Procter and Gamble Marketing Strategy
Procter and Gamble (P&G) are one of the leading companies in the packaged goods industry with products and sales stretching around the world. In fact, P&G is the world’s biggest advertiser in terms of dollars spent per year and their marketing strategies have been copied by many other corporations as a way to copy their success.
Founded in 1837, Procter and Gamble began when a candlemaker and soapmaker who had married sisters decided to combine forces. By the outbreak of the American Civil War in 1861, P&G sales were over $1 million a year. The company has flourished thanks to innovative products, exceptional employee relations and a knack for choosing innovative marketing strategies.
Today, P&G is a multinational company that carries a great number of consumer goods ranging from cleaning agents, personal care items, and pet foods. In 2012, P&G earned nearly $84 billion in sales and ranks in the top 20 of “Most Admired Companies in the World”.
P&G Marketing Strategies
Procter and Gamble have employed many different types of marketing strategies over the years with varying results. The majority of the marketing budget for P&G goes into more traditional advertising measures such as print and TV advertising. It is true however that some marketing budgets may be tougher to discern in the face of maintenance issues. For example, digital marketing budgets often include website operations and social media marketing which are generally incorporated into other budgets.
Of the many different marketing strategies that P&G has deployed over the years, one of the more interesting is an emphasis on higher-end items for many of their standard products. In 2013, P&G introduced new, higher prices for some of their consumer brands, most notably paper towels that have met with mixed results.
In fact, P&G is now offering lower prices on many of their consumer products, which may be an indication that this particular marketing strategy is being altered. However, it is the fact that P&G were willing to try out new ideas that helps separate this company from the competition.
Emphasis on Digital Marketing
It an interview with the chairman of Procter and Gamble in August, 2013, the percentage of their marketing budget dedicated to digital was an astounding 35%. P&G spend nearly $3 billion in advertising each year, so the amount spend on digital marketing is enormous, especially for a company that emphasizes packaged goods. The digital marketing includes more social media, online video, mobile and search oriented marketing.
The reasoning behind the emphasis on digital marketing lies in their overall switch from standard promotional techniques to innovation. Brand equity is the new focus for P&G by providing products packaged in 100% recycled materials that reduce the carbon footprint and eventually create no waste that goes into landfills.
In fact, as part of P&G’s marketing effort the amount of laundry loads using cold water rose from 38% to 50% around the world with most of the rise in Western Europe thanks in part to P&G’s marketing towards environmentally conscious solutions.
By embracing new marketing ideas and backing it with the hefty resources of the company itself, Procter and Gamble are a prime example of how innovative marketing strategies can create a powerful company.