Procter Gamble Co The in Beauty and Personal Care World PDF

PROCTER & GAMBLE CO, THE IN BEAUTY AND
PERSONAL CARE (WORLD)

July 2014
SCOPE OF THE REPORT
Scope
Disclaimer
Much of the information in this
Baby and Child-Specific Products US$15,936
briefing is of a statistical nature and,
million while every attempt has been made
to ensure accuracy and reliability,
Bath and Shower US$39,152 million Euromonitor International cannot be
held responsible for omissions or
errors.
Colour Cosmetics US$55,499 million Figures in tables and analyses are
calculated from unrounded data and
may not sum. Analyses found in the
Deodorants US$22,147 million briefings may not totally reflect the
companies’ opinions, reader
Beauty and discretion is advised.
Oral care US$43,110
Personal Care
Fragrances US$45,135 million Procter & Gamble, despite
US$454,132 million being the leading beauty and
personal care player, is losing
Hair Care US$77,075 million ground due to not adapting to
market shifts quickly enough.
Going forward, its success will
Men's Grooming US$35,441million depend on creating new
segments as it has lost ground
to its key rivals.
Skin Care US$107,248 million
Sun Care US$9,487 million
Depilatories US$4,739million
© Euromonitor International BEAUTY AND PERSONAL CARE: PROCTER & GAMBLE CO PASSPORT 2
STRATEGIC EVALUATION
COMPETITIVE POSITIONING
MARKET ASSESSMENT
GEOGRAPHIC AND CATEGORY
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
Key facts
Procter & Gamble Co, The  Procter & Gamble is the world’s leading beauty
Headquarters: Cincinnati, Ohio, USA and personal care company, accounting for an
11% market share in 2013. Beauty is the
Regional involvement: Global company’s second leading portfolio after home
Hair care, men’s grooming, care and more particularly laundry care. Within
Category involvement: oral care, skin care beauty, the company has wide coverage, but the
leading categories include hair care (30% of total
World BPC value share sales), men’s grooming (22%), oral care (16%) and
11.3% skin care (9%).
(2013):
World BPC value  It also has presence in home care, tissue and
3.7% hygiene and consumer health. The company is
growth (2012-2013):
currently undergoing rigorous restructuring with a
P&G: Sales vs Market Share 2008-2013 view to streamlining its focus. To this end, it has
60,000 12.0 made a number of divestments, including that of
snack brand Pringles.
% market share
Sales (US$ million)
50,000 11.8
40,000  Procter & Gamble also has a wide regional
11.6 presence in beauty and personal care with
30,000
11.4 operations in Asia Pacific, Western Europe,
20,000
Eastern Europe, Latin America, Middle East and
11.2
10,000 Africa and North America. Procter & Gamble’s
0 11.0 largest regional operation is in North America, as a
2008 2009 2010 2011 2012 2013 result of its presence in the US, which accounts for
Sales % Market Share over 20% of its global beauty sales.
Financial analysis
Contribution to Revenue FY2013  Procter & Gamble’s operating income for FY2013
improved over 2012, thanks to the wide-scale
Beauty restructuring the company has undertaken.
Grooming  Traditionally, Procter & Gamble operated in the
more premium tier of the pricing spectrum across
Health Care all industries, which it justified through its
breakthrough innovations, but at the onset of the
Fabric Care and Home
Care recession when consumers downgraded to
Baby Care and Family cheaper alternatives, the company lost some of
Care its customers. This coincided with its competitors
offering increasing product sophistication at
competitive price points, while Procter &
P&G: Net Sales vs Operating Income FY
Gamble’s own innovation pipeline slowed down.
Ending June 2009-2013
 Procter & Gamble acted fast, undertaking a
Operating income (US$ million)

86,000 16,000
84,000 15,500 number of cost-cutting measures such as
Net sales (US$ million)
82,000 15,000 reducing marketing and other administrative

80,000 14,500 expenses, resulting in improved margins.
78,000 14,000
 In 2012 however, the company announced a
76,000 13,500
large- scale restructuring programme including
74,000 13,000
divestments, job cuts, and common
72,000 12,500
manufacturing and redesigning platforms. The
70,000
2009 2010 2011 2012 2013
12,000
company’s operating margin dropped in 2012 due
to restructuring costs, but picked up in 2013.
Net Sales Operating Income
Timeline for P&G’s restructuring programme
• 2016 • Projected savings US$10 bilion

• 2014 • Exits pet food and MDVIP (a personalised healthcare operator)
• Announces complete redesign of end-to-end supply chains involving consolidation of
operations into multi-category sites
• Converts to common manufacturing and technology platform, designs supply systems to
allow for more online product customisation
• Consolidates customer shipping and product customisation operations into fewer distribution
centres
• Merges India, the Middle East and Africa into one IMEA region
• Integrates Greater China, ASEAN, Australia, New Zealand, Japan and Korea as Asia
• Cuts 2,300 roles
• 2013 • 4,100 job cuts
• CEO Bob Macdonald resigns
• AG Lafley returns as CEO/AG
• Lafley reorganises P&G operations into four units: Global Baby, Feminine and Family Care;
Global Beauty; Global Health and Grooming; and Global Fabric and Home Care
• Reports to have saved US$1.2 billion, exits global bleach business
• 2012 • 1,600 job cuts

• Divests Pringles
• 2012 • Announces restructuring programme including job cuts to deliver US$800 million in savings,
US$6 billion in less expensive packaging materials and planned efficiency in supply chain
and US$1 billion cut to marketing spending
P&G streamlines operations to enhance productivity
• Create, design, manufacture and

market products
GBU - Global • Focus of brand building at global,
regional and local levels
• Responsible for managing brand
Business Unit franchise building resources
• Responsible for
SMO - Sales and selling, distribution,
shelving, price and
execution and
Marketing merchandising.
Selling resources
concentrated in the
Sales and Marketing
Operations Operations
Financial comparisons for first nine months of fiscal years
P&G: Net Sales vs Operating Income for  P&G’s restructuring programme appears to be
First Nine Months FY2011-FY2014 bearing fruit for the company with net sales and
operating income for the first nine months of fiscal
70,000
2014 even higher than the same period in 2013.
 The company has stated that it is on track with its
60,000 restructuring plans. Its plan was to save US$800
million via 5,700 job cuts, which it has also achieved.
50,000
It has gone beyond its initial plan and cut a further
2,300 roles in 2014. The company also stated that
through its restructuring it aims to save another US$1
US$ million
40,000 billion by increasing the efficiency of its supply chains.

