PROCTER & GAMBLE (P&G)

Procter & Gamble Co. (P&G) is a Fortune 500 American Global Corporation based in Downtown Cincinnati, Ohio. As of mid 2010, P&G is the 6th most profitable corporation in the world, and the 5th largest corporation in the United States by market capitalization, surpassed only by Apple, Exxon Mobil, Microsoft, and Wal-Mart. It is 6th in Fortune's Most Admired Companies 2010 list. P&G has an employee base of 140,000 (2009) people and earned the revenues of US$ 79.03 billion (2009). P&G is credited with many business innovations including BRAND MANAGEMENT the SOAP OPERA and CONNECT & DEVELOPMENT innovation. It manufactures a wide range of consumer goods. In India Proctor & Gamble has two subsidiaries: P&G Hygiene and Health Care Ltd. and P&G Home Products Ltd. It has in its portfolio famous brands like Vicks & Whisper. P&G Home Products Limited deals in Fabric Care segment and Hair Care segment. It has in its kitty global brands such as Ariel and Tide in the Fabric Care segment, and Head & Shoulders, Pantene, and Rejoice in the Hair Care segment. Procter & Gamble's relationship with India started in 1951 when Vicks Product Inc. India, a branch of Vicks Product Inc. USA entered Indian market.

PRODUCTS
Personal & Beauty Care
Cosmetics Oral Care Hair Care

y
  

y
  

House & Home

Laundry Care Dish Soap Snacks & Coffee

y
 

Health and Wellness

Prescription Drugs Health Care

y


Baby & Family

Pet Care & Nutrition

PROCTER & GAMBLE SWOT ANALYSIS

STRENGTH
y y y y New Management Gross Margin 15 Times the Industry Average One of the best marketers in the world Diversified brand portfolio: more than 300 brands with more than 79 billion in Revenue y y y y y y y y Tightly integrated with the largest retailers in the US and around the world Product innovation Talented management Distribute to 180 Countries Distribution channels all over the world New Billion Dollar brands Offers multiple products in each category along with more than one brand Retains strong bargaining positions with retailers

WEAKNESS
y y y Top Brands Losing Market Share Health and Beauty Women Only Lagging behind in online media presence & leadership Missing opportunity: Refuses to manufacture private label products for its retail customers y y y y Slow Process Heavy Culture Views Product Performance only Expansion for brands is limited Increased promotional spending to keep healthy sales

OPPORTUNITIES
y y y y y y y Health and Beauty for Men Doubling Environmental Goals for 2012 Adding Value for the Conspiracy Utilizing online social networks Going Green/Eco Friendly Capitalizing on online media Continue to divest brands that don't align with the company's long-term goals (i.e., Folgers) y y y y y Emerging markets New acquisition opportunities Selling directly to consumers Design for better product experience Has room to expand margins by improving productivity

THREATS
y y y y y y Substitute brands that have a cheaper price Private label growth Slowdown in consumer spending in the US & globally Key competitors expanding their product portfolios through acquisitions Increase in raw material price Commodity cost and currency exchange rate placed tremendous pressure on the business y Increase of regulations

MARKETING MIX
Product
Beauty and Grooming Brands Products in this category include Gillette, Olay,

Health and Well Being Brands Products in this brand category include Oral-B, Vicks etc.

Household Care Brands Brands in this category are Ariel and many more. All these products are produced with greater variety in between them. For instance, Safeguard which is soap has soaps of different varieties like safeguard white and safeguard pink. P& G manufactured products are popular for their excellent packaging and design, features and strong brand name.

Price
In 1990s era, P&G incorporated value pricing strategy. The company adopted this strategy by cutting its coupon, production and logistical cost by effectively increasing efficiency and it increased its advertising by 20 percent. Within the period of six years this strategy resulted in higher brand loyalty and stronger brand image. The strategy of P&G was quite opposite to that of competitors and marketing practices on that time but resulted in greater success. Now days, P&G has the most effective pricing of its brands and customer loyalty is as enough that they are willing to pay extra for companys brands. P&G gives discount offers on its different products time to time but not frequently as it experienced in 1990s that coupon and discount only decrease customers brand loyalty (Whereby, 2006).

Place
P&G products are available almost all over the world. P&G distributes the products in about 140 countries to approximate five billion consumers. DHL courier is a service provider to the company through which it ensures its logistical efficiency. Company has manufacturing and distribution networks in all major countries where it runs its operations like China, USA, UK and India.

