Executive Summary of P Assignment free sample

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Executive Summary This project is based on P&G.. We have restricted the study to the company’s operations in china. China is the largest emerging commodity market in the world; We effort to apply marketing concepts such as internal and external’s macro & micro environmental factors, SWOT Analysis, Product Line Cycle, Five Forces and Marketing Mix etc to P&G with china, so as to understand these concepts and strategies better when applied to a real life scenario.

Marketing environment includes many factors that can affect the relationship between customers and our P&G marketing department. The marketing environment can provide both opportunities and threats. China with their Head&Shoulds Hair care product. This was the Company’s first operation in the largest consumer market in the world and achieves success. P Global Operations The name P combines William Procter with James Gamble——Procter & Gamble. On April 12, 1837, they started producing and selling their soap and candles.

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On August 22, they formalized their business relationship by pledging $3,596. 47 a piece. The formal partnership agreement is signed on October 31, 1837 what began in 1850 as a small, family-operated Soap and Candle Company now provides personal care of superior quality and value to consumers in 140 countries. Since 2000, the P president and chief executive A. G. Lafley leads community consists of nearly 98,000 people working in almost 80 countries worldwide.

China is the largest emerging commodity market in the world; Procter & Gamble has realized the tremendous market potential for its products. Retail outlets in China are very small, sell only a couple of units in a month and make their own decisions regarding the assortment of brands to sell. P has used street maps of Chinese cities to pinpoint the location of the retail stores, and sent locally hired ‘ground troops’ to sell and service each outlet. P has customized its hair care products to suit Chinese customer’s needs and wants.

Dandruff had been a big problem that few Chinese shampoos had solved. P&G entered the market with Head & Shoulders-anti dandruff formula, followed by Rejoice-cool feeling (Pert in the US) and Pantene-more protect your hair, each of which had an anti dandruff formula, Those three kind of shampoo have grabbed over 50% of the market in China’s major cities. Marketing Environment Marketing environment includes many factors that can affect the relationship between customers and our P marketing department.

So far, P have 98,000 people working in most 80 countries worldwide. In China, Company owned 4,000 employees. P is an innovative aggiornamento corporation, they have 8,300 top scientists recruit, and hereinto 2,000 have Technology Doctorate. Those talents are basic resource sustain P to develop its technology. P has created a free online interactive case-study game,it has become the center-piece of its recruitment efforts. It can reduce the costs and increase efficiency of recruitment Ref: http://www. swlearning. com/management/hrm_news/recruit_0104_001. html P Company manufacture industry in china 1988. Manufacturer can directly get cheaper labor resource.

The management talents are scarcity because most of Chinese education level is still low. It is weakness affect P get technology and marketing manager’s localization. Compare to the other company’s, P constitute participate profit with employees; Height employee evolved with company works. Elitist plus the best space for improve employee skills and more openly environment. E. g. Procter & Gamble gave employees two extra vacations days are a reward for outstanding stock performance. Ref: http://www. pg. com/jobs/corpinfo/diversity. jhtml During 1988-2003 years, P company net sales are keeping growing, especially in 2003year. It is good news to the P firm.

Procter & Gamble Company has exceeded consensus expectations for fourth quarter and fiscal year results and that double-digit earnings growth and solid top line performance in the April-June quarter “has resulted in the achievement of P&G’s long-term annual growth rate targets a year ahead of objective. “(Datasheet page34. 1) Since P entered China in 1988, it reportedly has invested well over $1 billion and is by far the country’s largest advertiser. What’s more, P now generates about $2 billion in annual sales from China, CFO Clayton Daley told the Cincinnati Society of Financial Analysts June 15. That’s about 5 percent of P&G’s total sales, in 2004.

For the quarter ended June 30, unit volume grew 10% versus the prior year led by double-digit growth in the health care and beauty care businesses, benefits of the Clairol acquisition, and strong performance in fabric and home care. For the fiscal year, unit volume grew 7% behind outstanding results in health care, as well as strong progress in the fabric and home care and beauty care businesses. Ref: http://www. brandweek. com/brandweek/icopyright_display. jsp? vnu_content_id=1592575 To capitalize on China’s strong growth, various companies are establishing offices or manufacturing plants there, including Procter & Gamble (P&G), JNJ, Kraft and Budweiser. P&G is positioned to gain a first-mover advantage in China versus other companies. It is already seeing 30 percent-plus annual growth there. (Datasheet page34. 2)Ref: http://home. online. no/~norem/finance/pg. htm

In 1988, the Company announced a joint venture to manufacture products in Guangzhou of China with their Head&Shoulds Hair care product. This was the Company’s first operation in the largest consumer market in the world and achieves success. The technology center is in Beijing and filial is setting up in the city of Beijing Shanghai and Chengdu. Up to the present enlarges to 7 cities and sell overcast 500 cities. China is a big country which can provide land for manufacture, physical resource for producing and easily get first level labors. All these benefit is reducing P Company’s physical cost. Ref: http://www. pg. com. cn/sitenav/site-01. htm

P&G is one of the biggest companies which produce daily using product. In fortune magazine P&G Company is position 93rd in 500 globalization enterprise P&G is among the top 10 contributors to United Way organizations in the U. S. 1992 P&G received the World Environment Center Gold Medal for International Corporate Environmental Achievement. P&G and its Cincinnati-based (headquarters) employees and retirees contributed 28 percent of the yearly budget of the Greater Cincinnati United Way, through P&G’s yearly campaign. Furthermore, the company’s foundation, contributed $39. 5 million last year to educational institutions, health, social service, cultural, civic, and environmental organizations.

