Marketing Strategy Analysis of Procter & Gamble (P&G) - Report

This report provides a comprehensive analysis of Procter & Gamble's (P&G) marketing strategy. It begins with a marketing audit, evaluating P&G's performance and comparing their marketing plan with actual market outcomes. The report then utilizes PESTLE analysis to assess the brand's interaction with political, social, legal, and regulatory forces, highlighting its effective market coverage as a strength. A SWOT analysis identifies market coverage as a key strength and the presence of counterfeit products as a significant weakness. The report further examines P&G's customer-centric approach, investment in research and development, and utilization of technology. The analysis includes discussions on competitive advantages, SMART objectives, and the development of a marketing strategy based on the marketing mix. The conclusion synthesizes the findings, offering insights into P&G's market position and strategies for continued success in the consumer goods industry.

MARKETING STRATEGY

EXECUTIVE SUMMARY
A comprehensive and efficient marketing strategy formulates the basis of an effective
marketing plan. The marketing department of P&G is operating for improvement of the
company, further to attain the aims and objectives. Undertaking marketing audit of the corporate
shall compare the marketing plan of P&G with the actual performance they have reflected in the
market. With the assistance of PESTLE Analysis, it can be said that the brand is functioning in
an efficient condition and is efficaciously interacting with the forces of Political, Social, legal
and regulatory framework. The marker coverage of P&G is highly exponential, and this can be
considered as the strength of the company, whereas existence of fake products in the market is
the biggest weakness which is being faced by the company. The management of the entity is
open to alter everything in the company for achieving greater heights, except the core principles
and values which forms to be the fundamental to everything. In consequence to the same it has
been tagged as one of the largest and fastest growing enterprises. The brand has developed
SMART objectives to be achieved through deployment of an effective marketing strategy on the
basis of the marketing mix.

TABLE OF CONTENTS
INTRODUCTION...........................................................................................................................1
PART 1............................................................................................................................................1
Marketing Audit of the Company...............................................................................................1
SWOT Analysis of P&G.............................................................................................................3
PART 2............................................................................................................................................6
Segmentation targeting and positioning .....................................................................................6
SMART Objectives and Goals....................................................................................................7
Developing a marketing strategy on the basis of relevant marketing mix..................................8
CONCLUSION ...............................................................................................................................9
REFERENCES..............................................................................................................................10

INTRODUCTION
Marketing Strategy of an organization is fundamentally based on an intense research of
the trends of the market as well as the change in the requirements. A comprehensive and efficient
strategy formulates the basis of a marketing plan. It lays the foundation of achieving maximum
profits and sustain in the market at a satisfactory position. Hence, it reflects all the goals and
targets which a management has ascertained for their corporate. The primary focus of an
efficacious marketing strategy is to develop a right product mix, is order to realize the
ascertained aims and objectives.
In the present study, marketing strategy of Procter and Gamble (P&G) shall be
understood and analyzed. It is an American Multinational Company which is operating to
provide consumer products related to cleaning, personal care and so on (P&G. 2014). On the
basis of these products, it has developed a good name of its brand across the nations of the world.
Some of the specific areas which have been covered in the study is that of marketing audit of the
company, SWOT Analysis and many such areas which enables the author to determine the
present position of the company in the market.
PART 1
Marketing Audit of the Company
Marketing Audit is one of the most beneficial ways to ascertain the manner in which a
company is performing and functioning. The marketing department of P&G is operating for
betterment of the company, further to achieve the aims and objectives. In essence undertaking a
marketing audit involves a comparison of the marketing plan of P&G with the real performance
they have achieved in the market (Bruwer and Johnson, 2010). The process of evaluation of the
firm is categorized into the following key areas:
 External Marketing
 Internal Marketing
Hence, the manner in which P&G is carrying on its operations in the external
environment is studied. It is constituted of elements such as Customers, Competitors, political
scenario and so on. Hence, an analysis of all the mentioned elements shall be carried out in
addition to the analysis of the internal system.
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 Legal and Political: There are various legal and political factors which play an
imperative role in determining the manner in which a company is performing. The legal
environment imposes certain rules and regulations which direct the working of the
companies in a particular manner (Chiu and et. al., 2006). P&G is required to abide by
the provisions of various statues related to employment laws such as Health & Safety,
Employment Contract, Equal Opportunities and so on, in addition to industry specific
legal requirements. The management of the company is also required to stay updated with
all the amendments and incorporate the same to avoid any legal liability. Also the
political scenario of the nation poses various kinds of threats and opportunities of a firm.