Promotion
This era is an era of advertising. Companies have to do huge advertisings to sell their products to the consumers. P&G has an effective promotions strategy with an advertising budget of approximately 8.68 billion dollar in 2009 which makes it worlds number one advertiser (Mikkelson, Barbara and David, 2005). P&G received Advertising Hall of Fame Award in 2010. The company uses television mass advertising in particular, Internet marketing and other marketing mediums to promote its brands.

COMPANY STRATEGY
We are focused on strategies that we believe are right for the long- term health of the Company and will deliver total shareholder return in the top one-third of our peer group. The Companys long-term financial targets are: y Grow organic sales 1% to 2% faster than market growth in the categories and geographies in which we compete, y Deliver earnings per share (EPS) growth of high single digits to low double digits, and y Generate free cash flow productivity of 90% or greater.

In order to achieve these targets, we have created one over-arching strategy, inspired by our Purpose. At the heart of this strategy is innovating to win by touching and improving the lives of: y

More Consumers. We are improving more consumers lives by innovating and

expanding our product portfolio vertically, up and down value tiers. We continue to successfully develop and launch premium innovations focused on improving consumer value through enhanced performance. We are also serving consumers who are more price conscious through lower-priced offerings with superior performance versus other mid-tier and value-tier alternatives.

In More Parts of the World. We are improving lives in more parts of the
world by innovating and expanding our existing product portfolio geographically into new markets. We are increasing our presence in developing markets and increasing the amount of sales from these markets by focusing on affordability, accessibility and awareness of our brands.

More Completely. We are improving lives more completely by innovating to

improve existing products and creating or entering adjacent categories. We are driving regimen use that broadens the occasions for which our brands can serve the needs of each consumer. By attracting new consumers into our existing brand franchises and broadening the products used by our current consumers, we are able to build scale, reduce costs and profitably grow market share.

Hindustan Unilever Limited (HUL)

Hindustan Unilever Limited (abbreviated to HUL)) formerly Hindustan Lever Limited, is Indias largest consumer products company and has an annual turnover of over Rs 13,000 crore (calendar year 2007). It was formed in 1933 as Lever Brothers India Limited and came into being in 1956 as Hindustan Lever Limited through a merger of Lever Brothers, Hindustan Vanaspati Mfg. Co. Ltd. and United Traders Ltd. It is headquartered in Mumbai, India, has employee strength of over 15,000 employees, and contributes for indirect employment of over 52,000 people. The company was renamed in late June 2007 to Hindustan Unilever Limited. In 2007, Hindustan Unilever was rated as the most respected company in India for the past 25 years by Business World, one of Indias leading business magazines. The rating was based on a compilation of the magazines annual survey of Indias Most Reputed Companies over the past 25 years. HUL is the market leader in Indian consumer products with presence in over 20 consumer categories such as Soaps, Tea, Detergents and Shampoos amongst others with over 700 million Indian consumers using its products. It has over 35 brands. Sixteen of HULs brands featured in the AC Nielsen-Brand Equity list of 100 Most Trusted Brands Annual Survey (2008). According to Brand Equity, HUL has the largest number of brands in the Most Trusted Brands List. Its a company that has consistently had the largest number of brands in the Top 50 and in the Top 10 (with 4 brands). Hindustan Unilever distribution covers over 1 million retails outlets across India directly and its products are available in over 6.3 million outlets in India, i.e. nearly 80% of the retail outlets in India. It has 39 factories in the country. Two out of three Indians use the companys products and HUL products have the largest consumer reach being available in over 80 per cent of consumer homes across India. The Anglo-Dutch company Unilever owns a majority stake (52%) in Hindustan Unilever Limited. HUL was one of the eight Indian companies to be featured on the Forbes list of Worlds Most Reputed companies in 2007 .

PRODUCTS
FOOD BRANDS
            Brooke Bond 3 Roses Annpurna Brooke Bond Red Lebel Brooke Bond Taaza Brooke Bond Taj Mahal Bru Kissan Knorr Kwality Walls Lipton Modern Brooke Bond Sehatmand

HOME CARE BRANDS

        Active Wheel Cif Comfort Domex Rin Sunlight Surf Excel Vim

PERSONAL CARE BRANDS

           Aviance Axe LEVER Ayush Therapy Breeze Clear Clinic Plus Closeup Dove Fair & Lovely Hamam Lakme

      

Lifebuoy Liril 2000 Lux Ponds Rexona Sunsilk Vaseline

WATER
 Hindustan Unilever-Pure it

MARKETING STRATEGIES ADOPTED BY HINDUSTAN LEVER

The company handed over the marketing for vim to O&M in Maharashtra and Andhrapradesh .

