PG Professor Carl Mela Marketing 460 Product Management

P&G Professor Carl Mela Marketing 460 Product Management Fuqua School of Business • Brand Management System • On Building A Brand • Managing Across Brands P&G– 1

P&G Options • New Brand – Niche – Performance – Mild • Reformulate – Ivory – Dawn – Joy • Reposition Joy • Increase Advertising for Ivory P&G– 2

P&G - What Happened? • H 80 test marketed as Cinch • Results short of expectation – Fell 25% short of share objectives • Lack of follow up support • Overly harsh, not sudsy, “liquid sandpaper” P&G– 3

P&G - What Happened? • Modified in revised test market – Ad copy focused on tough jobs – Package from green to white – Lighter color, more suds – Endorsement from Corning - would not scratch – Volume objectives cut 33% P&G– 4

P&G What Happened • Trial 40% greater than 1 st test market • Never reached 11% sales goal • Reasons – Growth of Dawn and Sunlight – Consumer attitudes highly polarized P&G– 5

P&G What Happened • Organization 2005 – Much like 1981 with • Global regions folded into product organization • Yet sales department by region – Matrix failed, regional failed • Issues of coordination and silos • Committees coordinate now – Contrast with Samsung • Region like MDO • Product like GBU (however, central global brand) P&G– 6

P&G Take Aways • Product manager’s role and logic for that role – Importance of marketing – Accountability • Decisions brand managers make – P&L – Marketing plan P&G– 7

How Has P&G LDL Changed? • Org structure very similar • Business Review => Marketing Plans process • P&G brand portfolio has dramatically shifted to HABA • P&G LDL portfolio unchanged P&G– 8

How Has the LDL Market Changed? • • • Category continues to shrink Consumer pref. roughly same Competitive set has shrunk Adjacency launches have failed Price pressures are intense P&G– 9

Current Strategy • Dawn – 3 Tiers of Performance • Joy – Value Clean • Ivory – Hand Mildness P&G– 10

Dawn P&G– 11

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P&G Performance New Wal-mart Inventory Policy P&G– 13

Exercise • What are key challenges related to regionalization facing P&G today? • Then, let’s hear directly from P&G! P&G– 14

Pantene Relaxed & Natural Packaging Issue: The North America Pantene Brand is planning to introduce a line of products targeted to African. American women. This collection will be called Relaxed & Natural. As you (ABM) develop the proposition, you are faced with a packaging decision. Should you use the base Pantene (pearl white) package color or design a different package color (tbd)? P&G– 15

Discussion Questions • How would you (as an ABM) approach this decision? • What are some of the questions you would ask? • Any thoughts on how you would come to a decision? • Who do you think should have the final say? P&G– 16

What Happened? • ABM and team conducted research / obtained input – consumer groups – customer calls – copy testing (via the verbatims) – internet package design assessment test – shelf tests • BM and Marketing Director consulted and managed the GM and Global Franchise Leader’s expectations P&G– 17

What Happened? • ABM presented the recommendation to GM • GM aligned the Global Franchise Leader to the recommendation • The GM and Global Franchise Leader presented the recommendation to the Hair Care President for final approval as a part of the launch plan agreement (LPA) P&G– 18