Procter & Gamble is the largest company in consumer care segment. The company has more than 171 years of existence and has diversified products and services. The company has acquired different companies to become the largest consumer care company in the world. This report will look into Procter and Gamble and how it has performed in the industry. The following are the main objectives of this report:
i. To understand history of Proctor and Gamble
ii. To understand the business strategy that has been used by the company in the market
iii. To understand marketing strategies employed by the company
iv. To make recommendations for future growth
I. Company Overview
Proctor & Gamble is a company registered in the NYSE as PG. It is also among Fortune 500 American multinationals corporations.The company operates in different continents but it is headquartered in Downtown Cincinnati, Ohio. Proctor & Gamble manufacture different types of consumer goods. Proctor and Gamble is the 6th listed in the Fortune's Most Admired Companies in 2010 (CNN Money). The company is also credited with different innovations including brand management and soap opera.
In addition, Proctor & Gamble is also a member of the U.S Global Leadership Coalition. This is a coalition based in Washington that includes more than 400 major multinationals and NGOs involved in campaign for a larger international affairs budget (U.S Global Leadership Coalition). The funds realized from this coalition are used in American diplomatic efforts in the world.Therefore, this coalition is meant to ensure that there is increased government diplomatic relations with the world in order to prepare the best environment to operate their businesses in.
Proctor & Gamble started way back in 19th century by William Procter, who was a candle maker and James Gamble, who was a soap maker. Both were immigrants who came from England and Ireland respectively and settled in Cincinnati. Both were lucky after marrying sisters, Olivia and Elizabeth Norris. There father-in-law, Alexander Norris called his sons-in-law and suggested to them to form a company. They all agreed and in 1837, Procter & Gamble was born.
The company grew rapidly and by 1859, the company had sales skyrocketing to million. The company had also employed about 80 employees and during the American civil war, Procter and Gamble won different contracts to supply Union Army with soaps and candles. The war had positive impact on the company as it increased profits as more and more soldiers were now introduced to products from Procter & Gamble.
The company already understood the importance of research and development. In 1880s, it researched, developed, and marketed a new soap product that could float in the water, Ivory brand. It also started one of the earlier management practices when William Arnett Proctor, who was William Procter grandson, began profit-sharing program with the company employees (The Marketing Doctor). The workers acquired a stake in the company and they in return supported the company on all its endeavors.
With the support of the workforce and rising sales, the company started building different factories in different locations in the United States as the demand for the products outdone the capacity of the Cincinnati factories. At the same time the company began diversifying its products. In 1991, the company began producing Crisco, which was a shortening that was made from vegetable oils and animal fats. During the 1920s and 1930s, the radio was invented and it became a popular media. Procter & Gamble realized the marketing opportunity presented by the Radio and started sponsoring different programs. All these shows that were sponsored by Procter & Gamble came to be known as "soap operas"
In 1930s, the company also became an international company started internationalization program way before the wave of globalization and enterprise internationalization came to reality. In 1930, it acquired Thomas Hedley Co. Procter & Gamble had strong links to North East of England after it had acquired this company. Over the time, the company developed different new products and brand name and the company began to reach new eras. It introduced "Tide" laundry detergent around 1946 and "Prell" shampoo introduced in 1947. The company began selling its first toothpaste containing fluoride, "Crest", in 1955. In 1957, the company bought Charmin Paper Mills making its debut entry into toilet paper and other paper based products. In 1960s, the company introduced "Downy" a fabric softener and "Bounce" fabric softener sheets in 1972. However, the most revolutionary product for the company was "Pampers" that was introduced in 1961. Although Johnson &Johnson had introduced a similar product earlier, it did not do well in the market like Pampers.
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