Globally, P&G persists in killing animals in the development of cosmetics even though such testing has been, in effect, outlawed in the UK. They poisons and kills thousands of animals in the development of consumer products BOYCOTT on Saturday 22nd May 2004, there will be actions in every corner of the UK and in cities across the world to protest at Procter & Gamble’s (P) animal testing practices. This is a negative message to P; it has a little affects P’s reputation, marketing share severity. External Analysis of P&G Analysis P&G external environment as: government political, economic, even toward customers, competitors, Chinese market and its environment. It will help P&G Company contrast long-rang planning systems. Factor | Impact of factor |Potential | | | |Opportunity or threat | |Political/legal |China Joint WTO |Opportunity | |Factors |Protection P&G Property Rights |Opportunity | | |Law to foreigner investments |Opportunity | |Economic Factor |China GDP Increasing |Opportunity | |Social Factor |Education Level Advance |Opportunity | | |Chinese Population Growth |Opportunity | | |Consumer Mind- Quality life |Opportunity | |Technology Factor |Strong competitors |threat | (Political Factor Now China is rapidly becoming a major player in world politics, and its economy is expanding fast. It provides opportunities to P&G in business. China’s intellectual property rights administrative organs, in accordance with Chinese laws and relevant international treaties to which China is a party, adhering to the principle of equal treatment for nationals and non-nationals and reciprocity, give protection to foreigners’ intellectual property rights in accordance with the law. Encouraged by its successful strategies, P&G plans to further expand its presence in China by establishing three new joint ventures (P&G, 1993).

In order to decrease the dependence of the enterprises on Chinese governmental control China’s new open policies give P from U. S. a sea of opportunities. A main objective of China today is to allow foreign as P investment, while preserving control over the foreign operations in the country. To P products as Header & Shoulder have not got any affect with Chinese political, but P Company have a major investment in China as shock market. The financial resources still control by the central bank of China, during the business process take good care of the relationship with china government is important to our Company brand. So invert in china is not only about business. Obey the China political law is the premise to P Company investments. (Economic Factor

The growing importance of China on the world stage is generally recognized. Since the ‘opening up’ of the Chinese economy, initiated in 1979 by Deng Xiao Ping, China’s economic growth rate has on average been the fastest in the world. From a quantitatively already large base, annual economic growth averaged 9 per cent in the 1980s and 12 per cent in the first half of the 1990s. China already ranks fifth in terms of its share of world trade and seventh in terms of GDP. In particular, the government has encouraged huge inflows of foreign investment – especially in exporting joint ventures, which have produced a rapid increase in China’s exports and a positive balance of trade.

P started a joint venture with a state-owned Chinese soap company seven years ago (Reitman, 1993). The company decided to build its department stores in the cities of Beijing, Shanghai and Guangzhou. To reduce its exposure to risks associated with currency inconvertibility and volatility, P exports roughly 30 percent of its products to Western countries (Leung, 1993). Revenues from exports provide part of the needed hard currency. The company buys many of the raw materials locally, which reduces the need for dollars and decreases costs. For example, in 1992, P started Chinese production of the surfactant needed for making shampoos (Reitman, 1993).

Thus, the company did not have to pay dollars for imported material and also avoided high import tariffs. (Social Factor From 1949 to 2004, China is step by step changing to be more fashion and technology. Chinese are more acceptable with different culture from foreign. The communication between Chinese and the whole world is pleasant sociability. Age 15 and over can read and write is 81. 5% of total population. In different cities, there are always conduct “Technology Communication Conference” for those technology talents discuss the future of Chinese technology. We get secondary data shows that the Chinese population is increasing 890,000 to 1,029,000 from 1996 to 2001. The population age between 15-64 years is 68. 4%. The birth ate is 9. 8 more than death rate. This entire social environment is benefit for P Company to selling quality products in China. In 1990 years many Chinese’s needs and wants are stand for eating fully and have clothes to keep warm. But now the Chinese economic is growing fast; the Chinese income is changing their mind to enjoy a quality life. They want to be more healthy, beauty and happy. It meets P&G’s statement of purpose provides products of superior quality and value that improve the lives of the world’s consumers. As a result, consumers will reward us with leadership sales and profit growth, allowing our people, our shareholders. (Technology Factor

When P&G Company develop manufacture industry in China, P&G has also customized its hair care products to suit the needs of Chinese customers. Head & Shoulders which product is first entrance into Chinese remove dandruff and leave your hair irresistibly attractive. P&G Company produce daily use product, it is different with MICROSOFT which company is the worldwide leader in software, services and internet technologies for personal and business computing. So the technologies are not close link with P&G Company products. The same factors to P&G Company’s competitors, the technology to product cosmetics are not changing so fast as technology market. That is the reason P have many competitors in China cosmetics market. Customer analysis China’s population of over one billion consumers surely represents a marketer’s dream. At the same time, the country’s very size and geographical diversity make reaching markets somewhat daunting. Urban China today comprises approximately 100 million house holds. As an indication of the wide distribution of China’s population, according to the State Statistical Bureau there are now well over thirty cities with populations exceeding one million. Also, when looking at the overall market in China, it is significant that China’s population is still very young, with the nationwide average age barely twenty-eight. (Financial income

For a rough comparison of consumer behavior and purchasing power in urban China with other developing markets, household incomes can be doubled; in other words, the consumer behavior of a family earning $2. 500 a year in China would be similar to a family earning as much as $5000 in some developing markets. (Consumer buying habits The buying habits of China’s newly affluent consumers are very much shaped by their lifestyles, psychograhics and new-found spending power. First and foremost, as noted above, China’s consumers are quite willing to experiment, to try new products and brands. They like to see some new and fresh things with the interesting design.

