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amit85
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procter and gamble - January 7th, 2007

BACKGROUND

In 1837 William Procter and James Gamble formed Procter & Gamble, a partnership in Cincinnati, Ohio, to manufacture and sell candles and soap. Both men had emigrated from the United Kingdom. William Procter had emigrated from England in 1832 after his woolens shop in London was destroyed by fire and burglary; Gamble came from Ireland as a boy in 1819 when famine struck his native land. Both men settled in Cincinnati, then nicknamed "Porkopolis" for its booming hog-butchering trade. The suggestion for the partnership apparently came from their mutual father-in-law, Alexander Norris, who pointed out that Gamble's trade, soap making, and Procter's trade, candle making, both required use of lye, which was made from animal fat and wood ashes.

Procter & Gamble was in competition with at least 14 other manufacturers in its early years, but the enterprising partners soon expanded their operations throughout neighboring Hamilton and Butler counties. Cincinnati's location on the Ohio River proved advantageous as the company began sending its goods downriver. In 1848 Cincinnati was also linked to the major cities of the East via rail, and Procter & Gamble grew.

Around 1851, when P&G shipments were moving up and down the river and across the country by rail, the company's famous moon-and-stars symbol was created. Because many people were illiterate at this time, trademarks were used to distinguish one company's products from another's.

P&G and BRAND MANAGEMENT

After its successes with Ivory and Crisco, P&G developed a new business technique called "brand management" Because it focused attention on a product rather than a business function, brand management turned out to be similar in its effects to the multi-divisional structure introduced by Alfred Sloan at General Motors. And it had the same powerful tendency to decentralize decision making.
The shift to brand management began on May 13, 1931, with an internal memorandum from Neil McElroy (1904-1972), an athletic young man who had come to P&G in 1925 right after his graduation from Harvard College. While working on the advertising campaign for Camay soap, McElroy became frustrated with having to compete not only with soaps from Lever and Palmolive, but also with Ivory, P&G's own flagship product. In a now-famous memo, he argued that more concentrated attention should be paid to Camay and by extension to other P&G brands as well. In addition to having a person in charge of each brand, there should be a substantial team of people devoted to thinking about every aspect of marketing it. This dedicated group should attend to one brand and it alone. The new unit should include a brand assistant, several "check-up people," and others with very specific tasks.
Thus was born the modern system of brand management. It was widely emulated, and in one form or another was still followed in the early twenty-first century by many consumer-products companies throughout the world. Typically, brand managers were energetic young executives marked for bright futures within a company. Brand management as a business technique was one of the signal innovations in American marketing during the twentieth century.






INNOVATIONS AT P&G

P&G's success was: "Find out what the consumers want and give it to them" Proctor & Gamble went to extreme lengths to do both. It hired hundreds of women to bake, wash dishes, and do laundry in their own homes, and then report the results. This kind of market research became the hallmark of P&G's approach to the development of new products and the continuous effort to improve existing ones.

One of P&G's best-known innovations was Procter & Gamble's corps of door-to-door interviewers. This group consisted mostly of young women who had graduated from college and therefore possessed "the maturity to travel alone," as one of their supervisors put it. A criterion for the successful applicant was that she be attractive but not inordinately so. Going from house to house armed with an imposing array of questions: about laundry, cooking, dishwashing, and every other activity for which P&G marketed a product or was thinking of introducing one. Female interviewers were instructed to wear a conservative dress, high heels, gloves, and a hat. As they knocked on doors and talked with consumers, they were to carry no lists, forms, or writing materials. The visits could then seem more casual, even though all conversations were designed to extract copious and specific data. Interviewers were expected to have total recall, and often would hurry back to their cars to record what they had learned.

When the company became a heavy television advertiser, it instituted its "DAR" (Day after Recall) method for measuring the impact and memorability of TV commercials. With the help of its many advertising agencies, P&G used focus groups and many other kinds of opinion-sampling techniques to adapt its products to changing needs and tastes and sharpen its commercial messages.

These major brands included:
Soap and laundry products: Ivory, Camay, Safeguard, Tide, Cheer, Bold, Bounce, Cascade, Joy, and Dawn
Paper goods: Bounty, Charmin, Pampers, Luvs, and Tampax
Personal care products: Pantene, Head & Shoulders, Oil of Olay, Cover Girl, Secret, and Sure
Food and beverage brands: Crisco, Folgers’s, Jif, and Pringles
Health care items: Crest, Scope, and Pepto-Bismol.

In 1931 Neil McElroy, a former promotions manager who had spent time in England and had an up-close view of Procter & Gamble's rival Unilever, suggested a system of "one man--one brand." In effect, each brand would operate as a separate business, competing with the products of other firms as well as those of Procter & Gamble.

