacing certificates requirements at P&G

Written notification from shareholders.

Following information should be included in the
letter.
 Name in which the certificate was registered, shareholder
Social Security number and account number.
 Number of shares on the certificate and certificate number, if
you know it.
 Reason for replacement. If the shareholder is deceased, the
executor/administrator of the estate should contact
Shareholder Services requesting replacement.
Five year cumulative total return of
P&G
Cumulative return
is the total profit including dividend, interest and capital gains.
received on an investment over a period of time.
Year 2004 2005 2006 2007 2008 2009
P&G $100 $99 $106 $119 $121 $105

*These returns are cumulative value of $100 investment.

P & G’s Values
Integrity
Leadership
Ownership
Passion for winning
Trust
P & G’s Principles
Respect for all individuals
The interest of the company and individual are
inseparable
Strategically focused in work
Externally focused
Seek to do the best
Mutual interdependency is a way of life
Strengths
One of the best marketers in the world

Diversified and innovative product portfolio

Talented management

Largest retailers in the US and around the world

Strong finances in the recent years

Weaknesses
Lagging behind in online media presence

Don’t manufacture private label products for its retail

• Decreased revenues in their Northeast
Asian Market
Opportunities

Utilizing online social networks

Eco friendly

Capitalizing on online media

Emerging markets

Demographic trends across the world

Challenges
Competitors

Private label growth

Rising cost of energy prices

Increase in raw material prices

Economic slowdown in the US and other countries

Competitors
Johnson & Johnson Co.

Kimberley-Clark Co.

Unilever Co.
P & G Comparison
Revenue ($M) Net Income Market Employees
($M) Capture

P & G Co. $83,503 $12,075 $166.90B 135,000

Unilever Co. $58,508 $6,022 $95.66B 174,000

Johnson & $60,530 $12,770 $165.40B 117,000

Johnson Co.

Kimberley- $18,266 $1,822 $25.50B 53,000

Clark Co.
“Consumer is boss”
Our company is about making the right choices in how we
address consumer needs, desires, and aspiration, such
that, 50 years from now, we remain a thriving and
successful corporation.
Consumer concerns
Osteoporosis

Women’s health education

Cold and flue tips for kids

Water purification
P & G Initiatives
New cleaning methods that use less water, cold water,
and even salt water
Disinfectant soaps, and detergents to improve sanitation

Crest dental hygiene training

P & G Social Programs
Egypt: building washing clubs in Beheira to reduce the
rate of infection
Syria: health program to improve mother and child
health
Philippines, Pakistan & Mexico: hand wash campaign

Guatemala: water purification campaign

The End
Questions or comments?