They are highly brand conscious, welcoming the quality and the reassurance promised by strong brands, preferably international in origin. China’s consumers respond well to emotional and aspirational advertising, which builds longer-term intrinsic brand values. The lifestyles depicted in advertising use Chinese references, showing lifestyles which could conceivably be attained in China, rather than being totally foreign. That’s the reason consumers are much quicker to drop a brand when their knowledge and relationship with that brand is only a few months — or at best a few years — old, rather than decades long. ——? Strategic Market Management ? (Competitor Analysis

Procter & Gamble has recently engaged in a corporate espionage program against competitors in its hair care business- Unilever. These two company both in top of the global 500. Unilever is in 54th, they expanded their business into 150 countries, in hair care business, P&G get 6% more market share than Unilever. The top 10 Shampoo in mass retail, the top five shampoos are all belong to P&G as Clairol Herbal, Head & Shoulders, Pantene. Unilever just take top 6, 7 and 9 as Thermasilk Regular shampoo, Suave and Finese. For example: The Thermasilk shampoo is focus on unique silk protein formula is heat activated to help lock in moisture while heat styling.

The reason for Unilever shampoo is not as famous as P&G’s, just take Head & Shoulders for example, it is can solve dandruff problem, of course in P also have hair protect shampoo as Thermasilk shampoo like Pantene. Both of these two big companies spend lots of money advertising for their shampoo nearly 1 hundred million dollar. For advertising we can not say who wins, just see which company more successful in hair care market. China local competitor During the whole process we go to Chinese hair care market, until now there are many local shampoo company produce products are cheaper than us. Sulei, Lafang, Haodi and Bolisi are local brand, these brand have even more dominance.

For example: 400ml shampoo, Rejoice price is $6, Head & Shoulder is $7. 5, the local brand as Lafang and Bolisi only $3. 5. Ref: http://www. emkt. com. cn/article/163/16388. html SWOT Analysis SWOT 1 | Strength |Weakness | |Top Scientists Recruit |Lack Management Talents | |Job seeker Apply Online |Boycott P kill animals | |Employee training /reward system | |Positive Cash Flow | | |Benefit form Sales | | |Steadiness within competition | | |Manufacture In China | | |High Company Value | | | Opportunities | Threat | |{China Joint WTO |Strong competitors | |{Protection P Property Rights | | |{Law to foreigner investments | | |China GDP Increasing | | |{Education Level Advance | | |{Chinese Population Growth | | |{Consumer Mind- Quality life | | SWOT 2 O W T T P Company in cell 1, the decision basic on the data which we analysis in SWOT 1. The company’s Opportunity and Strength are more than Weakness and Threat. Focus on the different target market, P&G must choose different strategy to satisfy the need of the customer and effective exertion diversified resources to overcome the challenge from internal and external environment that will take P&G continuous growth and progress. SWOT3 Internal | STRENGTH | WEAKNESS | |External | | | | |{ Positive Cash Flow |Lack Management Talents | | | | | |OPPORTUNITY | | | | | | | | | | | | |Consumer Mind- Quality Life |Education Level Advance | | | Top Scientists Recruit |?

Boycott P&G kill animals | | | | | |THREATS | | | | | | | | |Strong competitors |Strong competitors | (Strength and Opportunity As we know P&G Company’s financial factor, it is keeping growing these years either in UK or China Market. P have well-done cash flows; it is strength to develop a new product- e. g. : Hair Care Shampoo in China Market, the positive cash flow is important financial supports. Human resource and developing process P should spent lots of outlay.

China is growing day by day; it is the time for P Company to develop a new shampoo which is real suit Chinese consumers. Different parts of the world, the person have different hair color, hair skin. Chinese consumer want to higher their life quality, it other than eating fully, wearing warmly. Consumer’s needs and wants be satisfied is P&G’s purpose. That’s the reason we get opportunities be support by powerful finance fully to develop a new Hair Care Shampoo in order to provide varieties of product to be choose. (Strength and Threat P&G provide branded products and services of superior quality and value that improve the lives of the world’s consumers.

We are different from MICROSOFT Company which is professional produce software, services and internet technologies. P is absorbed in services department more than technologies parts. That’s the reason we get many strong competitor as JNJ, Kraft and Budweiser Operational Company. P&G is fortunate having many top scientists recruit can help Company avoid risks with competitors as much as possible. (Weakness and Opportunity P&G Company build manufactory in China 1988 years. There have not got many professional management talents in daily use markets. Most entrepreneurs are control by government, lack knowledge of business management. It is negative factors affect P&G increase its human resources costs.

Nowadays, Chinese social environment is peaceful, many students get higher graduated. China has different kinds of talents, of course including business management talents. At the same time many cities hold business communication chance to share experiences. Using the positive social factor solve the weakness. (Weakness and Threat Global Boycott P&G is a damage of Company’s brand image. It’s a good chance for my competitor as JNJ to increase company’s brand in the social environment. Some of my consumers who fight for P’s animal testing will immediately shift to our competitors increase their sales. So in order to maintain P&G’s consumer and increase our brand image, we should ommunicate with these special consumer and take care of the animal social environment as imbrues some animal association. To overcome this Boycott weakness and maintain consumers bring down chance for competitor higher their brand image. The Product Life Cycle [pic] Nowadays, our P Company become in maturity stage in product life cycle. In the past, when our company was in introduction and growth stages, we had to face many difficulties with suppliers, consumers and other forces. After 45 years, our company has reached to stable stage, maturity stage in product life cycle. At this moment, our sale is peaking and we have our own customers groups.