It has made good strides developing the efficiency of
30,000
its supply chains. It is in the process of redesigning its
supply chains to make them multi-category
operations, thus benefiting from greater synergy as
20,000 well as scale. Its greatest savings, however, is
expected to come from cutting back on expensive
10,000
packaging materials. It is not clear how far the
company has gone with this strategy.
 The next step is for Procter & Gamble is to increase
0
2011 2012 2013 2014 its investment in R&D since its innovation pipeline for
categories such as skin care is not very extensive.
Net Sales Operating Income
SWOT: Procter & Gamble Co, The

STRENGTHS WEAKNESSES
Leading brands Global exposure Not changing business Falling behind in

model marketing trends
 Procter & Gamble has  Procter & Gamble has  One of the key issues  Procter & Gamble still
strong brands to its wide global exposure. for Procter & Gamble is employs soft marketing
name. The company Its products are sold in that market dynamics techniques, tapping into
boasts 24 billion dollar 180 countries through have shifted, but its emotive aspects,
brands. It also claims 50 wide-ranging distribution model is yet to adapt to compared to its rivals,
leadership brands that channels including mass these changes. which are using hard
contribute 90% of its merchandisers and scientific facts to
overall sales and profit. grocery stores. convince consumers of
product efficacy.
OPPORTUNITIES THREATS
Men’s skin care Electric toothbrushes Category competition Local competition

 Gillette has strong  Procter & Gamble is the  Procter & Gamble is up  While Procter & Gamble
potential in men’s skin global leader in electric against strong faces strong competitive
care given it is a brand toothbrushes. With competition from threats from
men strongly associate increasing oral health Unilever, L’Oréal and multinationals, local
with. With men awareness and rising Colgate. In some players are also
increasingly purchasing disposable incomes in categories, Procter & increasing competitive
for themselves, P&G emerging markets, it Gamble is fast losing pressure as they match
can capitalise on this stands to benefit in the shares to these rivals. innovations with
brand. long run. competitive price points.
Procter & Gamble focuses on core businesses
Focus on core operations Focus on billion dollar brands

 To accelerate growth Procter & Gamble is  Procter & Gamble’s objective has been to focus on
implementing three key changes, which it refers to billion dollar brands. The company has 24 billion
as 40/20/10. The company aims to focus resources dollar brands spanning across a number of
on the 40 largest and most profitable businesses, categories including skin care and laundry care
accounting for 50% of sales and 70% of net with a strong global presence. The billion dollar
earnings. The next change includes focusing on brands each generate between US$1 billion and
the 20 most profitable innovations accounting for over US$12 billion in revenue. According to the
most of the portfolio revenue, and the third change company, investing in the already well-established
involves investing in 10 emerging markets most billion dollar brands has a greater potential to
critical to the company’s growth. generate returns than brands with limited presence
and less familiarity.
Brand rationalisation Improving productivity
 Instead of launching new brands or making  Procter & Gamble has announced a US$10 billion
acquisitions, the company focuses on extending productivity programme to enhance the company’s
existing brands into sub-ranges, eg Gillette Fusion performance. The programme includes funding top
as part of its “billion dollar” brand strategy. It has line growth, ensuring consumer value propositions
discontinued Max Factor in the US market. This are superior, overcoming macro headwinds and
rationalisation may save on costs but may limit the delivering better bottom line growth.
company from pursuing opportunities at both the
premium and economy ends as the company
crowds into the mid-range price segment.
MARKET ASSESSMENT
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
P&G trails behind global beauty
Procter & Gamble vs Beauty and Personal Care Market 2008-2013

6
% y-o-y growth
5
4
3
2
1
0
2008-2009 2009-2010 2010-2011 2011-2012 2012-2013
Beauty and Personal Care Procter & Gamble
 Procter & Gamble’s global  Despite the success of its  In 2013, growth continues to fall
beauty and personal care restructuring programme in as it lags behind the industry up
growth declines in 2011 across 2012, Procter & Gamble faces against competition in all its
most of its key categories. In key challenges from major major markets. The company
mature markets, consumers competitors such as L’Oréal, decided to shift focus from
trade down, while increasing Unilever and Colgate. The emerging markets to North
competition in emerging company’s brands are America, its home market where
markets means the company overstretched and not in line competition has been building,
benefits less from growth here with the industry trends where from Unilever in hair care and
than some of its competitors. brands are increasingly L’Oréal in colour cosmetics and
segmented. skin care.
Little movement at the top
 There was little movement among the world’s

