Proctor & Gamble
1. What is Proctor & Gamble’s corporate strategy? Do the company’s businesses seem to be related or unrelated? Are Gillette’s businesses closely related to P&G’s businesses? How will a merger with Gillette provide a 1 + 1 = 3 effect for P&G?
Proctor and Gamble recently completed large restructuring, put new management in place, and cut capital spending needs. Since then they are now focused on increasing top and bottom line results after shifting business mix toward higher margin, less capital-intensive health and beauty care sectors and also gearing towards developing markets and lower-income consumers.
Most of the company’s products are closely related in the sense that they are household products such as Always, Bounty, Braun, Charmin, Gain and Tide. However, there are a few product lines that are completely unrelated like Actonel prescription medication, and newly acquired Duracell batteries and Iams Cat and dog food. They are all related by the fact that 23 brands of P&G and Gillette together make up more than a billion dollars in net annual sales and another 18 have sales between $500 million and $1 billion. Some of their top selling products include:
• Always is a brand of feminine hygiene products, including maxi pads, pantiliners (sometimes called Alldays), and feminine wipes, produced by Procter & Gamble.--See also Brand homepage; related trademarks: Ultra Thins; Flexi-Wing; Maxis; Alldays; CleanWeave.
• Ariel is a brand of washing powder/liquid, available in numerous forms and scents.
• Actonel A brand of Osteoporosis drug Risedronate.
• Bounty is a brand of paper towel sold in the United States, Canada. P&G sold the brand in the British Isles.
• Braun is a small-appliances manufacturer...
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Although Lafley has had success, the underlying problem remains. How will Lafley return P&G to its rightful place in Corporate America? P&G's solution to its problems is through product line extensions, expansion into non-premium brands, as well as acquisitions, licensing, reinforcing market orientation through consumer focus, and outsourcing. This recommendation was based on following items;
Scope was introduced in 1967 by Procter & gamble, which is one of the most successful companies in the world. P&G philosophy is to provide superior quality and value that best fills the needs of the consumers; it was recognized as a leader in the Canadian packaged good industry.
Wire, B. (2003, April 9). BNET. Retrieved February 22, 2008, from BNET Business Network: http://findarticles.com/p/articles/mi_m0EIN/is_2003_April_9/ai_99819475
Lefton, Terry (2009, Jan 19). NFL close to adding P&G to sponsor list. Retrieved July 15, 2009, from
Proctor and Gamble was founded in Cincinnati, OH, by William Proctor and James Gamble in 1837. Initially the company was started to compete with the 14 other soap and candle makers already established in Cincinnati, but around the end of the century, Proctor and Gamble dropped candle manufacturing altogether to focus on soap production. By 1890, Proctor and Gamble had increased their production to over 30 different types of soap.
Roll Global. (n.d.). Who we are Building healthy brands from the ground up. Retrieved from Roll Global: http://www.roll.com/who-we-are
Colgate-Palmolive (CP), the leading retail toothbrush manufacturer in the United-States is looking to expand its market share by entering into the competitive high-end toothbrush market segment with the introduction of its technologically innovative Precision. Though the product's introduction promised highly profitable returns, it also presented Colgate with a number of challenges including a significant financial investment, fierce competition, manufacturing limitations, and potential cannibalization. After assessing the company's positioning in the market with the consumers perception of the colgate brand and the nature of its competitors SWOT and market share, CP is faced with the decision of how to position, brand, and communicate the Precision advantage to the market. This must be done without a detriment to the already existing product's market or profit. The proposed strategy will conform to the stated corporate goals and mission statement of CP while maximizing long-term profit gain.
This is the second of three reports I will complete as part of the strategic analysis of Pfizer. This report focuses on strategy analysis and includes the following sections. First, the major concepts related to generic, corporate and international strategies analysis will be defined. Second, those concepts will be applied to the case of Pfizer in order to analyze its strategies. The analysis of Pfizer will be followed by its evaluation to identify the major problem the company is facing and propose a solution that Pfizer can adopt. A short conclusion will close the report.
In 1991, CP launched new products in the U.S market CP and held 43% of the world toothpaste market and 16% of the world toothbrush market. Other oral care products included dental floss and mouth rinses. In 1991, worldwide sales of CP's oral care products increased 12% to $1.3 billion, accounting for 22% of CP's total sales.
Once America’s most innovative consumer products company, Procter and Gamble (P&G) started by selling soaps and candles in a small Cincinnati storefront in 1837 (Procter and Gamble, 2008). After a hundred and seventy-one years P&G has grown to over one hundred household brands in over eighty countries (Markels 2006). Their products range from air fresheners to prescription drugs. However, as P&G headed into the twenty-first century they announced that they would not be meeting their 1st quarter earnings forecast [Lafley, 2003]. Revenue margins were dropping and P&G was quickly losing market share to Kimberly Clark and Johnson & Johnson. After missed earnings P&G’s stock price fell from $59.18 to $26.50 between January 2000 and March 2000 (PG). Upset, the board of directors pressured then CEO Durk Jager to resign after a lack luster attempt at turning P&G around and replaced him A.G Lafley, an unproven CEO, whom analysts felt lacked the experience to give P&G a much needed clean up (Lafley, 2003).
Competition: Competition in the Toothbrush market for Colgate Palmolive was tough. Competition by segments. Value segment: Level (7.2% by volume of total market shares in 1991), Pizar and Sunstar. Professional segment: Johnson & Johnson (19.2% by volume of total market shares in 1991). Super-premium segment: Oral-B (23.1% by volume of total market shares in 1991), Procter & Gamble and Smithkline Beecham (0.9 % by volume of total market shares in 1991). Oral B's brushes were positioned in the super premium segment. Where it had no strong competition for the moment since Johnson and Johnson, with its Reach brand focused only on the professional segment.
P&G is an international and famous consumer goods founded in United States by Williams Procter and James Gamble both from the United Kingdom since 1837 about 177 years ago. P&G manufactures diversified range of product such as personal care, cleaning items, beauty product, pets food, drugs, & other beverages. Their products are sold in more than 180 countries around the world through grocery and departmental stores and retailers. They are also among the world’s most profitable consumer product company, with highest amount of sales. Their products are recognized in most part of the world. Their company have an organizational strategy to touch the live of its employees which is the major strength and competitive advantage of the company.
Pfizer growing strategy for the last decade is by mergers, such as Warner–Lambert (2000), Pharmacia (2003), and Wyeth (2009). The firm strategy to grow by mergers can cause even greater potentially additional risks, not just strategic risk. Some people believe when firm is not growing organically, thus cannot sustain its competitive advantage in the long-term. In pharmaceutical industry we believe M&A are crucial to exploit economies of scope (R&D synergies) and importantly, not causing trademark infringement with potentially similar new drugs. On the other side, Pfizer experiences with numerous mergers are seen as an “asset” to reducing risk to minimum. Simply they know where and how can they create
Colgate Palmolive is the current leader in manufacturing and distribution of oral care and general hygiene products in the world (Crescendo Networks, 2011). Almost all households on the globe use a product of Colgate Palmolive. The success story of Colgate Palmolive started way back in 1873 when its founder, Mr. Colgate, started the company, and ever since, the company has been rising in the corporate world to achieve its current position. However, this does not mean that all has been well throughout. Each business environment has challenges that businesses have to overcome to remain competitive. This is mainly done by formulating and adopting effective strategies that will not only help to overcome the challenge but also to enhance creativity and innovation. At Colgate Palmolive, innovation is highly encouraged and practiced which explains its broad range of products.