O&M rural marketers adopted unique strategy in the initial stages to market the product in rural areas Maharashta and Andhrapradesh.

As the marketers knew that it was the initial stage in rural areas and to provide a niche in the rural markets was difficult as the product itself was not available in this areas.

First to target the market in rural areas they saw to it that the market which they are targeting was in the 2 to 3 km range from the highways because they knew it wont create sense to market the product in those areas which are away from the high ways as the product was not available in those areas.

The overall marketing was based on district-to-district level. They had thought to enter in other areas beyond the 2to3km range after making the product available to the initial targeted market.

So that it becomes easy for the marketers to introduce, as the product was available in the neighboring villages and the product becomes familiar to the people.

PROMOTIONAL STRATEGY
This strategy was used at village to village basis

In the process of promoting vim in rural areas. Keeping into mind The dynamics of rural consumer and distribution infrastructure, the marketer had adopted a different promotion strategy to promote the vim in rural areas.

The

formal

media

used

to

communicate

the

product

was

T.V,

radio

cinema ,print proportionately depending upon their reach and their influence on rural masses.

The informal promotion strategy was formulated. The steps involved to promote the product in rural areas.

The first step was the usage of audio- visual publicity vans. This publicity vans were covered by beautiful banners, this banners were embossed with the product photos, the base or tagline of the product and colorful picture that can attract the rural consumer. The audible material used were a tunes of current filmy songs, which were composed with new lyrics, this lyrics gave the special features about the vim. This step was used as an introduction of the product vim in rural markets.

The second step in the promotion strategy was to do Door-to-door marketing. This step was very well designed. To do Door- to- door marketing the marketer employed the young local youths who can communicate with rural people in the local language. This youth carried along with them flip charts as a substitute medium to T.V.

This flipchart contained a story. The story used in the flip chart was about two female named Kamala and bimla. Explaining that kamala used vim and bimla used other proxy product. Kamala showed bimla the benefit of using vim in compare to other proxy product and explaining the features of the product. The Door-to-door marketing step was complementary to other step that involved the participation of the rural housewives, which contained games. This games were strategically designed so as to position the product and the price of the product in the minds of consumer.

The games used were

Spotting the right price.

Match the pairs.

Turn the wheel

This games were used to entice the people and pull them to mohalla the small place between the houses so as to do mass marketing as much as possible. This all was done as process of mass marketing.

The fourth step in promotion was Retail contact

In this step the marketers gave scratch coupons to the consumers who came to purchased vim with incentive packages (i.e. packages one for two). The price given were on the.

The prizes distributed to whom so ever won was 12months soaps. Prizes were distributed on the spot so to create better perception of the company and product in the mind of the consumer. The same was made applicable for the retailers on the bulk purchase. This retailers were also given special discount on their bulk purchase.

The final step was that all the people were invited to the central location. This central location was usually a place were all the village people assembled so that becomes easy to communicate at large to the masses. The activity undertaken at the central location was cleaning up the sweet makers vessels, which was the toughest to do.

It was communicated as

Saf kare mitaheewale ki kadai

This exercise of promoting the product was one of the best as when it was proved in front of the consumer as vim cleaned the mitaheewale ki kadai without living any greasiness. The advantages of the Vim were also shown to them.

The advantages of vim were that it relieved from the hardship of scrubbing the vessel, which was done with ease with the help of vim. The other advantage was that it would

certainly save their lot of time, which can be utilized effectively for some other work. This created a clear perception about the product. This process was used again and again in capturing different markets.

The other promotion strategy to promote the product Roadshows comprising attractively designed floats will traverse the length and breadth of the country during the time span of the offer. The carnival, which will cover hundreds of small towns and villages apart from the metros and is part of a massive rural promo initiative that HLL plans to unleash.

The company even had to promoted the product in Haats & Melas of different villages.

To

promote

the

vim

HLL

planned

to

distribute

gold

as

prize

IN a bid to promote vim one of its leading dishwash soap, Vim Gold Bar, HLL had launched a below-the-line advertisement.

This medium proposes to bring Vim to the rural households via direct interaction between customer and producer.

This promotional blitzkrieg across the country includes giving away gold worth Rs 5 crore.

