Case Study: Procter & Gamble Business Strategy

795 words - 4 pages

Case Study: Procter & Gamble Business Strategy
Summary:
Procter & Gamble, the internationally known company that was founded in 1837, is the producer of various everyday household goods. Over the many years of manufacturing, marketing, and distributing products, the company developed many business strategies and adjusted them accordingly when needed. The first strategy Procter & Gamble used was to have mass production of goods out of their hometown, Cincinnati. Then they would have a group of smaller, independent companies handle the manufacturing, marketing and distributing of those products. During this time, the 1960’s, this way had worked due barriers to cross-border trade. This meant ...view middle of the document...

These companies were also in charge of producing marketing tools, like packaging, brand name, and slogan, which were appealing to the consumers in their own countries. This took the stress of research and development in foreign countries away from Proctor & Gamble and reduced unnecessary costs.

2. There were a few reasons for Procter & Gamble’s strategy becoming less viable in the 90’s. One of which is that people wanted products at an affordable price. Consumers realized the products from name brand companies did not differ greatly from the products of store brands. Also, it brought on the realization that the name brands were not always worth the inflated price. It was not that consumers were not spending their money on expensive items; they were just more selective about what they spent it on. Tim Smith, Chief Editor of The WIglaf Journal, uses the example of toilet paper versus tooth paste. His theory is that people will be likely to buy Crest toothpaste, a name brand paste, over the store brand for the quality of it and chances of reducing dentist visits. On the other hand though, whether its Charmin toilet paper or a store brand toilet tissue, “they both end up down the toilet” (2010). So in this situation price often outweighed the quality of the product. The majority of consumers would purchase the cheaper of the two.

3. The strategy Proctor & Gamble seems to be moved toward now is globalizing their products. By setting up a...

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