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In contrast, they are facing threats of bustiest products of competitive rivals like Milliner, Johnson and Johnson and so forth. The personal care industry in I-J is very much competitive as market is developed and matured rivals want to attract the customers of others to sustain in the competitive industry. The overall profitability is decreasing slightly measured by the ROAR and ROE but sales trends are increasing every year. To keep up the market leader P&G should more invest in innovative products as well as male oriented products.
Every organization needs to have clear marketing objectives and the major routes for achieving those goals depend on marketing strategy. In this report, Procter & Gamble Company, a global colossus in the consumer products business, has selected to find UT their present and prospective marketing strategies in United Kingdom. P & G was established minion and it has long been one of the world’s most international companies with nearly annual sales $ 68 billion and nearly 56% of which are generated outside the United States.
It provides more than 300 brands including Ivory Soap, Tide, Pamper, ‘AIMS, and Pet food, Gillette, Crisis and Folders to consumers in more than 180 countries. It has 138,000 people globally who produce the products in eighty countries (Pug. Com). Here the writer has tried to find out what marketing strategies do P & G use only in UK. This report looks at various marketing strategies used by Procter & Gamble to become one of the best known brands in the world. Situational analysis Success of any business does not only depend on productivity of the employees and efficiency of the management rather there are some other internal and external factors which affect the performance of any business organization (Kettle and Armstrong). Strategic management experts stated that to achieve a competitive advantage, a company needs to follow strategies that develop existing resources, capabilities and formulate strategies that develop extra capabilities and resources Hill & Jones, 2010).
In case of Procter & Gamble, SOOT and PEST analysis would help to understand the internal and external situation of the company. 1. 1 SOOT Analysis The goal of a SOOT analysis is to create and affirm a company specific business model that will best align or match a company’s resources and capabilities to the demands of the environment in which it operates (Marketing Donuts). Managers think and develop alternative strategies and compare strategies with each other and then identify the strategies that that will create sustainable advantage. SOOT analysis includes strengths, weakness, opportunity and threats. . 1. 1 Strengths Procter & Gamble has strong brand to its name. It boasts 24 billion dollar brands and it has 50 strong leadership brands which bring nearly 90% of sales and profit in I-J. The company is in the dominant position in case of detergents, diapers and care products since it has acquired a numbers of beauty and care companies in the United Kingdom. The company has strong distribution channels, large scale in operation, lean production system, and heavy investment in research and development and higher profit margin than industry average.
It has wide global exposure with mass production in eighty countries, selling in 180 countries and efficient distribution channel. 1. 1. 2 Weakness In I-J, the consumer market for P & G is matured and there is very little possibility to expand the market. In contrast, the emerging market outperforms the mature markets like I-J over the forecast period putting P & G in a valuable position. In case of the market of I-J the company is eroded the market shares in a number of categories like bath and shower where Milliner is doing well now a days.
P & G produce health care and beauty care products mainly for women which cannot attract the most of the male customers. 1. 1. 3 Opportunities Procter & Gamble is well positioned to take advantage of growth in hair and skin care where it has strong position to grab the opportunity of absolute growth. The company mainly focuses on the research and development which brings innovation resulting making new products that explore the opportunity in different mature market like United Kingdom (Fastidiousness’s. Co. UK).
In mature and developed markets, absolute product differentiation and broad differentiation are the ways to survive and attract the new customers and P & G follows the strategy. There is a great opportunity in hair and conditioner market in I-J where the company can gain more profit by producing the health and beauty product for men. 1. 1. 4 Threats In United Kingdom, the main competitors for the P & G Company are Milliner, Johnson and Johnson and Kimberly Corporation. Many local companies provide personal care products in cheaper prices due to location advantage and cheap factors of production.
Government and international politics in home and foreign countries creates threats for the chosen company. Recession has reduced customers spending globally as price of raw materials hike, price of products are also forced to increase. 1. 2 PEST Analysis Many major companies have failed, lost their market shares or gone out from the business because of their failure to recognize and adapt to change in their external environment. The key point is that the organization needs to be tune with its often turbulent external environment and there must be a strategic fit between what external organization needs and what the organization offers.