Global Leading Beauty and Personal Care leading beauty and personal care manufacturers
Companies 2013 over the 2008-2013 period, with the top four
2013 % 2013 % remaining entirely unchanged. However, in 2013-
Rank Company 2014, there were some notable acquisitions, with
growth share
L’Oréal the most active in the top 10 purchasing
Procter & Gamble Co, Magic Holdings in China, Cheryl’s Cosmeceuticals
1 3.7 11.3
The in India as well as professional skin care brands
2 L’Oréal Groupe 4.8 9.7 Carita and Decléor from Shiseido.
 Market stability was also maintained by a uniformity
3 Unilever Group 7.8 8.1 of strategy among the leading players, with the
major players focusing on expansion in emerging
4 Colgate-Palmolive Co 6.2 3.8 markets, and, where possible, premiumisation.
5 Beiersdorf AG 6.2 3.0  Procter & Gamble has been finding itself in the face
of mounting competitive pressure. It has
6 Estée Lauder Cos Inc 7.6 2.9 traditionally operated at higher price points,
justifying it on the basis of ground breaking
7 Johnson & Johnson Inc 4.8 2.8 innovations, but now its rivals are matching similar
product features at competitive price points but also
8 Avon Products Inc -2.7 2.4 maintain a more segmented portfolio. Procter &
Gamble is now aiming to boost its innovation
9 Shiseido Co Ltd 0.3 2.1 pipeline, but following the economic downturn, its
margin has been narrowing, further adding to the
10 Henkel AG & Co KGaA 3.8 1.8 challenge.
MARKET ASSESSMENT
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
MARKET ASSESSMENT
Dilemma in developed vs emerging market expansion
 In terms of regional expansion, Procter & Gamble finds itself facing a dilemma. North America is the
company’s key regional market, but like many of its rivals it decided to pursue emerging market growth
more strongly. However, it found its home ground coming under increasing competitive attacks. Unilever
expanded its hair care presence, L’Oréal expanded in skin care and colour cosmetics and Colgate
threatened its oral care shares in North America. Subsequently, Procter & Gamble decided to shift focus
from emerging markets to North America.
 While this happens, Procter & Gamble is losing ground in emerging markets, where competitive pressure is
not just coming from multinationals but also local players. For example, in China local skin care players are
gaining strong ground thanks to increasing product sophistication which they can offer at competitive price
points due to more relaxed government regulations. Procter & Gamble needs to adopt an appropriate
strategy that will allow it to address competition in both North America and other emerging markets.
Procter & Gamble Co, The: BPC Presence 2013 and Growth Prospects 2013-2018 by Region
6
Middle East & Africa
% CAGR 2013-2018
5 Latin America
Asia Pacific
4
3
2 Australasia North America
Eastern Europe Western Europe
1
0
-1
0 20,000 40,000 60,000 80,000 100,000 120,000 140,000 160,000
Market size 2013 (US$ million rsp)

Note: Bubble size represents company share of category in 2013, range displayed: 8.9-16.4%
MARKET ASSESSMENT
Diverse presence across beauty industry
 Procter & Gamble has faced challenges in most of its key beauty categories. While its innovation pipeline
has been slow in recent years, impacting its market share globally, the company appears to be removed
from key market trends. Leading beauty players including L’Oréal and Unilever have been operating highly
segmented portfolios across the pricing spectrum and age groups. For example, Unilever operates a
number of brands in regular and salon-inspired hair care in different pricing segments. TRESemmé is in the
mass segment among the salon-inspired brands and Sunsilk is its counterpart in the regular segment. Dove
is the more premium range in the regular hair care category and Nexxus in salon-inspired hair care. Procter
& Gamble, on the other hand, only operates one key brand in each category, diluting them across the wider
pricing spectrum, ranging from mass to masstige. With a diluted brand image and less innovative features,
higher pricing proves detrimental for the company.
Procter & Gamble Co, The: BPC Presence 2013 and Growth Prospects 2013-2018 by Category
5.0 Baby and Child-
4.5 Sun Care Specific Products Men’s Grooming
% CAGR 2013-2018
4.0
3.5 Oral Care Skin Care
Hair Care
3.0 Depilatories
2.5
2.0 Deodorants Colour
1.5 Cosmetics
Bath and
1.0 Shower
0.5 Fragrances
0.0
-20,000 0 20,000 40,000 60,000 80,000 100,000 120,000 140,000
Market size 2013 (US$ million rsp)

Note: Bubble size represents company share of category in 2013, range displayed: 0.2-32.5%
MARKET ASSESSMENT
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
GEOGRAPHIC AND CATEGORY OPPORTUNITIES
Hair care is largest beauty portfolio for P&G
 Hair care is Procter & Gamble’s largest beauty and personal care category, and shampoos comprises more
than 50% of its total sales, with conditioners accounting for a further 20%.
 Asia Pacific is Procter & Gamble’s largest regional market, accounting for approximately 30% of its global
hair care sales. Sales in Asia Pacific mostly stem from China, accounting for nearly 60% of its Asia Pacific
hair care sales. Procter & Gamble has deep penetration in shampoos in China, controlling over 40% of the
market. It is only in China where it has greater coverage across the pricing tiers through three key brands
Rejoice, Head & Shoulders and Pantene. Rejoice is a mass-market brand, while Head & Shoulders is
positioned as a more specialised brand targeting dandruff. Pantene has smaller shares than these two and
sits in the upper pricing tier. North America and Western Europe make up some 40% of P&G’s global hair
care sales, followed by Latin America at 20%. Unlike China, Procter & Gamble does not have as strong a
presence in the mass hair care segment in the other regional markets.
P&G Hair Care Value Sales Breakdown P&G Hair Care Value Sales Breakdown by
by Region 2013 Category 2013
Shampoos
AP NA
Conditioners
WE LA Colourants
Styling Agents
EE ME&A
Salon Hair Care
Aus
Other
P&G hair care share loss in key markets
 Globally, Procter & Gamble lost 70 basis points in P&G Hair Care Market Share Movements by
hair care market share over 2008-2013. However, Category 2008/2013
% market value share