Moreover, our products’ prices become low cost per customers. Because of high sale, we can reduce our operation charges costs and we can set our price to low cost. However, even we set the low cost; we still have high profit in the market. Furthermore, the number of competitors has become stable in the market. For example, our main competitors are Unilever and JNJ. Because of stable competitors numbers we can plan our company’s goals stably however, we must implement and maintain our brand image to be still in the maturity stage by using new kinds of advertising, customer care, selling process, product quality and so on. Porter’s Five Force [pic] (Potential entrants-Low threats

Nowadays, daily use market is every where in the world, it including personal & beauty, baby & family, house & home, pet nutrition & care, health & wellness, etc. It is not closely link with high technology use for products. The more important factor to daily use market is communication skills with our consumers. So for entrants are easy enter this market. All of these entrants come into it, in order to get as much as possible benefits. But the daily use market is maturely. The experiences of services are related to your company whether can get benefit. All entrants first enter the new market the cost are very high. P&G Company, have 45 years successful experiences on daily use market. They have strong brand image, positive cash flows, and much strength.

To P&G the entrants can not easy affect P&G. But we must have a future eye can image what will happen tomorrow. If entrants have good quality products we can buy them and reduce company competition. (Substitute Products-Low Threat Hand & Shoulders product is one quality hair wash and care product produce by P&G. Hair wash is necessary for our healthy life. If consumers do not choose this product, they can select use soap, cut all of your hair or even wash hair with no shampoo. Soap is a common wash product, nowadays technology developed many special and useful hand wash, body wash products. Many consumers are not using it at all. But it can be use for hair wash.

Another choice cut all your hair, no hair nothing has to cut. Today consumer’s life is stay at high level, they enjoy their life is not meaning hard work, so do not wash your hair is not possible exactly. But it depends on your own mind. So its low threat of Hand & Shoulders hair car substitutes products. (Buyer’s power-High Threat Daily use market is common and necessary to person’s life. It is as a big cake has many companies produce daily use products to earn the market benefit. So consumer has many choices, if they do not want to buy Head & Shoulders for anti-dandruff. They can choose another company’s brand also have high quality of anti-dandruff. It is high threat to P&G Head & Shoulders.

In order to remain our consumer continue to buy Head & Shoulder, it is necessary to improve it be more useful. Another way is to use quality advertising give consumer directly mind. If consumer wants to anti-dandruff, they will bethink Head & Shoulder. (Supplier’s Power-Low Treat Nowadays many operational companies enter China various market. Because Chinese consumer is a big market and supplier’s power is big. Company can easily get lower price resources to continue producing in China market. The same to P&G has many suppliers. They can choose the most benefit supplier to provide resources. Consequently, its low treat to P&G find best suppliers/ (Degree of Rivalry-High Threat

To P&G Company’s commodity, the degree of rivalry is related to buyer’s power. In buyer’s power we mention that P have high treat. That’s to say consumer have many choices to make decision whether to buy our products. The other factors high treat of P&G Company’s degree of rivalry, as in China internal marketing have many location commodity corporations. They can easily touch the consumer behavior basic on better knowledge about local. And consider about the external environment location commodity corporations have not customs duties. It will reduce their cost lead to low price than P. And one more complication the government will support and protect made in own country products.

In external environment, P also has other foreign commodity competitors as Unilever, Johnson & Johnson. Both of them have high brand value, good quality of products, is adapt in advertising for their commodities. Basic on these factors, whether in china domestic commodity market or external strong competitors both affect high threat degree of rivalry. (Datasheet page34. 2) The Marketing Mix The 4-Ps of Marketing (Product P Company is absorbed in everyday solutions. Hair Care of P famous brand: Head & Shoulders, VS Sassoon, Pantene and etc. They are convenience products is the position for P shampoo in the type of consumer products. People buy shampoo for hair care is frequent. It is little planning comparison with other shampoo.

It is depend on personal mind and their experience whether P shampoo can take care of her hair. If you do not like this shampoo, you can choose other kinds of shampoo. (Price element P shampoo stay at long price compare with the normal shampoo. Because P’s value is good quality, long price, more enjoyable. In China P&G shampoo is $2 expensive than normal one. In different country between Singapore and China, it is keep the uniform price. As comparisons new shampoo both come in two countries, the price in China is a little bit higher than in Singapore, because the social environment, income level-Singaporeans are higher than Chinese. The price of our product is more acceptable in Singapore.

Competitor is one important element affect our price, price-cutter always happen in order to overcome competitors. Of course the price is more effectible by the market competition rather than control by the government. (Place Commodity produce always be sell in supermarket or retail shop as Watsons, or Guardian, in china also. It is convenient for consumer to buy. The type of distribution is manufacturer to wholesaler to retailer then finally to consumer. P&G Company is operational which just make manufacturer in china in 1988 years. The wholesaler is important link manufacturer with retailer. Consumer always buys shampoo in retailer. [pic] [pic] [pic] (Promotion

Though commodity is common in personal life, it is still necessary for P&G Company to use different kinds of promotion to attract more customers and more people know P&G Company’s shampoo, in order to get much more marketing share than P’s competitors and build up international brand image. So P&G can not ignore the important of promotion (Advertising Advertising is one of the most important promotion tool which P&G use magazine, newspaper, network, TV, broadcasting, and even promotion paper. And P&G successful in commodity market can not leaving TV advertising. The reason for P&G use TV because is the best choose to advertising for new come shampoo. This inter medium attracts thousands upon thousands eyes per day. Now advertising is entering cinema, when the firm is not starting yet.

