Strategic Marketing - P&G
1. Background
Established in 1837, the Proctor & Gamble Company has grown from a small, family operated soap and candle company into the world’s largest consumer product that has the revenue of more than 83 billion US$ in 2008. Also in 2008, the company rank 5th on Fortune’s “Global Most Admired Companies” and No. 1 in the Household & Personal Products.
However, P&G was not able to maintain consistent performance throughout its history. Because of failed leadership of former CEO Mr. Durk Jagar from 1999 to 2000, P&G experienced difficult time because of inappropriate strategic direction. The company during that time was shaken from its heart as Jagar tried to implement some of the fundamental changes at the root of the consumer goods giant. Jagar’s efforts included modification of company’s culture, shifting P&G product portfolio into expensive market segments. The strategy proved failed and resulted in P&G poor performance in terms of market share, profitability, stock price as well as employees’ morale. Not until current CEO A.G. Lafley takeover in 2000, the company's profits have more than tripled. Under the new leadership and modification in the company’s strategy, the company returned to its core competences such as corporate culture, innovation, competent people, consumer understanding, go-to-market capability, sound marketing practices and scale, meanwhile struggled to adapt with social, technological, economic trends and market uncertainties.
The turnaround of P&G as the world’s leading producer of consumer goods products has many strategic implications that will be analyzed and illustrated in this case write-up. Some important strategic alternatives will be discussed and strategic recommendations will also be suggested in this essay.
2. Problem Statement:
The problems of P&G rooted from the incompetent strategic directions of Jagar. As a person who did not come from genuine P&G culture, Jagar possessed little knowledge and understanding of P&G
Established in 1837, the Proctor & Gamble Company has grown from a small, family operated soap and candle company into the world’s largest consumer product that has the revenue of more than 83 billion US$ in 2008. Also in 2008, the company rank 5th on Fortune’s “Global Most Admired Companies” and No. 1 in the Household & Personal Products.
However, P&G was not able to maintain consistent performance throughout its history. Because of failed leadership of former CEO Mr. Durk Jagar from 1999 to 2000, P&G experienced difficult time because of inappropriate strategic direction. The company during that time was shaken from its heart as Jagar tried to implement some of the fundamental changes at the root of the consumer goods giant. Jagar’s efforts included modification of company’s culture, shifting P&G product portfolio into expensive market segments. The strategy proved failed and resulted in P&G poor performance in terms of market share, profitability, stock price as well as employees’ morale. Not until current CEO A.G. Lafley takeover in 2000, the company's profits have more than tripled. Under the new leadership and modification in the company’s strategy, the company returned to its core competences such as corporate culture, innovation, competent people, consumer understanding, go-to-market capability, sound marketing practices and scale, meanwhile struggled to adapt with social, technological, economic trends and market uncertainties.
The turnaround of P&G as the world’s leading producer of consumer goods products has many strategic implications that will be analyzed and illustrated in this case write-up. Some important strategic alternatives will be discussed and strategic recommendations will also be suggested in this essay.
2. Problem Statement:
The problems of P&G rooted from the incompetent strategic directions of Jagar. As a person who did not come from genuine P&G culture, Jagar possessed little knowledge and understanding of P&G