while it managed to gain 20 basis points in market 35
30
share for shampoos, it lost share in both 25
conditioners and colourants, its second and third 20
leading categories, respectively. 15
10
 Conditioners and colourants have been suffering 5
from a slow innovation pipeline and subsequently 0
falling behind its competitors. Hair oil has become
very popular as a conditioning format, but Procter
& Gamble entered the category after its key
competitors. In hair colourants, rival L’Oréal’s
Garnier Olia has been a breakthrough in mass 2008 2013
retail channels given its ease of application and
usage of oil for pigment penetration. P&G Shampoo Market Share by Region
 Procter & Gamble has also lost market share in 2008/2013
40
shampoos across all regions with the exception of
35
Latin America and Asia Pacific, but even within
% market value share 30
Asia Pacific it lost market share in its largest 25 2008
market, China. On the other hand, Procter & 20 2013
Gamble’s share growth in hair care emerged from 15
new growth frontiers including India and Indonesia. 10
In Latin America, the company is benefiting from 5
introducing its latest innovations such as Pantene 0
Age Defy. AP Aus EE LA ME&A NA WE
P&G shampoos less segmented than rivals
 It is not just a slow innovation pipeline that is  For example, from Unilever’s hair care portfolio, a
impacting Procter & Gamble’s market share in hair consumer is able to select an affordable salon-
care, but also because its hair care portfolio is less inspired brand, a product range that has proved to
segmented in terms of pricing coverage in be very successful with consumers as they are
comparison to its key hair care rival Unilever. perceived as good value for money. In addition, a
 Shampoos can be broadly classified as regular, brand portfolio covering a wider expanse of pricing
anti-dandruff, salon-inspired and organic/natural. tiers allows for greater flexibility in developing
Both Procter & Gamble and Unilever have presence across emerging markets. For example,
coverage in these hair segments, but Unilever has Unilever is able to offer Dove, TRESemmé and
wider pricing coverage in each of these segments Sunsilk to cover consumers with wider variety of
than Procter & Gamble. For example, under needs and affordability as opposed to Procter &
regular retail brands, Unilever has Dove in the Gamble which can mainly offer Pantene.
upper pricing tier and Sunsilk in the lower tier, but P&G vs Unilever Market Share in
Procter & Gamble has Pantene in the upper tier Shampoos in Developing and Emerging
and no significant coverage in the mass segment Markets 2008-2013
(with the exception of Rejoice, which is mostly

0.4
confined to China). Similarly, under salon-inspired
0.3
brands, Unilever has coverage ranging from mass
to premium, but Procter & Gamble is confined to 0.2
premium and mid-market.
0.1
 With wider coverage across the pricing spectrum
across the broad shampoo classifications, Unilever 0.0
has been able to refine its offerings to suit 2008 2009 2010 2011 2012 2013
consumer needs more closely. Procter & Gamble Unilever
Too late to fill the gaps in shampoos portfolio
 There is limited scope for Procter & Gamble to fill the pricing gaps in its hair care portfolilo. The mid-price
tier of the regular retail shampoos market is not widely covered by any key players. Procter & Gamble,
through Pantene, is present in the upper tier, while Unilever is present through Dove. On the other hand,
Unilever’s mass brand is Sunsilk. There could be a potential for Procter & Gamble to develop presence in
the mid-price market, but there are competitive challenges from affordable salon-inspired brands such as
TRESemmé. Procter & Gamble was astute in introducing more sophisticated ranges such as Pantene Age
Defy to help add value to Pantene and further distinguish it as an upscale mainstream retail brand. With an
ageing population in its key regional markets North America and Western Europe, Procter & Gamble can
expect to benefit from its ranges targeting mature women, but this would not be as beneficial in emerging
markets with younger populations.
Procter & Gamble Price range Unilever

High
Anti- Salon- Natural/ Anti- Salon- Natural/
Mainstream Mainstream
Dandruff Inspired Organic Dandruff Inspired Organic
Head & Vidal

Pantene Dove Nexxus
Shoulders Sassoon
Clairol
Aussie Herbal TRESemmé
Essences
Rejoice Clinic/
Sunsilk V05 Organics
(China) Clear
Low
Create a new segment in salon/organic hair care
 Affordable salon-inspired brands have been performing well as seen with

TRESemmé, whose value pack sizes combined with its salon heritage
have been received with considerable enthusiasm in the market.
Subsequent to its acquisition of Alberto-Culver, Unilever had introduced
TRESemmé in various emerging markets including Brazil, Thailand, India
and Indonesia, where the brand has been doing very well.
 Given TRESemmé’s good performance, the question is, should Procter &
Gamble focus on mass-market salon-inspired ranges? Procter &
Gamble’s Aussie is a similar range to TRESemmé, although Aussie is
more niche. Aussie is based on unique Australian ingredients which claim
to have effective properties for deep conditioning.
 Given that TRESemmé has already established a strong position in the
market, the competitive barriers are high, but Procter & Gamble can use
Aussie to further tap into the salon-inspired natural/organic hair care
segment and highlight the brand’s unique ingredients from Australia to
emphasise the brand’s efficacy.
 Beauty manufacturers are increasingly relying on scientific terms such as
“keratin shampoos/conditioners” or “active ingredients” to draw consumer
attention as well as convince them of product efficacy. Aussie does
highlight its unique Australian ingredients, but could use the concept to
phrase something similar to “keratin” - shorter and sounding novel and
scientific.
P&G taps into sensorial aspects of dry shampoos
 Procter & Gamble is tapping into opportunities in dry shampoos. It

launched a new range - Herbal Essences Naked Collection. The
products are infused with a mint scent that lasts long after showering,
capitalising on the sensorial trend in hair care.
.  The star product under Herbal Essences Naked Collection is its dry
shampoo. In line with all other products in the range, it focuses on the
scent experience, but also claims to be based on new tapioca pudding-
based dry shampoo technology, which claims not to leave a
concentrated white circle on the head.
 Dry shampoo under the Herbal Essences Naked Collection is an
interesting innovation since scent-infused products offer strong
potential in the dry shampoos category. Dry shampoos still comprises
a small fragment of the total hair care market, but the category has
good growth potential as the products are being positioned as for use
in conjunction with wet shampoos not only as a time saving option, but
Fragrance also to protect hair from frequent exposure to surfactants in wet
shampoos.
+
 Dry shampoos, however, still face the challenge of matching the same
Other Hair fresh feel of wet shampoo. The Naked Collection’s dry shampoo has
Benefits an edge here since the mint-infused smell can add to. the fresh feel.
Most shampoo brands, including TRESemmé, Dove and Garnier, now
have a dry shampoo range, but the olfactory claim is not as distinct as
the Herbal Essences Naked Collection dry shampoo.
Men’s grooming: High priority but men go from shaving to saving
 Within beauty and personal care, men’s grooming P&G Men’s Grooming Global Market
is a high priority category for Procter & Gamble, as Share 2008-2013
indicated by the company separating it from 34.0

beauty to form a stand-alone division in order to 33.5
be able to provide a more in-depth focus. 33.0
 Globally the company is the leading player in 32.5
men’s grooming with over 30% of value sales,
thanks to men’s razors and blades, in which it has 32.0
an unrivalled position. 31.5
 Despite its strong position in men’s grooming, its 31.0

share has been steadily declining. There are two 2008 2009 2010 2011 2012 2013
key reasons for this. The first is that it does not
have sufficient price coverage in men’s razors and
blades and the second is that it is not fully tapping P&G Men’s Grooming Value Breakdown
into the potential of men’s toiletries. by Subcategory 2013
 The company’s position in men’s razors and
blades comes mainly from its positioning in the Men's Razors and Blades
mid-price tier, but consumers have been gradually
trading down. Procter & Gamble has responded to Men's Pre-Shave
this with a breakthrough innovation, the Fusion
ProGlide with FlexBall, but it is yet to be seen if Men's Post-Shave
price-conscious consumers will upgrade,

