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From Dog Food to Body Wash 22Procter and Gamble: From Dog Food to Body WashLaura Buckner, Landon Heidenreich, & Jennifer SimpsonBusa-30810 May 2007Table of ContentsI. Company Description3II. Business Mission4III. Marketing Objective5IV. Situation Analysis6a. Industry Analysis6b. SWOT Analysis10V. Marketing Strategy13a. Target Market Strategy13b. Marketing Mix151. Product152. Place/Distribution163. Promotion174. Price19VI. Implementation, Evaluation and Control19a. Marketing Research19b. Organizational Structure and Plan19c. Financial Projections20d. Summary21I. Company DescriptionWilliam Procter and James Gamble, in Cincinnati, Ohio, founded Procter and Gamble in 1837. They started the business by making and selling their own soap and candles. On October 31, 1837, they formalized their relationship by signing a partnership agreement. The partnership flourished under the two founders and family members became involved in the business. In 1879, James Norris Gamble, a son of James Gamble, and Harley Procter, a son of William Procter, created a white soap equal to other high quality soaps in the marketplace, which they named Ivory. This product became a huge success for the company and remains one of their most recognized products. Procter and Gamble slowly started releasing different types of products such as laundry detergent, diapers and toothpaste. They have continued to be innovators in household products throughout the decades and today, Procter and Gamble has nearly 300 brands in over 160 countries. They are constantly researching and developing new products that range from Personal and Beauty, House and Home, Health and Wellness, Baby and family, to Pet Care and Nutrition. They are committed to helping consumers with health, hygiene, and convenience. The company is broken into three different segments: Health and Beauty, Household care, and Gillette. Their products are sold through merchandisers, grocery stores, clubs, and drug stores.Their main headquarters remains in Cincinnati, Ohio but they have operation offices in North America, South America, Europe and Asia. The company employs approximately 138,000 people. P&G value their employees and treat them with respect. They were the first company to have a profit sharing program awarding their employees for meeting goals. They ensure that their employees understand and utilize the companys values and principles in their work for the company. II. Business MissionProcter and Gamble is one of the most admired companies in the world. They take pride in their products, values and principles and involvement in the world. Their mission statement or purpose reflects this pride. Their purpose, as stated on their webpage, , is that “we will provide branded products and services of superior quality and value that improve the lives of the worlds 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” (Purpose ). Procter and Gambles quality products are the result of their massive investment in research and development. They are continually improving existing products and brands while creating new products. They understand what their consumer wants and have the technology to develop the products that will meet these wants. Additionally, Procter and Gamble view their employees as the most important asset of the company and encourage them to have the same values and principles as the company. All employees of Procter and Gamble are considered leaders and encouraged to take responsibility to do the best that they can while meeting business needs, bettering the system and helping those around them (Values ). They try to do what is right in all situations. Honesty is valued in the workplace and employees expect fellow employees to be honest in the workplace. They are encouraged to be skeptical of the operating norm and to offer suggestions that will improve the workplace. From these employees values, the principles of the company can be seen. Procter and Gamble shows respect for all individuals who deal with their company and treat them honestly. Leaders of P&G understand that the success of the company is dependent upon them developing policies that are right for the company. They define objectives for the company and focus on meeting these goals. The company not only is internally focused but also it concentrates on relationships with consumers and suppliers (Principles ). Procter and Gamble learns from both their success and failures to achieve their mission. Overall, they try to make the company the best it can be while upholding their beliefs.Beyond just making the best products, Procter and Gamble tries to improve the communities that they touch around the world. The company believes they have a social responsibility to these communities. On the basic level, they provide products that improve the lives of their consumers in terms of health and convenience. By treating their employees fairly they contribute to their social and financial well-being. On the global level, they give aid to philanthropic programs such as Humanitarian and Disaster Relief. Procter and Gamble also produces products that are safe to the environment in both production and in their use. They strive to better the quality of life for everyone both now and in the future. III. Marketing ObjectiveProcter and Gambles main marketing objective is to go beyond providing what the consumer wants but more specifically know what the consumer wants before they do and create a need for it. The world today is constantly changing and Procter and Gamble focuses on understanding these changes and creating new products or upgrading an existing brand that meet the shifting needs of consumers. They