For instance Brexit has already shown its effects on the market and is set to bring about
major changes in the manner the UK market functions. Competitors: The industry in which P&G is working has immense competition to survive
at the position where the company is currently functioning. A fierce competition is faced
by some of the leading brands of Unilever, Johnson & Johnson and so on. In pursuance to
the same, the management has adopted the strategy of innovation which in turn has
provided a sound position to the company in the industry (Kotler and et. al., 2015). Customers: A very important role is played by this element, and this is well understood
by the management of P&G. They have inculcated a customer-centric approach which
can be established from the fact that it is considered as one of the largest consumer
researchers. Moreover, it invests about $2 Billion for carrying out the Research and
development activities, on an annual basis. Technological: All the activities of the business are based on utilization of advanced
technology, and has enabled the company to maintain the level of innovation in all its
product. Also the promotional activities of the company are made more effective with the
use of latest technology. In addition, with the help of this it maintains an effective
communication and relationship with all its stakeholders (Rosenbloom, 2012).
PESTLE Analysis Political: The political scenario around the brand has been quite favourable, and in
pursuance to the same the company has been functioning smoothly. However, in general,
the political scenario of any nation has a direct influence on the operations of the
company.
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 Economical: It faces intense competition at global and local level, and was highly
effected by the last economic recession. Social environment: The company has a highly inclusive work environment, and the
manner in which it interacts with the society is also highly commendable. It targets the
group of personal, household and consumer products. It embraces different cultures and
ethnicity to capture an increase number of market share. Technological: All the operations are based on high end technological machinery and
equipments, to realize advanced level of production.
 Legal and Regulatory: It stays in compliance with all the applicable rules and
regulations. Such as Employment Rights Act, Equal Opportunities act and so on.
 Environmental: The products developed by P&G are completely environmental friendly,
and have been evolved to minimize the impact on the environment.
Internal Marketing Audit of an organization requires analysis of the internal elements
which are responsible for the marketing activities. The marketing team and its effectiveness
plays a major role in determining the success of the promotional activities of the company. In
pursuance to the same the team structure of the marketing team of P&G shall be analyzed which
is comprised of product manager, advertising director, strategies manager, PR manager,
personnel responsible for creative services and so on. It is has been found that P&G has a highly
effective marketing team, which has been structured in the most effective fashion. The first line
of managers which have been mentioned above are assisted with a team of talented and skilled
personnel to carry out the specified activities (Adeyoyin, 2015). In this manner a work has been
distributed and assigned to the respective teams, so that a focused and effective work can be
carried out to realize the appropriate results.
SWOT Analysis of P&G Strength: The marker coverage of P&G is highly exponential, which it has developed
through 3000 brands available across the nations. On a global level it has a workforce of
around 125000 personnel, out of which a high percentage is working for the brand in UK.
Owing to the highly effective recruitment policy, the company has developed a highly
skilled and talented workforce which has been successfully inculcating the element of
innovation in all spheres of its activities. It is a globally renowned and known brand
which has a high number of loyal customers (Galbreath, 2009). The market infrastructure
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developed by the company is another area which has enabled them to capture large
market potential. Weakness: One of the biggest weakness is that the company is not able to detect the
origin of the fake products which are being sold in the market in its name. The portfolio
of the company is highly diversified and it is focusing on only certain specified areas.
This has resulted into a major influence on the sales turnover of the company. Further,
management of a highly diversified workforce also poses to be an issue, which has in past
impacted the level of productivity of the entity. Opportunity: With an enhancement in the growth rate in world, an increase in demand
for various products has been experienced, which in turn is one of the biggest
opportunities for the company. There are various target markets with high potential,
which the brand has not yet explored. These market offers several growth opportunities,
and enable the company to realize high benefits.
 Threats: The extremely fast moving market of the consumer goods in the nation can be
said to be one of the biggest threats which is posed on the position of the company. The
level of fierce competition in the market as well as the changing political condition can
be considered as some of the critical concerns (Paswan and et. al., 2011). It is important
to note that occurrence of Brexit has led to development of great amount of uncertainty in
the market as well as the political conditions of the nation and hence, can be considered
as the potential threat.
Position of the Organization in the market
P&G enjoys the tag of one of the largest and fastest growing enterprise, operating in the
consumer goods industry. One of the most important reason behind achieving this position in the
market is the belief on the basis of which it is functioning. The management of the entity is open
to alter everything in the company for achieving greater heights, except the core principles and
values which forms to be the fundamental to everything (Mahmoud and Hinson, 2012). Another
constant which can be witnessed is the customer-centric approach and the efforts to enhance the
shareholders value. Apart from these few elements, the management of the brand welcomes
every new and innovative change. P&G is the leader of all the products which exists in the
market under the name of about 65 brands. For instance the detergent powder of the brand is
considered to be the best selling product and has shown higher growth potential. Hence, a major
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portion of the market share for the detergent is catered by the company. On the basis of the
immense understanding of the customer requirements, the company has developed various
innovative products specifically catering to the needs of the consumers. This in turn has enabled
them to capture a market share of about 78%.