The inter medium can give you directly listening and emotional feeling to introduce products. And the process is more well for spread information, customer just stay at home enjoy coffee can know the new come produce by P&G. The respondent to P&G Company’s shampoo-Head & Shoulder is increase the income of P. (Sale promotion The low price is main idea promotion for H, but P also cooperate with some cartoon toys company, or in especially times-Chinese New Year give consumer gifts. (Informal word-of-mouth advertising This method is the social community by personally. It can not be control by P even any other operational companies. It is consumer’s experience to buy shampoo.

As soon as possible do shampoo research to get consumer’s mind directly. Fortunate, Head & Shoulder enter china market get a good income; the informal word-of-mouth advertising is positive respondent to H. The additional 3-Ps of Services Marketing (People in Service The supplier to company, wholesaler, retailer, employee, and consumers are those people in P Company service. P Company sets manufacturer in China. The relationship between P Company and wholesaler is important. e. g. when Company first enter China market they do not care about wholesaler, but now company find that the sales of wholesaler directly affect wholesale buy product from company. So now company helps wholesaler advertising products.

P’s employee is more involving in internal marketing to produce new products meets consumer’s needs and wants. And consumer buys product form retailers. (Process The whole selling process is not really like a service. P Company is producing commodity products. Consumers can easily buy product from retailers. There is not need after selling service as some machinery companies, the products should be used for above 3 years. But we must care about P consumer’s needs and wants. The marketing research is one element related to P&G selling and developing process. (Physical Evidence Commodity always sell at supermarket or retailer shop. The environment is very important to company’s product sales.

It is including: furniture, acreage of supermarket, even the color used in the decor of service area. There are many commodity products in supermarket, in order to attract consumer P use colorful promotion paper just put P Company’s side. The paper is not only use for promotion also attract consumer’s sight. P Company produce new commodity products put the new product at special place in supermarket. E. g. in front of the commodity shelves get a space to put P’s new sample there. Internal Marketing [pic] This photograph is describing the relationship between three roles including company, employee, and customers. Company make profit not only related with customers also should take care of your employees.

Internal marketing is talking about training employee’s skills. To P Company can provide employee up date times. It is the time for employee communicates, upgrade their ability, and exchange technology information. Remember to get despondences form employees’, force on the suggestion to our companies, try to satisfy employee’s needs and wants as much as possible. We encourage them to be work hard and we give rewards for hard working employees. Help them solve their problems in order to make them work effectively. This method is good for P stay harmonization with employee. Then another main point is taking care about our consumers. We should get many profits when consumer shows us positive feedback.

We are not only selling commodity to consumers also branded our company’s name. The marketing research is necessary to know our potential consumer, even how to attract more consumers. Try to use suitable advertising transfer new products directly and effectively. Consumer and Employee is interactive relationship. Our employee also can be our consumers, mention in here there is not having clear gap between consumer and employee. This is also the reason why we should care about employee also. Employee prefers to work, and produce more quality products meet consumer’s satisfaction. P will get more benefit. Marketing Research P Company enter into Chinese market nearly 45 years.

Now its position is at maturity stage there, in order to maintain P’s consumers, beat back P&G’s competitors, and invest a future value, we should improve ourselves all the time. Primary data & Secondary data We will set 100 questionnaires to make research, in order to get as much as possible feedback from our future customers about P shampoo. It is included: the image of our brand, quality of our product, collects suggestion from responders. All of the information will be collect and filtrate, then use them to define how to achieve our goals. At one time, we will search through secondary research from Internet, newspaper, magazine and radio. Those analyzing will help us to know more from external environment. Such as our competitor, current style, population, economic environment.

Questionnaires I am taking my Bachelor in Business Administration at SHINES and have chosen to study the case of Procter & Gamble Company for my business project. I would really appreciate if you could give me a few minutes time to fill up this survey form. Any further comment will be welcome. Personal detail 1. Gender: a. Male b. Female This question is to know how many male and female of this survey 2. Age a. Below18 b. 19-25 c. 26-35 d. Over 36 This question is to know the age of responders 3. What is your occupation? This question is to know the responder’s occupation 4 What is your income level? a. elow 1000 b. 2000-4000 c. 4000-. 5000 d. above 5000 This question is to know the income level of responder Basic Question 5. How often do you wash your hair? a. Every day b. Twice or third per week This question is to research the frequency of responder wash hair 6. What is your hair type? a. Dry hair b. Creasy hair c. Normal d. I don’t know This question is to know responder’s hair type 7. What kind of hair problem have you had before? a. Dandruff b. Loss hair c. Dryness d. Oiliness This question is to research responder’s hair problems 8. Have you heard about P conditional shampoo? If the answer is “No”, please stop here) a. Yes b. No This question is to know the brand image of P’s shampoo? 9. Have you ever used P&G’s shampoo? a. Yes b. No This question is to know whether P’s shampoo satisfy responders. 10. How did you get to know P&G Company’s shampoo? a. Magazine b. Television c. Friends d. Road promotion This question is to know common advertising and promotion of P Company’s shampoo? 11. What kind of brand do you prefer in P&G’s product line? a. Head & Shoulder b. Rejoice c. Pantene d. Others This question is to know the potential selling P’s shampoo 12.

How did you find the quality of P&G’s shampoo? a. Good b. Average c. Bad This question is to know the quality of P’s shampoo 13. What is important for you in buying P&G’s shampoo? a. Price b. Brand c. Quality d. Package This question is to know the element factor to our P shampoo 14. Where do you prefer to buy P’s shampoo? a. Regie store b. Supermarket c. Retail store d. other This question is to research the convenience place for responder 15. Do you have any suggestion to P&G’s Company? If you have, please write. This question is to get feedback form customer. ——END ——Thank you for your cooperation. Data Analysis

After finish 100 questionnaires about Procter & Gamble, We go through data analysis. We got lots of responses which will help us understand how to achieve our objects there. In terms of China’s total population, now 1. 2 billion people, it is much more useful to P&G Company focus on China’s urban population and markets. (I promise that all the questionnaires were done in China. As the figure below, we will focus on gender. Figure 2. 1 Sample distributions by gender During our 100 questionnaires, the majority of the population: (52%) is formed by females. We can infer that, the population of Chinese is in majority composed by females. 48% of the sample interviewed is composed by males.

