1. Procter & Gamble in Europe
A roll-out launch
Wolfgang Breuer and Richard Kohler

2. Group 4
Chien
Jay
Ralph
Luk
Mega
Praew

3. Outline All about P&G Introduction strategy in Europe
Marketing objective
A ‘roll-out’ launch
Media and promotion budget
Cost vs revenue implications

4. 1920s – 1930s – started to sponsoring radio programs -> soap operas
History
31 October 1837 – founded by Alexander Norris (an American), William Procter (a British candlemaker) and James Gamble (an Irish soapmaker)
Late 1880s – significant increase in amount of sales, number of employees and variant of products
1920s – 1930s – started to sponsoring radio programs -> soap operas
1930 – acquired Thomas Heldey Co. (England based)
Jay

5. History (cont.)
Late 1990s – acquisition of more companies (Folgers Coffee, Norwich Eaton Pharmaceuticals, Richard-Vicks, Noxell, Shulton’s Old Spice, Max Factor & Iams Company
1994 – sued Bankers Trust for fraud after having the advantage in interest rate derivatives
January 2005 – acquired Gillete
August 24, 2009 – Warner Chilcott (Irish-based company) announced buying P&G’s prescription-drug business
Jay

6. Company Profile
Robert A. McDonald Chairman of the Board, President and Chief Executive Officer
Giovanni Ciserani President – Western Europe
Switzerland is headquarters of P&G Western Europe, the umbrella for the US giant's operations in the UK, Germany, France, Italy, Spain, Greece, Scandinavia and other markets
P&G’s Organizational Structure
Jay

7. Profit Sharing
Jay

8. 2010 Financial Caption Net sales increased 3% to $78.9 billion
Unit volume increased 4% versus prior year
Net earnings decreased 5% to $12.7 billion
Jay

9. Introduction Strategy in Europe
Criteria for brand name selection
According to the market research the consumer were willing to pay the equal price for the selected product (Vidal Sassoon, Shamtu, Pantene, Pert Plus).
The BC-18 technology would be introduced by the existing brand in a new quality.
Luck

10. Introduction Strategy in Europe (cont.)
Positioning
The shampoo will provide great-looking hair in a convenient way
Target group
All people
Sources of business
New users
Pricing
Premium-priced up to 100% of the low-price market leader
Packaging
Using the existing US bottle for Pert Plus would not require any lead time
Luck

11. Marketing Objective
Get into European market by establishing identity of the brand and positioning itself as easy, time-saving everyday use of the product under the product concept of 'wash & go'.
Need to educate the market in the use of conditioners further. And new hair care technology ‘BC-18’ which can combine shampoo and conditioner within one product and it has the same effect as using shampoo and conditioner separately.
TV spots
Display activities in the supermarket
Handing out free samples
Praew

12. Long-term Marketing Objective
Creating value-based market share of their brand :
build strong awareness brand
brand loyalty
“bring your old shampoo and conditioner, then get the newest Pert plus Product for free” campaign.
Attractive advertising and sales promotion to boost
Praew

13. A ‘roll-out’ launch
P&G should focus upon West Germany, Great Britain, France, Scandinavia and Benelux:
Southern European countries have quite an underdeveloped conditioner market compared to the USA.
Because of "a steady growth of the shampoo market and the conditioner market" and statistics show an increase in hair washing, Europe is the attractive market to undertake a ‘roll-out’ launch.
Chien

14. A ‘roll-out’ launch (cont.)
The decision criteria :
The share of shampoo users who also use conditioners reaches almost US standard in Great Britain, with 42%.
Germany has the second best user share, followed by Scandinavia and Benelux, where conditioner consumption is almost equal.
In France, sales volumes for conditioners only make up 10% of those for shampoos, and France should follow in the second year to avoid competitors' me-too products to be introduced in those markets.
Chien

15. A ‘roll-out’ launch (cont.)
A consumer test in Europe proved that the original US bottle for Pert Plus was the most appealing compared to the alternative products varying in brand name, size and price.
28% would definitely buy it and 70% considered it to be very convincing and relevant.
Thus introducing BC-18 into the European market would be rather uncomplicated, this can be seen in the expected sales exhibit, where sufficient production capacity is guaranteed.
Chien

16. Media and Promotion Budget
Affordable Method
a method used often by a small business, which they think they can afford
Competitive Parity
a method which they try to keep their promotional spending comparable to the competitors’ spending level. This method is designed to keep a brand in the minds of consumers.
Ralph

17. Media and Promotion Budget (cont.)
Objective and Task Method
a method whereby marketing managers determine:
What they want to accomplish (objectives) with their communication,
What activities (commercials, sales promotions, publicity, and etc.) are necessary to accomplish the objectives,
How they conduct a research to figure out how much the activities, tasks, and cost in order to develop a budget.
Ralph

18. Cost vs Revenue Implications
In the first year, there are some losses to be expected, especially Vidal Sassoon.
In West Germany, Vidal Sassoon 200 ml incurred loss by Deutschmarks 7.75 per 2.5 litres
In Great Britain, Vidal Sassoon 200 ml incurred loss by Deutschmarks 0.25 per 2.5 litres
In Scandinavia, Vidal Sassoon 200 ml incurred loss by Deutschmarks 1.75 per 2.5 litres
The other product (e.g. Shamtu, Pantene and Head & Shoulders) was profitable in Europe
Mega

19. Cost vs Revenue Implications (cont.)
P&G surely need the modification for the loss incurred in the first year. In order to enter the local market entries, they should:
Aware of any new technology developed for hair product -> keep R&D activity
Create an interesting packaging with a premium price -> European like stylish design
Applied consumer test before launch new product in Europe -> strong vs weak brand image

20. Thank You