Critical Evaluation of Organization's Competitive edge
Over the years the company has developed various Unique Selling Points (USP) which
has strengthened their position in the market. The range of products which the entity has to offer
in the market is wide enough to cover beauty products, home care, health care, fabrics and so on
(Czinkota and Ronkainen, 2013). It is interesting to note that these products cover the maximum
market share in the respective arenas, thereby, resulting in higher sales and profits for the
company. The fabric and products related to home care accounts for around 32% of the market
share, as against the beauty products which amounts to 24% of the market share. In order to
sustain in the market as well as maintain the competitive edge over others, the management has
developed a strategy focusing on the development of some of these specific products, which has
resulted in growth at an exponential level. Another factor which has enabled the company to
attain the competitive edge in the market can be connected to the practice of undertaking intense
research and development practices in accordance to the market requirements and trends. In this
manner, the products of this brand successfully cater to the specific needs of the customer which
in turn has developed a sense of reliability and loyalty of customers towards the firm. The R&D
department has been accounted to invest immense amounts of money for carrying out these
activities, which in turn has aided the company to determine the specific preferences, leading to
manufacturing of products with the specific requirements. This can be evidenced by the fact that
the entity accounts for about 5 million consumers across hundred countries, which can be said to
be a wide range of market share with diversified customers (Meskendahl, 2010). Another critical
and highly important factor that has enabled the company to attain this position in the market is
that it undertakes research at the cultural level of the customers. Moreover, it constantly reinvests
the products so as to break the monotony and provide the market with new and innovative
products with the changing trends. This has amounted to be one of the major contributors in
enabling the enterprise to attain a better position in the market than their competitors. The
constant desire to innovate the existing practices and the available products, has led to a major
enhancement in the performance.
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Effectiveness of Organization's Current Marketing Strategies
One of the most appropriate aspects which shall be analyzed for determining the
effectiveness of the current marketing strategies is that of Competitive Performance. It is an
established fact that a fierce competition is faced by the entity in the consumer goods industry.
Another leading name in this industry is that of Unilever, which has been operating since 1885,
almost a decade after P&G commenced operating. Unilever has been recorded to realize a
turnover of about $66.7 Billion, as against which P&G has recorded the turnover of $ 83.7
Billion, which is much higher to the former. Both the companies are functioning in exactly the
same industry (Kumar, 2010.). It can be inferred from these figures that P&G has been operating
at a much higher level. For instance the the sale of home care and personal care products has
captures 53 % of the market share for Unilever, as against which P&G accounts for a share of
75% of the market. This clearly establishes the huge gap in the market share owned by both the
corporations in relation to the specific products. On the basis of these facts it can be concluded
that the operating leverage enjoyed by P&G is much better than that enjoyed by Unilever. In
result of which the level of profitability is much higher in the case of P&G. Hence, a very
comfortable position has been acquired by the entity in the marker, as against the other
competitors (P&G’s Love Affair with Consumers, 2015). One of the biggest credit for attaining
this position can be given to the presence of element of innovation in its products and internal
practices.
PART 2
Segmentation targeting and positioning
They are considered to be most important elements in the marketing where it becomes
easy to satisfy need and requirement of target market. Further segmentation is all about dividing
the entire market into various segments whose need is similar and on the basis of this customers
can be served easily. Further, it is possible that each segment will respond towards various
marketing mix strategies with the motive to earn higher profits along with market share.
Segmentation criteria involves demographic, geographic, behavioural etc. Moreover, in case
when segmentation is done on the basis of demography then customers are segregated on the
basis of age, income, lifestyle etc. (De Mooij, 2013). For example is P&G has introduced new
detergent in the market named Arial whose packaging has been done so as to provide
convenience to large family then this is regarded as segmentation as per demographic attributes.
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Further, in the present scenario segmentation of market for P&G for Arial can be done on the
basis of geography. This segmentation criteria is based on large number of locations such as
region, nation, state etc.
Through this targeting becomes easy along with understanding actual need of the target
market. Segmentation on the basis of urban and rural area is quite possible for gaining market
opportunities. With the help of this, P&G can easily focus on the requirement of market to whom
product range can be offered easily. Moreover, it is possible to know about the social trends
prevailing in the market. No doubt segmentation is regarded to be most important in enhancing
focus of the organization and in turn it provides base to deal with the situation of rising
competition level in the market. This can lead to enhanced market share along with profitability
level of the organization. Geographic segmentation is most appropriate for P&G for expansion
purpose where operations can be efficiently carried out in the new market for serving large
number of customers. It can enhance level of brand equity, recall, retention of customers along
with the type of communication taking place in between target market (Perreault Jr, Cannon and
McCarthy, 2013).