There is a small disparity between number of females and males. It’s not affect us see the whole picture perfectly. Get real information from both female and male equally. ( The population’s age phases affect how fast the country can be developed. If China does not have enough young blood, it will be a barrier to improve markets their. We can see a regularly customers to our shampoo, their age are still young. As we research their occupation, most of them are working now. They are common workers, networks, teacher, drivers, CEO of Architecture Company and etc. Most of them can afford life by themselves. Figure 2. 2 Distribution of the sample by age.

There are four stages of age. 39% of the population interviewed is aged between 19 and 25 years old, which reflects the majority of the target people of P. Then, people between 26 and 35 represent the following biggest proportion (32%). The third biggest proportion (15%) of the persons interviewed is over 36. The rest of 14% comes from age below 18. ( Every product’s selling price equal physical cost plus profit. Data about Chinese income level is linking to set appropriate price. The results if we ignore customer’s income —- If the price is too high, some of customer income can not take in hand. When the price was set too low, it leads our company to loss profit.

Our sales will decline shapely. Figure 2. 4 Sample distributions by Chinese income level There are 39/100 Chinese income below $200 from our research. The second majority group income level between ? 2000 and ? 4000 are 36/100 interviewed. Compare with second majority group interviewer, it is absolutely lesser (17/100). The highest income level only have 8 over 100 interviewed income is over ? 5000. From the figure the lower stratum take a big part of my sample. ( Ask how often our customer washes their hair to know the frequency use of shampoo. It directly affects the sales of our shampoos. The information about the frequency of hair washes between 2000 and 2001.

The ratio of wash hair two or three times per week is 39% in 2001and its 4% increase than the ration in 2000. In the same year the ration of wash hair once per week or even more less are decrease 1%. Ref: http://www. cbiq. com/brains/brains_html/newshtml/zn/20031204101755. shtml Figure 2. 5 Sample preferences on wash hair frequency per each week From my research 35over 100 of the persons interviewed wash their hair everyday. This proportion is really less than a large group of person washes their hair two or three times per week. It is 65%. The ratio of hair wash increase will increase customer needs of shampoo. That’s good to our company, its means we still have the space for developing shampoo market. The data analysis about different types of hair and hair problems, we use it for ensure the position of our products. In order to increase the sales of it and satisfy different group of our customers, we should separate them for different kind of uses. And now P&G Company have a lot of shampoo for various uses. Customer can easy find one solve their problems. To daily use market, consumers are not stability enough. It is easily to loss consumers. That’s why we should keep observe market all the time, and tries to know they taste. In the 1991s, when Head & Shoulder first came to the market, the company gets a welcome respond from consumer, because this shampoo can reduce your dandruff.

Now it’s the time for us to look at what is the biggest problem these years. Figure 2. 6/7 Sample describe about types of hair and hair problems [pic][pic] Despite the fact that 31% responder feel their hair is normal. Totally, 40% have creasy hair, according to search responder’s hair problems, 31% feel oiliness. It is the second largest group compare with the largest group responder (33%) have dandruff problem. Nearly half of responders with dry hair (22%) feel that they have problem on dryness. The percentage of loss hair is twice as 12% dryness. Only a few 7% never ever know the type of their hair. ( By the way of know how popular P is.

We directly ask responder whether they have heart or use P’s product. There is 98% customer heard of P&G. They give two or even three different names of our company’s product. That’s say our company’s brand is strong enough. From further research there are 95% of customers have try our product. Of course our company has existed in China market for 16 years. ( China’s urban consumers are also extraordinarily responsive to advertising. Advertising and promotions than their jaded counterparts in more developed markets. The secondary data from website shows in both Shanghai and Beijing, more than 87% of the population surveyed had watched TV the day before and over 80% had read a daily newspaper the day before.

Figure 2. 10 Sample distributions by promotions [pic] 49% of the persons interviewed have confessed having heart about P&G on TV. We cannot neglect the 22 persons who knew about P&G within road show, by their friends 16 persons knew P&G, the rest 11% is people knew by newspaper or magazines. For most product categories in China, as in most markets around the world, television is far and away the most important media for advertising. ( Our company has variety of shampoo, each of them has a specialty uses to help us solve different kind of problem. 38/100 of the persons interviewed replied that they are choosing Head & Shoulder settle dandruff problem.

This proportion is different from whose chose patent (29/100) and those who choose rejoice are lesser than Hand & Shoulders and Patent (19/100). The remaining (2/100) persons are choosing other shampoo. It is absolutely show that the process of selling Header & Shoulder is successfully in China. Figure 11: General opinions about variety shampoo [pic] ( To research the general opinions from our customers, finally it’s excellent respond to our answer sheet. There are 56% of the population consider P’s shampoo are a top-quality product, whereas 42% consider it as average. There is nobody think that is an awful shampoo in P&G. Figure 2. 12 General opinions about shampoo [pic] “First and foremost, as noted above, China’s consumers are quite willing to experiment, try new shampoos and brands. They are highly brand conscious, welcoming the quality and the reassurance promised by strong brands, preferably international in origin, from consumer analysis. Figure 2. 13 General opinions during choose shampoo process [pic] Despite the fact that quality is a more attention factor when consumer made decision. Which means that its quality should by theory be reasonable for everyone, the percentage is 55% of the population. The percentage of brand and price is min discriminative. It is 21% mind price. 20% pay attention on brand. Only 2% of the interviewed focused on package. The element of place for us to sell it should be pay attention. We usually see commodity in rejie store, supermarket, retails tore and other place. The chart describes which place more convenience to our consumer to buy Shampoo. Figure2. 14 General Opinions about place [pic] The most of outstanding place of selling shampoo is still supermarket. 64 of the persons interviewed have confessed buying shampoo in supermarket. We can not neglect the other ways. There are 25% of them buy shampoo in retail store. A few of them buy shampoo in rejie store (7%). 2% interviewed choose another place. ( he last question in the questionnaires is consumer giving their suggestion. Just a few of them write on the line.