Men's Toiletries
particularly in the face of several cheaper
alternatives..
Male consumers trade down to cheaper razors and blades
 Within men’s grooming, men’s razors and blades Top Three Players in Global Men’s
accounts for 75% of P&G’s total men’s grooming Razors and Blades 2008-2013
sales. Globally, it is by far the leading player in the 80
category, accounting for 66% of global market value.
70
 Between 2008 and 2013, the company’s share in
men’s razors and blades has been sliding. This is not
60

so much due to competition as it is to market trends.
In Western Europe and North America, which 50
together make up nearly 50% of the global men’s
razors and blades market, men appear increasingly 40
less interested in paying too much for razors and
blades, particularly in light of the economic downturn. 30
Related to their reduced willingness to pay is the
current vogue for the stubble look, leading to less 20
frequency in shaving.
10
 Cheaper alternatives are also appearing. Bic, a much
cheaper brand, recorded growth of 6% in North 0
America and Western Europe combined, compared 2008 2009 2010 2011 2012 2013
to a 1% decline for Gillette in these regions, over
2008-2013. In addition, private label has seen greater Procter & Gamble Co, The
penetration, while subscription to sites such as Dollar Energizer Holdings Inc
Shave Club and Automated Men also offer cheaper Sté Bic SA
alternatives.
P&G continues to launch in premium shaving segment
Men’s Grooming Breakdown by Shaving vs  In 2014, the company‘s new launch Fusion ProGlide
Toiletries 2013 and % CAGR 2013-2018 with FlexBall, which it claims is based on ground-
20,000 5
breaking technology, is still a launch in the upper
pricing tier. Its design claims to effectively shave the
18,000 4.5
Skin Care hard-to-reach contours of the face with a
manoeuvrable handle that offers better grip and more
16,000 4 Hair Care precise control.
Value sales (US$ million rsp)
 The question is how successful is this product likely to

14,000 3.5
Deodorants be? In light of consumers downgrading to cheaper
alternatives, the answer would appear not to be
12,000 3
Bath and Shower
launching more premium products, but instead offering
10,000 2.5 consumers products at lower price points.
Razors and
 An ongoing issue with Procter & Gamble has been its
8,000 2 Blades lack of presence in the lower pricing tiers across all
categories. The company boasts of its ground-
6,000 1.5 Pre-Shave
breaking innovations to justify premium pricing, but this
may not bear fruit in men’s shaving due to target
4,000 1 Post-Shave consumers’ strong propensity to save.
2,000 0.5  Procter & Gamble could increase its focus on men’s
% CAGR 2013- toiletries, which has much higher growth prospects in
2018
0 0 CAGR terms, but has also surpassed the market size
Men's
Shaving
Men's
Toiletries
for men’s shaving.
Men’s skin care a potential category for P&G
 Procter & Gamble has the option of tapping more Men’s Grooming Market Size Breakdown
vigorously into all categories under men’s toiletries by Region 2013
Market size (US$ million rsp)

including deodorants, skin care, hair care and bath 10,000
and shower. Men’s toiletries sales now equal those of 8,000
men’s shaving in most regions, but in Asia Pacific 6,000
men’s toiletries is larger than men’s shaving.
4,000
Furthermore, projected growth for men’s toiletries is
2,000
also higher across all regions.
0
 Deodorants is the largest category, but skin care is AP WE LA NA EE ME&A Aus
projected to be the fastest growing one with an 8%
CAGR over 2013-2018. In both men’s skin care and Men's Toiletries Men's Shaving
deodorants, P&G faces steep competition. In men’s

deodorants, Unilever is the market leader controlling Men’s Grooming Forecast Growth by
nearly 40% of the market, followed by Procter & Category by Region 2013-2018
10
Gamble, with 10% of the market. In men’s skin care,
L’Oréal controls 20% and Beiersdorf another 13%. 8
% CAGR 2013-2018
While it would be harder to penetrate deodorants due 6
to the strong dominance of Unilever due to both its 4

brand credibility and wider pricing coverage, Procter 2
& Gamble has stronger prospects in skin care due to 0
the perception of Gillette being a men’s brand
-2
compared to L’Oréal Paris which is generally AP Aus EE LA ME&A NA WE
associated as a female brand. Men's Toiletries Men's Shaving
Gillette suitable for men’s skin care
 A drawback for Gillette could be that it speaks less to Men’s Skin Care Market Size 2013 and
female consumers than a brand such as L’Oréal Paris Forecast Growth by Region 2013-2018
and this is considered an important factor given that
men’s toiletries are often picked up by their female 2,500 12
partners.
 However, this practice appears to be changing as men
10
take more interest in grooming and are now more 2,000
actively involved in the purchasing process.
Traditionally, this market was under-represented with
% CAGR 2013-2018
Market size (US$ million rsp)
8
products that men could connect with, but niche brands
such Bulldog are gradually changing the scene. Bulldog 1,500
and King of Shaves specialise in men’s toiletries with
dedicated and targeted formulations and branding 6
messages.
1,000
 Gillette, as one of the leading brands in the men’s
4
grooming category, could capitalise on this trend. It
could consider launching lines with targeted male
formulations more vigorously. It could further tap into 500
the digital media, particularly in terms of marketing such 2
products. Moreover, there are strong opportunities in