After segmentation one of the most crucial element is targeting where business has to
develop effective strategies for targeting customers. This strategy is of different types such as
undifferentiated, concentrated and multi segment one. Attribute of every targeting strategy is
quite different and it is necessarily required for business to select the most appropriate one so
that customers can be easily influenced to buy product. Considering the present case procter and
Gamble can adopt concentrated targeting strategy where specific market can be easily chosen
and business can concentrate on their needs. Through this organization can easily become leader
in the market and can easily grab the range of opportunities being present in the business
environment (Kapferer, 2012).
On the other hand, positioning is also one of the most important elements of marketing
where P&G has to develop unique brand image of its products in mind of its target market.
Through this sales volume of company can be enhanced easily. Positioning can be done by
organization on the basis of product attributes and this can surely allow organization in gaining
competitive edge. Further, this strategy is regarded to be most useful as compared with others in
the market. P&G can easily highlight how different are its products from those of other
companies and in turn customers can be easily influenced to purchase the same. In rural market
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positioning can be done on the basis of quality which is regarded as one of the most significant
factor while purchasing product (West, Ford and Ibrahim, 2015). Therefore, this can provide
large number of benefits to business in every possible manner.
SMART Objectives and Goals
Some of the objectives and goals which shall be pursued by P&G, in order to maintain its
current position in the market as well as achieve newer heights for its detergent product, Arial.
Some of the recommended objectives and goals have been enumerated herein under: Enhancement in Brand Awareness: The management of the entity shall plan to develop
a promotional activity for increasing the awareness of Arial within the customers. In
consequence of which the existing brand name of the company has the potential to
influence the popularity of Arial within the existing as well as expected customer base
(Bowonder and et. al., 2010). This shall necessarily persuade the customers to purchase
the Arial detergent. Enhancement in Market Share: With the assistance of Market Segmentation, the
company can aim to achieve higher share of marker. A target of 30% increase shall be
ascertained to be achieved by the year 2020. Adopting market segmentation shall enable
the entity to adopt a more focused approach to perform in a better manner. Increasing Growth in Sales Volume: In order realize growth in the sales volume of
Arial, the company can make an effort to apply some innovative elements. The elements
shall be such that they can persuade the customers to opt for Arial against the other
available detergents in the market (Varadarajan, 2010). With the assistance of these
innovations the company shall aspire to realize atleast 20% increase in the sales volume
by the coming year. Further, some promotional offers or discounts can also be
introduced in the market for increasing the sales volume.
 To enhance Profitability: Earning profits is one of the most fundamental requirement
for existence of a business. P&G shall aim to earn higher profits by adopting various
relevant means. One of the means which shall assist to achieve this aim could be
through increasing the sales volume. The company can even make an effort to make a
reduction in the cost of production which shall have a direct positive impact on the
profitability of the company.
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Developing a marketing strategy on the basis of relevant marketing mix
For achieving the above mentioned objectives and goals, the following marketing
strategy has been prepared, on the basis of the 4 Ps in respect of the detergent product of Arial of
P&G: Product: One of the products sold by P&G is detergent, which also constitutes to be one
of the basic requirements of each and every household. Hence, there is a large scope and
great opportunities available to the company for increasing the sales of this product. One
of the ways which the company can adopt is introduction of different packages on the
basis of weight (Ortega, 2010). This shall enable the customers to make a purchase on
the basis of their requirement which shall be available only in this brand. The product
can be reinvented by launching different variety of detergents, differing on the elements
of fragrance or utility. This shall enable the entity to achieve enhanced sales of Arial. Price: Adopting of an exclusive pricing strategy is one of the important factors, for
making an identity in the market. Hence, P&G shall adopt varying pricing strategies for
different target markets. It is important to consider the living standards of the area and in
accordance to which the pricing shall be done. Place: This accounts to be one of the critical aspects which determines the location
where the product shall be sold. This marketing mix of the detergent shall be ascertained
by the company. The detergent shall be sold at various retail stores and in all the possible
areas (Wheelen and Hunger, 2011). Easy availability of the product shall be assured
since it is one of the most commonly required goods in the society. This in turn shall
increase the sales volume and may also develop a range of loyal customers for the
company.
 Promotion: For the purpose of promoting the product the organization has made
adoption of several strategies that includes advertisement and personal selling. Through
this Procter and Gamble can enhance popularity of its products within market place. For
increasing the awareness regarding the product which is detergent firm can advertise by
means of putting hoarding over several locations. In addition to this it can offer free
sample to the target market so that they can attain experience through use of the product.
This will lead to enhancement in the sales of the brand that affects the profitability of the
organization.
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