They advise us set lower price, improve quality, produce varieties of shampoo help us to satisfy different kinds of Chinese consumers. There is one consumer suggest us try to use another way to advertising instead of always beautiful girl with P’s shampoo. It remind of us that consumer have differentiate and analysis advertising now. Find another way for promotion is necessary now. Pay attention that there are twelve interviewed suggest to product new shampoo stratify special taste. It will help us achieve more consumers, it meets the information from consumer analysis “most of Chinese want to try new design and welcome fresh products, when they just traveling in the supermarket they wish to find new things. ” ( THE LIMITED DURING RESEARCH PROCESS

Even though time was not an issue for this project, problems such as the lack of cooperation from some persons interviewed that is reflected in the diverse proportion of “no-opinion” people in the summarizing charts. This lack of cooperation was also reflected in the fact that some people approached denied to fill up the questionnaires or just filled it anyhow. This leads to the next issue, which was the necessity to print out again other questionnaires in order to have the total of 100, as some questionnaires’ answer was not related at all and needed to be removed. Recommendations “Marketing should focus on market creation, not market sharing. Only the paranoid survive. Adnrew Grove Former CEO, Intel An increasing realization to improve P&G must involve a renewed emphasis on growth. Growth not only provides the potential for enhanced profitability, but it also introduces vitality to an organization by providing challenges and rewards. It is simply more fun and stimulating to create growth than to improve productivity by downsizing. A renewed focus on growth does not mean that operational efficiency is ignored; only that it is not dominant. Both are needed for a successful long-term strategy. ( Ansoff’s Product market matrix |Existing |New | |Existing |Market penetration |Market Development | |New |Product Development |Diversification | Market penetration In order to achieve in existing product markets by increasing share through capturing sales held by our competitors as: Unilever. P&G should use of the market penetration, it’s build in China market and momentum that can be exploited. Furthermore, our company has experience, knowledge and resources (including human resources, physical resource as we talk in internal environment) already in place. So there is no need for the company to open a new market. Existing product markets are often attractive growth avenues. (Increase P&G Market Share Perhaps the most obvious way to grow is to improve market share. P&G based on tactical actions (such as advertising, promotion, or price reductions) (Increase market share by focusing on competitors and our consumers (Increasing Product Usage During our developing programs to increase usage, we use asking some fundamental questions about our user and the consumption system in which the product is embedded. We know what the barriers to increased use are. (Increase frequency use (Increase quality us (Revitalize the Brand Especially for P&G a leading brand, it is easy to become stale over time. The challenge is to revitalize the brand, to introduce some energy, vitality, and buzz into it. However, revitalization can occur often by simply acting young again within the same product-market-application space. Product Development

Then P&G can also use the Product Development Strategy, it is helpful to distinguish among hair care product. They include the addition of product features, the development of new-generation products, and the development of new products for an existing market. (Product Feature Addition One type of product development is the addition of features to a firm’s current product. (New Products for Existing Markets A classic growth pattern is to exploit marketing or distribution strength by adding compatible products that share customers with but are different form existing product. There is significant risk to any new product venture especially with respect to customer acceptance. (Porter’s generic strategy Target Scope |Advantage | | |Low cost |Product uniqueness | |Broad |Cost leadership Strategy |Differentiation Strategy | |(Industry wide) | | | |Narrow |Focus Strategy |Focus Strategy | |(Market Segment) |(Low cost) |(Differentiation) | (P&G’s internal, external environment and product character lead us to use differentiation strategies. “It is one in which a product offering is different from that of one or more competitors in a way that is valued by the customers. “——? strategy analysis?. Implementation

Now it’s the time for us to use marketing implementation turns marketing plans into P&G Company develop action assignments and ensures that assignments are executed to accomplish the plan’s stated objectives in China. Ansoff’s product market matrix We choose market penetration and product development to achieve win-win strategies in China, its means we satisfy our consumers’ needs and wants first and increase our benefit. It will be helpful to my company enjoy a long life in China. (Market Penetration Product P&G’s Head & Shoulder presents shampoo in the Chinese market. There are three factors we can improve about our shampoo. The same strategies can be applied in other brands of P&G’s shampoo also. (Product quality

From the survey we know that 55% of Chinese focus on quality of shampoo. (From the figure 2/13) We want to generate a more permanent share gain by delivering solid value and thereby creating customer satisfaction and loyalty. We can add some new technology to make Head & Shoulder more useful. Developing the quality of our shampoo, though, often involves more heavy lifting than designing a price promotion. Increase the loyalty of existing customers is not only much easier but also more rewarding. They will bring new customers-and a market share gain-will usually follow. (Product usage The alternative of attempting to increase usage among current customers is usually less threatening to competitors.