aspire to transform “culture into a consumable item” (Marketing ). The role of the consumer has revolutionized over the past few decades. Their values have changed and Procter and Gamble works to understand these changes and build their brands and products to symbolize these values.Procter and Gambles marketing department meet their objectives by having their employees focus on a single brand rather than developing marketing strategies that could fit any brand the company produces. These employees have a larger role than just creating a marketing plan for their brand. They gain knowledge of their brand by working with the research and development, manufacturing, sales, production, and distribution of their brand. This background provides them a better understanding of the brand, which they are marketing. By using this brand knowledge and understanding the consumer at an in depth level, the marketing employees combine this information into a marketing plan. Each brand becomes “their baby” and marketing employees nurture it to see the success of that brand through meeting the needs of their consumers.IV. Situation AnalysisIndustry AnalysisTrendsAs stated in the Yahoo Finance webpage, Procter and Gambles main industry in which they compete is Personal Products (PG industry ). The industry focuses on selling products that meet the needs of everyday consumers in areas such as personal hygiene, beauty and health, pet care and other household products. A major issue within this industry is the contaminated pet food. Many companies have been forced to recall their pet food products because of the dangerous and harmful threat it poses to animals. Consumers want a product that they know will be safe for their pets. These customers of the personal products industry have begun to look elsewhere for their pet food products taking revenue away from the leading companies in this industry such as P&G. These companies must regain the trust of these customers by putting a product on the market that is safe for all pets and take all measures to ensure that the contaminated pet food is off the market.Another growing trend in the personal products industry is for companies to make environmentally safe products. More and more consumers are becoming aware of the impact, which everyday personal products have on the environment. Global warming and our actions in slowing it down has become headline news. Companies must find ways to produce products that are safe for the environment while continuing to be of high quality and of similar prices to past products. Consumers are becoming more inclined to buy a product that is safe for their family and is safe for nature even if it means they have to pay a little bit more for it. To stay competitive, companies such as Procter and Gamble must continue spending money in their R&D department to create safe and environmentally friendly products. CompetitorsProcter and Gambles three main competitors are Johnson and Johnson, Kimberly-Clark, and Unilever. These companies match or come close to matching the revenue of P&G. There are differences among the products sold between the companies but they all have similar product ideas. Johnson and Johnson has the highest net income of these companies. The primary revenue generator for the company is their health care products. They have a strong brand association with their Band Aid and Neosporin products. Furthermore, Johnson and Johnson focuses on providing products to doctors, nurses and patients that need and use these health care products. Johnson and Johnson, as a company, strives to meet the need of their customers while providing a fair profit to their suppliers and distributors (). They also take responsibility to give back to the community that they live in. Through their quality products, commitment to their customers and giving back to the community, Johnson and Johnson is a tough company with which to compete. The Kimberly-Clark company dominates the health and hygiene markets. Some of their larger brands range from Kleenex to Depend Diapers. According to their website , they hold the number one and number two shares in their markets in over 80 countries (). They base much of their innovation off their customers preferences and wants. Their three concerns with being successful are quality, service and fair dealing. Unilever is a food, home, and personal care company. Their products vary from Vaseline to Ben and Jerrys Ice Cream. They focus on constantly enhancing and developing products that better the lives of their customers. Unilever makes everyday products for people that want to use a safe and healthy product. Customer ProfileProcter and Gamble is constantly looking for new ways to meet the needs of their customers. These customers range from men and women to cats and dogs. P&G has a couple different ways they research to meet their consumers needs: qualitative and quantitative. P&G conducts their qualitative research by having focus group discussions, in-home visits in-context visits, and in-store interviews. This allows P&G to interact personally with their consumers to get their opinions and facts on how their products are helping or not helping them. Their quantitative research includes habits and practices, blind tests, concept aided usage and quality monitoring. The quantitative research is used to see habitual data and use this for new ideas relating to how consumers use these products in their homes and outside of their homes. Quantitative research involves larger groups and statistical data analysis. These types of researches help the company in many different ways. It can help management and improve the way they make decisions, it make it easier to trace problems, and