In 1933 Procter & Gamble became a key sponsor of radio's daytime serials, soon known as "soap operas."

In the 1990s Procter & Gamble also hopped on the so-called "green" bandwagon of environmental marketing. It reduced packaging by offering concentrated formulations of products in smaller packages and refill packs on 38 brands in 17 countries.

Restructuring of Brand Management System

In 1987 the company restructured its brand-management system into a "Matrix System." Category managers became responsible for several brands, making them sensitive to the profits of other Procter & Gamble products in their areas. Procter & Gamble brands continued to compete against one another, but far less actively. The restructuring also eliminated certain layers of management, quickening the decision-making process. The company became more aware of profitability than in the past.

Category Management Model

Under the CMM, the brand managers did not compete against each other with similar product brands. Though the brand managers enjoyed the same autonomy, they are accountable to category managers. The category mangers were made responsible for the inventories, sales and profits of the entire product category or the product line. The brand mangers under each category worked together in close coordination with each other.
CMM also increased the responsibilities of brand managers. The CMM enabled P&G to manage its brand more effectively. Moreover, it also helped in further professionalizing the sales team and their efforts. For instance, prior to the implementation of this model, P&G's sales representatives focused on promoting an individual product or brand but after this they had to promote all product brands under one category. Hence the focus shifted from promoting individual brands to improving the profitability and market share of the entire product category.

Glocal Branding Strategy

By the early 90’s, P&G's operations expanded globally, the top management felt the need for further streamlining the brand management system. So they established the global strategic planning groups that constituted 3-20 individuals for each of its product categories. the GSPG's were responsible for developing global and local brand policies that involved decision making on the elements of brand strategy that had to standardized across the world and the elements had to be customized according to the local markets.
While the GSPG’s were responsible for developing the branding strategies, the implementation of these strategies was carried out by a global category team (GCT).Each of the product categories was handled by GCT which was headed by an executive vice president. The country specific brand mangers implemented the branding strategies in local markets.
P&G encouraged ‘branding teams’ at the country level to develop their own brand building programs. When the branding program was highly successful in a country, it was tested in other markets and implemented immediately.



Expansion of P&G

In September 1988 Procter & Gamble made its first move into the cosmetics business with the purchase of Noxell Corporation, maker of Noxema products and Cover Girl cosmetics, in a $1.3 billion stock swap. Procter & Gamble also planned to further develop its international operations. In 1988 the company acquired Blendax, a European health- and beauty-care goods manufacturer. The Bain de Soleil sun care-product line was also purchased that year. By 1989 foreign markets accounted for nearly 40 percent of group sales, up from 14 percent in 1985.

In March 2001 Procter & Gamble reached an agreement with the Coca-Cola Company to create a $4 billion joint venture designed to join Coke's Minute Maid brand and distribution network with P&G's Pringles chips and Sunny Delight drink brands. But Coca-Cola pulled out of the deal just a few months later, having decided to try to build the Minute Maid brand on its own. Despite this setback, P&G succeeded in paring back its ever more marginal food business by selling the Jif peanut butter and Crisco shortening brands to the J.M. Smucker Company. The deal, completed in May 2002, was valued at about $900 million. In November 2001, meantime, P&G consummated its largest acquisition yet, buying the Clairol hair-care business from Bristol-Myers Squibb Company for nearly $5 billion in cash. The deal melded well with P&G's goal of securing faster-growing, more profitable product areas, such as beauty and hair care.

The biggest changes at P&G were in the growing number of the company's brands and the broadening of its markets. The Procter & Gamble Company (P&G) is a giant in the area of consumer goods. The leading maker of household products in the United States, P&G has operations in nearly 80 countries around the world and markets its nearly 300 brands in more than 160 countries; more than half of the company's revenues are derived overseas. Committed to remaining the leader in its markets, P&G is one of the most aggressive marketers and is the largest advertiser in the world. Many innovations that are now common practices in corporate America--including extensive market research, the brand-management system, and employee profit-sharing programs--were first developed at Procter & Gamble.

P&G’s core strength is its ability to build big, leadership brands. Its success in building brands is based in three factors: understanding customer needs, inventing new product technologies, commercialsing and expanding
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Re: procter and gamble - July 2nd, 2010

check out the interesting docs. related to P&G!!!


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Re: procter and gamble - July 30th, 2010

gud work done..plz post few more reports
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Abhijeet S
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Re: procter and gamble - July 30th, 2010

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Originally Posted by vishubansal View Post
gud work done..plz post few more reports
hey vishal, please mention which reports are you looking for??
so that we can help you more in that..


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Re: procter and gamble - August 30th, 2010

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check out the interesting docs. related to P&G!!!
NICE WORK DEAR....KEEP IT UP......REALLY VERY IMPRESSIVE
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