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P&G, Light Duty Liquid Detergents

Better Essays

Advertising & Promotion
Spring 2009

Procter & Gamble (B)
Light Duty Liquid Detergents

May 16, 2009
Amanda Barraza
Ted Chiang
Olga Shipilo
Clare Tan

1.What factors and policies guide promotion planning for the LDL’s?
i)Budget Allocation: The LDL managers of Ivory Liquid, Dawn, and Joy spend about half of their marketing budget in advertising and with a lower share on promotion. This is different from the strategy of Colgate & Lever, who spends a higher percentage on promotion. The marketing budget for H-80 is $60 million for the first year, which includes $18 million on advertising, $37 million on promotion, and $5 million of miscellaneous marketing expenses. ii)Scheduling of LDL Promotional Events: The …show more content…

From 1979 to 1981 the share of consumers who claimed that they almost always used a manufacturer’s coupon increase by 6% to 28%; those who never used coupon “just occasionally” or “never” decrease by 4% and 3%, respectively.

Secondly, research indicates that for a new brand such as H-80 trail size represented by far the best purchase incentive for a consumer who had never tried a brand. Research has also pointed out that free mail-ins is an effective tool to achieve sampling of new users.

vii)Existing and New Competitors The LDL environment was becoming more intense, characterized by the increasing use of coupons and the entry of new brands with higher promotion budget than that of H-80.

viii)Promotion Alternatives
a.Trade Allowances: Based on previous experience, the sales division has recommended that $2.7/statistical case trade allowance on all sizes in the first 3 months was necessary to stimulate initial stock, in-store displays, and feature advertising by the trade. Furthermore, a $1.8 /statistical case allowance is believed to be effective as a fourth promotion event.

b.Sampling: An analysis based on 40.4 million households (50% of target households) indicates that the sample size of 6 ounce, 3 ounce, and 1.5 ounce are the most cost efficient sizes for sampling (Table 1). However, due to budget limitation Garner would not be able to afford sending out 6 ounce

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