Greater usage can be precipitated by increasing either the frequency of use or the regular use. “The ratio of washing hair is two or three times per week is 39% in 200 1and its 4% increase than the ratio in China 2000. ” If consumers increase the frequency to wash hair, it leads positively to increase the times to use shampoo. Our consumers use our shampoo like a usual manner and it is among their lifestyle, of course we can sell more shampoo to our consumers. Effectively, we can classify them as convenience products. (Differentiate false product In China, there is another big problem—“falsification”. It will take a major part of our consumers those who are not stable; the pirate product is cheaper than ours.

In daily using market, we are not concentrating on the shampoo’s technology as IBM. We should avoid these and find a way in order to protect our patent right. E. g. use special technology can differentiate the real one and the false one apart from some law procedures. (Brand loyalty Most of these involve or emanate from a focus on quality and/or a strong brand. Brand associations should move beyond product attributes to include organizational intangibles, brand personality, symbols, emotional benefits, and self-expressive benefits. Brand loyalty reduces marketing cost, creates barriers to competition, improves the brand image, and provides time to response competitive threats. Our company also should participate in social ctivities and interactions to help people. That is a good way to make them know and aware of our products’ brand. Promotion The way for us to penetrate the Chinese market is also the use of mass advertisement. Instead of focusing only on media publicity such as TV, magazine, radio; P&G should also try to extend its promotion on road show Using advertising to transmit “do you wash hair everyday” strategy, it can be helpful to the frequency of use of Head & Shoulders. Here I have made a small advertising for Head & Shoulder. Just for “one consumer suggesting us try to use another way to advertising instead of always beautiful girl with P’s shampoo. ” figure 2/15.

It will be more reasonable to use our product, because the quality really benefits our consumers. Price We set a lower price of Head & Shoulder; it will be more attractive for our consumer. For example: provide families-size Head & Shoulder totally 750ml. The price is cheaper than consumer buying 3 times of 250ml. Price reductions were soured by passing cost reductions on to the consumer and by sharply reducing package cost, retail trade deals and consumer price promotions such as couponing. It is positive to P&G to stay in the course, deliver meaningful saving to consumers of its brands in the process, and, not incidentally, put significant pressure on the margins of its competitors. Place

As our company is producing daily necessary products, we know consumer choose convenient place to buy the products. “The most of outstanding place of selling shampoo is still supermarket. 64 of the persons interviewed have confessed buying shampoo in supermarket”, figure2/14. We choose this option which is built in the shopping center have lots of consumers. (Product development Product Here we talk about improving our product in China directly, it focuses on change of the feature addition, operate new generation products, and new products come out. (Renew design One type of product development is the addition of features to our firm’s current product. The right feature can dramatically attract more consumers.

Sometimes redo the design is not only its more fashioned and beautiful design. For example: Asking why customers do not use a product more often can lead to approach that make the product easier to use. For example: We believe that most of us have experience using shampoo to wash hair. How did you feel about that? Do you have trouble when you wash your hair if you want to add more shampoo, but it just slip out of your hand. We can change the design; it will look more beautiful and useful to keep from falling. The new design: Figure 2. 28. “They like to see some new and fresh things with the interesting design. ” secondary data from consumer analysis. (New product in China

A classic growth pattern is to exploit Chinese marketing by adding compatible shampoo that share customers with but are different from existing shampoos. For example: Our idea leads to decide to produce a new shampoo based on our survey and secondary data. “China’s consumers are quite willing to experiment, to try new products and brands. ” And “totally, 40% still think that they have creasy hair, according to search responder’s hair problems, 31% feel oiliness. It is the second largest group compare to the largest group respondents (33%) have dandruff problem. ” figure 2. 6/7, we go to produce a new shampoo which can satisfy consumers’ needs and wants. We can not ignore our competitors, they can produce new product as same as us.

So we must shape our new product, of course make sure the quality will be better than our competitors first, and provide new promotion can help our new product keeping standard. There is significant risk to new product venture especially with respect to customer acceptance. In conclusion about producing a new product, go further in marketing research to test consumers’ taste. Make sure we do not misunderstand our consumers’ needs and wants. Promotion New product needs much more advertisement in order to transmit new technology to consumers. The secondary data from website shows in both “Shanghai and Beijing, more than 87% of the population surveyed had watched TV. Directly using TV advertisement will be more effective and efficient. We use traditional way as P&G use the collaboration of Chinese stars on TV, newspaper, magazine. Let them truly feel that it is addressed to them to motivate them to purchase our new shampoo. “We can see regular customers to our shampoo, their age are still young. 39% of the population interviewed is aged between 19 and 25 years old”, when consumer became older, we should catch new young blood, give the new feeling different from their mother and father is necessary. For example: when our new product fetches for a period of time, we will hold hairdressing celebrate. It will help P&G positioning new shampoo much more correct to young consumers. Place

The place should be more attractive to new shampoo. In the early period, we are not going to put new product everywhere. The cost will be too high if we fall of new product. We choose the shopping centre; there is a lot of young consumers who want to try the new one. As we do the advertisement in marketing penetration, as same we can use here, but just change the place for consumers to try our new shampoo-shopping centre. We let our consumers to use new shampoo directly and show the results to the passerby. Of course we should make sure the new shampoo is really useful to the oiliness or dryness. For new product should be put at evidence places. Consumers see the new shampoo easily. Price

As I told previously, H&S is producing convenience products. Obviously, it is more tactical to keep customers’ loyalty so they only go straight to buy our products when they need. In fact, this category of product does not require too much planning and effort as they have to buy it periodically. Then, price is not the most important thing but we only have to be in the same range as other brands and try to achieve and meet the customers’ needs and wants. Porter’s Generic Strategies (Differentiation Strategy As reco

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