helps the company to focus on new, different ways to maintain their existing customers.InnovationsProcter and Gamble is constantly trying to find ways to improve their products related to personal and beauty, house and home, health and wellness, pet nutrition and care. These are the companys primary product lines and they are continually researching and developing new ideas to improve the products.Procter and Gamble has focused a lot of research on their personal and beauty line. They have researched different types of hair and skin, and have developed products to fit theses types. P&Gs hair product line deals with the different lengths, treatments, problems and disorders of hair. They develop products such as shampoos and conditioners and styling products to fit the needs of the different hair types. Procter and Gamble conducts similar research on skin structure, identifying the different types of layers and the genetics of skin. This research provides insight into different skin problems including what effect the sun has on the aging of skin. They have developed many different lotions, moisturizers and oils to help take care of the skin throughout a lifetime. Proctor and Gamble has discovered several innovations for their house and home products. A lot of research was invested in combining laundry detergent with bleach to provide consumers a single product for the laundry room. This was a difficult task because of the composition of bleach and its effects on clothes. They eventually found a way to make bleach safe for fabrics and stable when mixed with detergent (). The research that was conducted to find a way to mix the two was expensive but now the mixture of bleach in laundry detergent is affordable for everyone. Another major innovation in the house and home product line was the improvement of the paper towel, which involved a change in the papermaking process (pgcom). The “absorbent capacity, strength, flexibility, softness, and thickness of structured tissues, and towels make usage more convenient, faster, and comfortable” (). These developments have set P&G above their competitors in the house and home product lines. Procter and Gamble has also invested heavily in research for their other product lines that has resulted in many improved products. They have developed different formulas related to toothpaste particularly Crest. In addition, they have developed leak proof diapers for their baby care line, Pampers. In their pet nutrition and care line, Iams and Eukanuba, they are providing healthy food products for animals. SWOT AnalysisThe SWOT analysis gives an overview of Proctor and Gamble internal strengths and weaknesses and the external opportunities and threats. According to Marketline Business Information Centre, P&Gs SWOT analysis is summed up with the following:Strengths Procter and Gamble has gained a leading market position with most of its businesses. They are the global market leader in the beauty segment. They are also leaders in the oral care and fabric care segments. Their brands amongst these segments have become leading names. This leading market position provides the company a competitive edge and stable financial growth. The company has a diversified and innovative product portfolio. They have over 300 brands that spans across 40 product markets. They have succeeded in becoming a world leader in brand creation and brand building. Their product portfolio is one of the largest with trusted, quality brands. Furthermore, Procter and Gamble focuses on product innovation. They conduct more than 10,000 research studies a year and work together with 4 million consumers all over the world. With their diverse and innovative product portfolio, they protect themselves from demand fluctuations amongst their product lines and gain customer loyalty and revenue growth. Procter and Gamble has posted strong finances in the recent years. They have had strong revenue growth across all of their key segments. In addition, their revenue growth and profit margins has been higher than the industrys average. Their positive financial statements have also strengthened the companys market position Weaknesses Procter and Gamble has quality control problems with some of their products. They have placed recalls on certain products such as cosmetics made in China and the Swiffer Sweep&Vac. If they have continual recalls, it could tarnish their brand image leading to lower customer loyalty. The company has seen decreased revenues in their Northeast Asia market. This market has such high profit potential and this current trend puts Procter and Gamble at a disadvantage with their competitors. Opportunities One of the greatest opportunities for any company is the developing markets of developing countries. These countries have market potential that is expected to increase in the next few years. Currently, Procter and Gamble only offers products in 10 of their top 25 product categories in most of the developing countries. They have an opportunity to expand their market shares in these developing countries. The demographic trends across the world are moving in a direction to help boost Procter and Gambles sales. The aging baby boomers of the US are becoming more beauty focused and using more beauty and anti-aging products. The cosmetic segment of P&G could benefit from this trend. Additionally, there is an increased demand for pet food all over the world. More and more households are owning pets and often times more than just one. Procter and Gambles Iams brand of pet food can become a major segment for the company aiming to meet this increased demand.Threats The markets that Proctor and Gamble compete in are filled with other large, well-established