Answered: 1. PAGS impressive portfolio includes…

Principles Of Marketing

17th Edition

ISBN:9780134492513

Author:Kotler, Philip, Armstrong, Gary (gary M.)

Publisher:Kotler, Philip, Armstrong, Gary (gary M.)

Chapter1: Marketing: Creating Customer Value And Engagement

Section: Chapter Questions

Problem 1.1DQ

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Transcribed Image Text:Lang-torm outlook. P&G takes the time to analyze sach opportunity carefully and prepare the best prod- uct, then commits itself to making this product a suo- cess. It struggled with Pringles potato chips for almost a decade before achieving merket success. Recently. P&G has focused on increasing its presence in devel- oping markets by concentrating on affordability, brand awareness, and distribution through e-commerce and. high frequency storns. Product innovation. P&G is an active product innove- tor, devoting $2 bilion annually to research and devel opment, an impressively high amount for a packaged- goods company t employs more science PHDS than Harvard, Berkeley, and MIT combined and applies for roughly 3,800 patents onch ynar. Part of its innovation process is to develop brands that offer new consurmer benefits. Recent innovations that created entirely new categories include Febraze, an odor eliminating fabria spray, Dryel, a product that helps "dry-cloan" clothes at home in the dryer; and Swtfer, a cleaning system that more effectively removes dust, dirt, and hair from create strong consumer awareness and preference. Ih recent years, the company has shifted more of its advertising budget to online marketing efforts and social media such as Facebook, Twitter, and blogs. These efforts help infuse stronger emotional ap- peals into its communications and areate deeper consumer connections. Aggressivo salas forca. PSGs sales force has been named one of the top 25 by Sales & Marketing Management magine. A kny to its success is the close ties its sales force forms with retalers, notably Walmart. The 150-person team that serves the retail giant works closelywith Walmart to improve both the products that go to the stores and the process by which they get there. Manufacturing oficiancy and cost cutting P&G's repu- tation as a great marketing company is matched by its excellence as a manufacturing company. P&G spends signiicant amounts developing and improv- ing production operations to keep its costs among the lowest in the industry, allowing it to reduce the premium prices at which some of its goods sel. floors and other hard surfaces. Quality stratagy P&G designs products of above average quality and continuously improves them in ways that matter to consumers, including Tide oom- pact detergents, Panpers Rash Guard (a dioper that trests and prevents dieper rash), and improved two-in- one sharmpoo and conditioner products for Pantene, Vidal Sassoon, and Pert Plus. Brand-managomant systam. P&G originated the brand-management system, in which one execu- tive is responsible for each brand. The system has been copied by many competitors but not often with P&G's success. Recenty, P&G modified its general management structure so cach brand cat- egory is now run by a category manager with vol- ume and profit responsibility. Although this new organization does not replace the brand-manage- ment system, it helps to sharpen strategia focus on key consumer needs and competition in the category. Brand adansion stratogy P&G produces its brands in several sizes and forme. This strategy gains more shef space and prevents competitors from moving in to satisty unmet market needs. PSG ako uses its strong brand names to launch new products with instant recognition and much less advertising outlay. The P&G's accomplishments over the past 173 years have Mr. Clean brand has been extended from household come from successfuly orchestrating the myriad factors cleaner to bathroom cloaner, and even to a carwash that contribute to market leadership. system. Old Spice extended its brand from men's fra- grances to deodorant. Crest successfully axtended Questions into a tooth whitening systen caled Crest Whitestrips 1. P&Gs impressive portfolio includes some of the that removes surface stains from teeth in 14 days. strongest brand names in the world. What are some of the challenges and risks associated with being the market leader in o many categories? Mutbrand stratagy P&G markats sevoral brands in the same product catngory, uch as Luv and Parmpers d apers and Oral-B and Crest toothbrushes. Each brand 2. With social media becoming increasingly important meets a diferent consumer want and competes against speciic competitors' brands. A the sarme time, P&G is careful not to sel too many brands and has reduced its vast array of products, siron, fevors, and varieties in re cent yoars to asemble a stronger brand portiolio. Communicatian pianoor. With its acquisition of Gillette, P&G became the nation's largest advertiser, spending over $2.3 bilion a year or nearly twice as much as the number two company, General Motors Corp. P&G pioneered the power of television to and fewer people watching traditional commercials on television, what does PSG need to do to maintain ts strong brand images? 3. What risks do you foel P&G will face going forward? Seure rt, Tgt C te Muh Mn'aha M1,200, Dronter 200 Jot ahin, "TWotnarg"bit trary 20n, . 13-24 a N, G ompto: Co n" AdertngAge May 2, 2E, 1 gan "e Nlan Company lm p TamuS La tr T Ntn Can Dnter 12, 20

Marketing Excellence
the doors to new product categories. Armong these were
Fichardson-Vicks (makers of personal care products like
Pantene, Olay, and Vickaj. Norwich Eaton Pharmaceuticals
(makers of Pepto-Bsmal. Gillette, Naxel (makers of
Noxczernaj, Shulton's Old Spice, Max Factor, and the lams
Compeny
Today, P&G is one aof the most skilful marketers of
consumer packaged goods in the world and holds one of
the most powerful pcrtfolios of trusted brands. The com-
pany employs 138,000 people in more than 80 countries
>>Procter & Gamble
Pampers
Teaby- Dry
worldwide and has total worldwide sales of more than
$79 bilion a year. It is the leader in 15 of the 21 product
categories in which it competes, has 23 bilion-dollar
global brands, spends more than $2 bilon annualy on
FRD, and serves more than 4 bilion people in 180 difer-
ent countries. Its sustained market leadership rests on a
number of capabities and phlosophies:
Procter & Garmble (P&G) began in 1837 when brothers in-
kaw Willam Procter and James Garmble, whose wives were
sisters, formed a snal candle and soap company. From
them, P&G innovated and launched scores ol revolutionary
products of superior quaity and valun, including vory soep
in 1882, Tide laundry detergent in 1946, Crest toothpaste
with fluoride in 1965, and Pampers disposable diapers in
1961. PSG aho acquired a number of comparies to open
• Customor knowladgo. P&G studies its customers-
both end consumers and trade partners- through
continuous marketing rescarch and intelligence
gathering. It spends more than $100 milion on aver
10,000 formal consumer research projects every
year and generat es more than 3 million consumer
contacts via its e-mail and phone center. It also
emphasizes getting ita marketers and researchers
out into the field, where they can interact with con-
sumers and retailers in their natural environment.

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