PROCTOR & GAMBLES

Proctor & Gambles

Proctor & Gambles

Q. What have been the key success factors for proctor and gamble?

P&G is the mission-oriented organization, directed main towards its vision. Company always tries to look forward to remain the market leader. The key successful factor of P&G is that it occupies a leading position in the market of consumer goods sales and a number of other indicators. It needs to decide where to position its product on the quality and price as well as considering other factors in setting its pricing policy such as wages, rent, interest or profit, or mark distinguishing characteristics of the product. These are the things that tend to make prices more rigid, i.e. less sensitive to changes in supply and demand. Therefore, the price is a basic controller in the economic system because it affects the distribution of these inputs. In addition, there are some psychological aspects of the price that must be taken into account by marketing executives as the fact that consumers rely heavily on price as an indicator of product quality.

Distribution Strategy

P&G's markets are characterized by intense competition. The company has always competed with well-established companies such as Colgate-Palmolive and Unilever. For instance, Unilever is currently undergoing restructuring and has enough marketing potential to pose a significant threat to P&G in most of its markets.

The core aim of any successful firm is entirely relying on its distribution channel. How fast and how well it transfers its product to the end user. The act of spreading or apportioning of goods and services to those with a demand or need for them is referred to as distribution. To go to market, producers of services and products create at least one channel of distribution, or path, through which they access a potential buyer, convert the prospect into a customer, and fulfil the orders the customer places. The importance of distribution strategy in P&G is those channels members are collectively earning margins that account for 30 to 50% of the final selling price. In contrast, advertising typically accounts for less than 5 to 7% of the final price. The importance of the distribution function is not due solely to the accounting costs of the channel's activities. Marketing channels represent a substantial opportunity cost. Finding the potential buyer and converting mere potential into profitable orders from paying customers is a major part of the channel's role. The marketing channel does an immense deal not only to serve the market, but also to make the market. (Teresko, 2004, 30)

In general, P&G now recognize that channels perform eight key functions as they interface between suppliers and markets: taking title (ownership); taking physical possession (stewardship); promotion; negotiation; financing; risk taking; ordering; and payment. Along the way, channels achieve competitive advantage by providing support services after the sale and by composing appealing assortments (assortments of products and services to offer to buyers, assortments of potential buyers to offer to suppliers). In short, channels make markets and execute transactions by bringing potential suppliers and ...