Asia Pacific, particularly in China, with the region
projected to lead absolute growth in men’s skin care 0 0
AP Aus EE LA ME&A NA WE
globally. This could also provide a much-needed boost
to the company’s overall skin care category sales. Market Size 2013 % CAGR 2013-2018
P&G slow to address shift in skin care dynamics
 Skin care is Procter & Gamble’s fourth leading beauty and personal Procter & Gamble Skin Care
care category, accounting for 9% of its total BPC sales in 2013. Market Share 2008-2013
Procter & Gamble has been losing share in skin care due to a number 5
of factors, although the overriding factor is the gradual shift in market
dynamics, which Procter & Gamble appears to have been slow to
4.9
adapt to.
 P&G’s relatively slow innovation pipeline has been blamed for its loss
in market share, but this is not entirely true. Its most recent launch 4.8
Olay Regenerist Luminous claims to be based on ground- breaking

technology. Its skin-energising technology claims to boost mature
4.7
skin’s cellular bioenergy. The line comprises facial moisturiser and
eye cream. Prior to Olay Regenerist Luminous, Olay launched an
Olay BB cream and then a CC cream. It also has a sophisticated 4.6
range of targeted products including Olay Regenerist Advanced Age-
Defying Eye Roller, which claims to instantly reduce eye puffiness,
and Regenerist Anti-Ageing Lip Treatment, which is said to moisturise 4.5
and visibly reduce the appearance of lip lines. It also has a skin care
device similar to L’Oréal’s Clarisonic, but sold at a much lower price
4.4
point and launched before L’Oréal acquired Clarisonic. It has a kit
which combines the device and Olay skin perfecting cleanser. These
ranges should have been sufficient to help the company make greater 4.3
strides in skin care market share, but its portfolio seems 2008 2009 2010 2011 2012 2013
comparatively less segmented than its competitors.
Greater segmentation in skin care portfolio needed
 The skin care market is becoming increasingly

segmented along age groups, consumer
affordability and price points, which are again Product Segmentation
interrelated.
 L’Oréal maintains three distinct divisions across
the pricing tiers. Garnier is at the mass level,
L’Oréal Paris is a mid-price brand and then it has Price
a range of premium brands. Higher concentration
of ingredients is found in the premium brands,
which are targeted at older and more mature age
groups, but lower proportions of the same
ingredients are also available in the mid-price
brand L’Oréal Paris at more affordable pricing
points. Garnier, on the other hand, is targeted at
a younger age group and often combines multiple
functions.
 Procter & Gamble mainly competes through one
brand, Olay, in skin care across the mass pricing Age Functionality
spectrum, which dilutes the brand’s image.
Consequently, even though Olay has a range of
products targeting a wide spectrum of age
groups, it is not as distinct as L’Oréal’s brands.
Overall, it appears L’Oréal has a greater variety
on offer for more diverse groups.
Not enough hype around skin care offerings
 Procter & Gamble’s loss of market share in skin care also

reflects its inability to create the same marketing hype as
enjoyed by some of its key competitors.
 L’Oréal was a pioneer in popularising the serum format and
the BB cream trend. In addition, short and scientific terms
such as “active ingredients” and/or “active molecules” help to
draw attention, while making their brands seem equally
convincing as the more descriptive explanation of the
science behind the technology. L’Oréal’s packaging around
consumer segmentation also helps to add to the hype. For
example, L’Oréal’s Skin Perfection Magic Touch Instant Blur
Cream, targeted at a younger age group, is packaged in a
pink box - the packaging clearly communicating to young
girls. On the other hand, Revitalift, designed for more mature
groups, is packaged in red - which carries more gravity and
weight attracting older age groups. In addition, a number of
world-renowned actors have been appointed to represent
the brand.
 L’Oréal’s commercials are more hard hitting. While Revitalift
uses terms such as “Triple Power”, Olay employs “Your Best
Beautiful”. At a time when skin care is taking on a more
advanced scientific form, hard-hitting catchy phrases are
likely to strike a chord with consumers over softer terms.
Shifting dynamics in China’s competitive landscape
 Some 30% of P&G’s global skin care sales come

P&G vs L’Oréal and Leading Local Players
from the world’s leading skin care market, China,
in Skin Care in China 2008-2013
but it is increasingly losing share to other
players. 12
 China is a lucrative market for all skin care L'Oréal

Groupe
manufacturers, leading to extreme competitive
pressure. While the growing competitive 10
pressure is not news, the changing competitive
Procter &
landscape deserves some attention. Gamble Co,

8
 Previously, competition came mainly from The
foreign multinationals, but now local players are
also gaining ground in terms of product Jala (Group)
sophistication, albeit positioned at more 6 Co Ltd
competitive price points due to more relaxed
government regulations for local companies.
Moreover, consumers in the lower pricing 4 Shanghai
Jahwa United
segments also prefer local brands since they can Co Ltd
identify with them more closely. This shift in
China’s competitive landscape is not only making 2
Shanghai
it necessary to have more clear segmentation Inoherb
along pricing lines, but also to create stronger Cosmetics
marketing buzz and brand excitement to Co Ltd
0
communicate the brand’s distinct and niche 2008 2009 2010 2011 2012 2013
positioning in comparison to rival brands.
Oral care more successful for P&G but falling behind rivals
 Oral care is one of Procter & Gamble’s more P&G vs Colgate: Market Share in Oral
successful categories. In 2013, Procter & Gamble Care 2008-2013
recorded 5% growth in oral care, second highest for 30

the company after deodorants, which grew by 7.5% in
the same year. 20
 Despite oral care performing well in comparison to the
company’s other categories, it was lower in 10
comparison to other key oral care players, namely
Colgate and Unilever, recording growth rates of 8% 0
2008 2009 2010 2011 2012 2013
and 6%, respectively.
 Procter & Gamble marginally lost share in global oral Colgate-Palmolive Co Procter & Gamble Co, The
care, while Colgate and Unilever both recorded

positive market share growth. While Colgate gained 60
bps in market share, Unilever’s market share grew by P&G vs Colgate: Market Share Gain in
Oral Care 2008-2013
Percentage point gain in

