CASE 9: PROCTER GAMBLE
Procter & Gamble (P&G) is one of the most skilled marketers of consumer packaged goods. It markets the leading brand in 19 of the 39 categories in which it competes. Its average market share is close to 25 percent. Its market leadership rests on several principles: * Customer knowledge: P&G studies its customers—both final consumers and the trade—through continuous marketing research and intelligence gathering. It prints its toll-free 800 number on every product. * Long-term outlook: P&G takes the time to analyze each opportunity carefully and prepare the best product, then commits itself to making this product a success. It struggled with Pringles potato chips for almost a decade before achieving market success. * Product innovation: P&G is an active product innovator, devoting $1.7 billion (4 percent of sales) to research and development, an impressively high amount for a packaged-goods company. Part of its innovation process is developing brands that offer new consumer benefits. Recent examples include Febreze, an odor-eliminating fabric spray; Dryel, a product that allows consumers to clean and freshen "dry clean only" clothes at home; and Swifter, a new cleaning system that more effectively removes dust, dirt, and hair from floors and other hard surfaces. * Quality strategy: P&G designs products of above-average quality and continuously improves them. When P&G announces "new and improved," it means it. Recent examples include Tide and Ariel compact detergents that remove stains and sanitize laundry while protecting original fabric colors; and Pampers Rash Guard, the only diaper designed to treat and prevent diaper rash. * Line-extension strategy: P&G produces its brands in several sizes and forms. This strategy gains more shelf space and prevents competitors from moving in to