The offer gives; customers stand a chance to win gold in different denominations by just scratching a card received on every purchase of a Vim bar.

Each scratch card carries an 8-digit number. Every Sunday, one such number will be announced on Sony Entertainment TV between 8-9 p.m. and this number will be valid for the entire period of the offer.

If the number on the scratch card of the consumer matches with the number announced on TV, they would be eligible for a 400 gm gold bar - the weight of the Vim bar in gold.

In case of fewer digits matching, the consumer stands to win 100 gm, 10 gm, or 1 gm of gold or Rs 100 off on purchase of HLL products from the retailer

Communication
Vim Bar has always created an impact in the market with its path-breaking communication. The communication has been designed to powerfully communicate the tough stain removal properties of the Vim Bar. HLL created a new consumer lingo for the tough stain problem with the campaign baseline of Vim being the Khar Khar ka moh tod jawab.

HLL had to completely change its communication when it entered into rural it had to completely changed its communication from the previous one that was that after cleaning the vessel with bar you can see your fac(apka chehra

Bhi dekha ga saf) to (khar khar ka moh tod jawab) just because the rural consumers used aluminum vessels to cook their food. It wont create sense to appeal them to buy that product that did not suit their living.

HINDUSTAN UNILEVER DISTRIBUTION STRATEGY

At present, HLL's products, manufactured across the country, are distributed through a network of about 7,000 redistribution stockists covering about one million retail outlets. Extending availability Data on rural consumer buying behaviour indicates that the rural retailer influences 35% of purchase occasions.

Therefore, sheer product availability can determine brand choice, volumes and market share.

HLL used the principle of project stream line .The principle of Project Streamline is to leverage our scale and organizational synergy to increase reach in rural markets.

The pivot of Streamline is the Rural Distributor (RD), who has15-20 rural sub-stockiest attached to him. Each of these sub-stockiest is located in a rural market. The substockiest then performs the role of driving distribution.

Project Streamline was conceptualized to significantly enhance control on the rural supply chain through a network of rural sub-stockiest, who are based in these very villages.

As part of the project, higher quality servicing, in terms of frequency, credit and full-line availability, would be provided to rural trade. Thereby, giving us a substantial competitive edge over the next decade

The role performed by the Redistribution Stockiest has also undergone changes over the years.

Financing stocks, providing manpower, providing service to retailers, implementing promotional activities, extending indirect coverage, reporting sales and stock data, screening for transit damages are some of the functions performed by the RS today.

The RS was required to provide the distribution units to the company salesman. The RS financed his stocks and provided warehousing facilities to store them. The RS also undertook demand stimulation activities on behalf of the company.

The RS would be able to provide customer service only if he was serviced well. This knowledge led to the establishment of the "Company Depots" system. This system

helped in transshipment, bulk breaking, and as a stock point to minimize stock-outs at the RS level.

In the recent past, a significant change has been the replacement of the Company Depot by a system of third party Carrying and Forwarding Agents (C&FAs). The C&FAs act as buffer stock-points to ensure that stock-outs did not take place.

The C&FA system has also resulted in cost savings in terms of direct transportation and reduced time lag in delivery. The most important benefit has been improved customer service to the RS.

Certain C&FAs were selected across the country to act as mother depots. Each of them has a minimum number of JIT depots attached for stock requirements. All brands and packs required for the set of markets which the MD and JITs service in a given area are sent to the mother depot by all manufacturing units. The JITs draw their requirements from the MD on a weekly or bi-weekly basis.

Consumers: Making a difference through our brands

Despite advances in science and increasing prosperity, millions of people still lack access to basic sanitation, nutrition and healthcare. We believe that our brands can grow by addressing some of the most important social and environmental challenges facing the country today. In 2005, we started to embed the sustainability agenda into our brands by using a process called Brand Imprint. It is a rigorous, diagnostic process that analyses the social and economic value, as well as the negative impacts of a brand. This process has been carried out across all our key categories. Social and environmental considerations are now integrated with innovation plans for our major brands. We believe we can make a difference through our brands and behaviour change campaigns in the space of nutrition and hygiene, and by providing consumers, from all income groups, access to a better life.

Hygiene
Our brands can make a difference but achieving lasting improvements depends on people changing their everyday habits.

Nutrition
We are improving the nutritional quality of our food products and encouraging consumers to live healthier lives.

Well-being for all

People everywhere, whatever their income level, aspire to use high-quality and innovative products.

Product responsibility
Product safety and responsible marketing communication