Proctor and Gamble

Proctor and Gamble Decision Sheet

Situation:  P&G’s share of Light duty liquid detergents (LDL) is 42% or $357m of market share and 30% is the share of P&G’s soap brands. P&G wants to expand their volume in the LDL market.

Decision and Rationale:  Using Cost-Benefit Analysis

1.Using H-80 to launch a new Performance Brand:-

• 60% share of it share from other competitors = $25 m (Consider it grows to 16%)
• $20 m capital investment
• $60m for marketing
• 77% customers favoured its attribute
• 80% customer scour
• New product launch will take 2years and additional 1 year for testing
• In performance brand joy has 12.1% and Dawn has 14.1% market share
• Dawn growth 16.5% in next 5 year as is proposed
• Joy increase by 1% in next 5 year as expected

2.  Using H-80 to enhance a current Performance Brand.

• Capital cost $20m
• Marketing $10m

Joy

• Cost of goods sold by $3m per year
• Marketin $10m
• No capital investment
• Joy’s growth was 10% initially

3.Consider launching a new brand in the Mildness segment

• 11% customer wanted mildness
• Liquid ivory 89% support  from customers
• If ivory introduced 2/3rd advertisement is for mildness and 1/3rd for value addition

4.Consider launching a brand in the Price segment

• Parity performance
• Market expenditure came from  32 to 14 % of sales

5. Increasing advertising spends for current brands