10 bps. This reflects how well the players performed
200
regionally. Colgate’s growth was predominantly driven
market share
by emerging markets, while Procter & Gamble 150
appears to be focusing on developed markets. 100
 While Colgate gained market share in Asia Pacific, 50
Australasia and Eastern Europe, Procter & Gamble
0
gained share in Latin America, North America and
Western Europe, with Latin America the only emerging -50
regional market in which the company recorded AP Aus EE LA ME&A NA WE
positive share growth. Colgate-Palmolive Co Procter & Gamble Co, The
Western market focus takes away P&G growth from oral care
 Given market share shifts, it appears that both P&G and P&G Oral Care Value Sales Breakdown
Colgate are streamlining their regional focus in the face by Region 2013
of intense global competition. Regional priority for each
AP
of the companies is linked to the regional balance of
their oral care portfolios. While North America and Aus
Western Europe combined account for more than 50% EE
of P&G’s global oral care sales, for Colgate this is a LA

much lower proportion. ME&A
 The more interesting story, however, is in Latin America, NA
which holds greater weight in terms of regional sales for WE

Colgate in comparison to Procter & Gamble, but Procter
& Gamble is aggressively pushing into this region.
 Procter & Gamble is capitalising on rising disposable Colgate Oral Care Value Sales
incomes in Brazil, the largest oral care market in the Breakdown by Region 2013
region. In 2012, it introduced a new range of oral care
product under its brand Oral B and appointed the LA
leading model Gisele Bündchen as the brand AP
ambassador. This has proved successful for the WE
company, contributing to its share gain in the market. On NA
the other hand, Colgate’s more economy brand Sorriso EE
has lost share, clearly indicating that Brazilian ME&A
consumers are looking for more sophisticated products Aus
for their oral care regimen.
Focusing on targeted benefits to help P&G oral care
 In order to beat its rivals in oral care globally, P&G

P&G vs Colgate in Oral Care: Share and
needs to develop a stronger presence in other
Ranking by Region 2013
emerging markets. In Asia Pacific, Eastern Europe and
Latin America, Procter & Gamble forms a distant Procter &
second to Colgate and in the Middle East and Africa it Colgate Gamble
ranks number four. With the exception of Latin
America, Procter & Gamble lost share in all these %
Region % share Rank Rank
regional markets. share
 One common problem for Procter & Gamble is that it is
positioned as more premium and hence less AP 24.2 1 11.4 2
accessible to consumers with lower affordability.
Aus 46.0 1 14.2 3
Combined with this, in some markets, such as China,
local competitors are also coming up with oral care
EE 27.0 1 19.0 2
products with more sophisticated functionality. In some
markets, Colgate has region-specific brands, such as LA 51.1 1 16.3 2
Darlie, accessible to consumers with lower affordability.
 The question for Procter & Gamble is what would form ME&A 25.8 1 14.2 4
an appropriate strategy to expand in emerging
markets. It does not have the option of including a new NA 18.1 2 33.7 1
mass brand, given the cost implications. It can continue
with further segmentation offering more closely WE 19.1 1 18.9 2
targeted benefits to justify its premium positioning, but
also take advantage of higher pricing margin.
Long-term potential for electric toothbrushes
 Procter & Gamble also has the option of taking a long-term view on emerging market oral care. Procter &
Gamble is the global leader in electric toothbrushes, which it can capitalise on.
 With ever-growing oral health awareness globally, there is a good opportunity for electric toothbrushes,
which are designed to cleanse bacteria more effectively, preventing tartar and plaque.
 Penetration of electric toothbrushes is higher in Western markets due to higher affordability, but there are
opportunities for further growth with consumers upgrading from manual toothbrushes. In emerging markets,
higher cost is a deterrent, but with increasing disposable incomes more consumers could be expected to
upgrade in the long run.
P&G Oral Care Presence 2013 and Growth Prospects 2013-2018 by Category
3,000 6
% CAGR 2013-2018
(US$ million)
Value sales
4
2,000
2
1,000
0
0 -2
Toothpaste Manual Electric Mouthwashes/ Battery Dental Denture Tooth Mouth
Toothbrushes Toothbrushes Dental Rinses Toothbrushes Floss Care Whiteners Fresheners
2013 % CAGR 2013-2018
Electric Toothbrushes Market Size 2013 and Growth Prospects 2013-2018 by Region
(US$ million rsp)
2,000 10
2013-2018
Market size
% CAGR
Market Size 2013
1,000 5
‘% CAGR 2013-2018
0 0
WE NA AP LA EE Aus ME&A
Long-term potential for electric toothbrushes
 Mouthwashes/dental rinses is a category that offers greater prospects in the near future. The global
forecast, at over 4% CAGR, for mouthwashes/dental rinses is the highest among the oral care categories.
 Increasing oral care awareness is expected to drive growth as consumers adopt a multi-care routine
including brushing, followed by mouth rinsing. While they are well established in North America, sales are
expected to grow in Western Europe as well as other emerging markets. Unlike electric toothbrushes,
mouthwashes/dental rinses are affordable in addition to their claims of addressing oral care issues with
greater effectiveness than simply brushing.
Mouthwashes/Dental Rinses Growth Prospects by
 Johnson & Johnson is the global leader Region 2013-2018
with Listerine, but the brand’s market 450 14
Absolute Value Growth (US$ million) 2013/2018

share has fallen as its parent focuses on
400
other divisions. Procter & Gamble is the 12
second leading player, but its market 350
% CAGR 2013-2018
share remained static, while Colgate, the 10
300
third leading player gained share in 2013.
P&G’s presence in this category revolves 250 8
primarily around North America. It would 200 6

benefit from expanding its presence in
other emerging markets. 150
4
 While there are competitive barriers in 100
emerging markets, the category is still in 2
50
its nascent stage. Good product
development and effective marketing 0 0
AP Aus EE LA ME&A NA WE
campaigns could help to overcome such
competitive barriers. Absolute Value Growth (US$ million) 2013/2018 ‘% CAGR 2013-2018
Competitive barriers for colour cosmetics and bath and shower
P&G targets Middle East & Africa for colour Potential for Olay in bath and shower
cosmetics
 Colour cosmetics is one of Procter & Gamble’s  Bath and shower is another smaller category,
smaller BPC categories, accounting for 6% of its accounting for 4% of P&G’s total BPC sales globally;
global BPC value sales. The company’s presence with China accounting for more than 30% of its global
in colour cosmetics derives primarily from North sales in the category, followed by the US, contributing
America, contributing over 40% of its global colour over 20%.
cosmetics sales. The company’s leading brand is  In terms of regional prospects, Procter & Gamble is
Cover Girl, a mass brand. It also owns Max Factor, well placed since absolute growth in the category will
another mass brand, which was withdrawn from be driven by the US and China. Procter & Gamble has
the US in 2009, and SKII, a premium brand, a well-segmented portfolio offering a wide range of
present mainly in Asia Pacific. brands.
 In 2013, Procter & Gamble lost 10 bps in global  It has extended Olay in bath and shower, although
colour cosmetics market share. This was mainly penetration is still limited. As seen with Dove, Procter
due to loss of market share in North America, & Gamble has the potential to further extend Olay in
where it faces strong competition from L’Oréal bath and shower as a brand specialising in skin care.
investing in both product development and
 Procter & Gamble could use Olay bath and shower to
marketing. While Procter & Gamble faces intense
market in India, projected to be the third leading
competition in its key market, it is building share in
market to drive growth in this category. Unilever,
the Middle East, with strong growth prospects in
however, dominates India with nearly 50% market
percentage terms. It is using Max Factor to drive
share mainly through Lux. Procter & Gamble could
share; a good move given the brand’s heavy
break into this market with Olay, but needs to be quick
coverage, which sits well with regional tastes.
since Dove is growing rapidly.
MARKET ASSESSMENT
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
BRAND STRATEGY
Gillette enjoys broad geographic reach
 Gillette is Procter & Gamble’s leading beauty and

Gillette Regional Breakdown 2013
personal care brand and the world’s number two
BPC label. It is one of the company’s billion dollar
brands, with sales of US$12 billion in 2013. Gillette
is among Procter & Gamble’s most diverse brands
in terms of geographic profile. It ranked number
one in every regional men’s grooming market in
2013.
 The US is P&G’s leading market for Gillette,
followed by Brazil. Given that the Brazilian market
is set to lead growth in men’s grooming over 2013-
2018 this puts the Gillette brand in a very
favourable position.
 The Gillette brand is positioned as mass, however
Procter & Gamble has been branching out to
premium men’s grooming with the Art of Shaving,
which it launched in the UK in 2011, but with
Asia Pacific Australasia
product sophistication increasingly found under
mass brands, premium brands face intense Eastern Europe Latin America
competition. To this end, the focus is more on
Middle East and Africa North America
Gillette, which has expanded into skin care, hair
care, deodorants and fragrances in addition to its Western Europe
most recent launch Fusion ProGlide with FlexBall.
BRAND STRATEGY
Procter & Gamble aims for more premium image for Pantene
 Pantene is Procter & Gamble’s leading hair care brand Pantene Global Hair Care Market
and the world’s number two hair care label. It is one of Share 2011-2013
the company’s billion dollar brands, with sales of US$5 8
billion in 2013.
 Pantene has been something of a problematic brand 7
for Procter & Gamble in recent years, due in part to an
overweight portfolio and confusion over its positioning.
Moves to push the mass brand upmarket have been 6
undermined by significant price cuts in core markets.

 In recent years, Procter & Gamble has been trying to 5
revive the brand. It relaunched the brand with improved
formulation and packaging in 2012. In 2011, Procter &
Gamble switched to plant-based PET for its Pantene 4
Nature Fusion bottles to maintain a consistent “natural”
image for the brand. The Nature Fusion range was 3
rolled out in 2011 and 2012 to new markets including
Thailand. In 2012, it launched Pantene Age Defy for
mature hair, which it also introduced in Brazil. 2
 The brand relies heavily on celebrity brand
ambassadors including most recently US actress 1
Zooey Deschanel. In keeping with Procter & Gamble’s
global aspirations however, it has also enlisted Indian
personalities such as Padma Lakshmi. 0
2011 2012 2013
BRAND STRATEGY
Procter & Gamble looks to cross-category branding for Olay
 Olay is one of Procter & Gamble’s billion dollar beauty Olay Global Market Share in Skin Care
and personal care brands, with sales of US$3.7 billion 2011-2013
in 2013. It generates over 85% of its revenue in skin 4
care, where it is the world’s number three brand
underpinned by its number two position in facial skin
care.
 The brand’s strong exposure to skin care provides a
strong base for innovation, and has met with notable 3
success through anti-ageing extensions, such as
Regenerist, Definity and Pro-X Intensive previously. In

2014, it launched Olay Regenerist Luminous based on
skin-energising technology designed to boost mature
skin’s cellular bioenergy. The line comprises facial 2
moisturiser and eye cream. Olay, however, is coming
under strong competitive pressure in key markets such
as China, where its competitors are expanding their
distribution coverage through distinctive brands
including that of parapharmacies/drugstores. 1
 Procter & Gamble has begun to leverage the strength
of the Olay brand in other key brands. It launched the
Venus & Olay razor in a high-profile marketing
campaign. It also continued to extend Cover Girl with
Olay as part of the Simply Ageless line, but these 0
remain limited. 2011 2012 2013
MARKET ASSESSMENT
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
OPERATIONS
P&G emerging market manufacturing sites by country 2013
Western Europe:
Turkey
Eastern Europe:
Russia, Czech
Republic, Romania
Asia Pacific:
China, India,
Philippines, Vietnam
Middle East and Africa:
Egypt, Lebanon,
Morocco, Saudi Arabia
Latin America:
Argentina, Colombia,
Mexico, Brazil,
Guatemala, Peru,
Venezuela
MARKET ASSESSMENT
OPPORTUNITIES
BRAND STRATEGY
OPERATIONS
RECOMMENDATIONS
RECOMMENDATIONS
In need of greater alignment with market dynamics
Create new segments Scientific overtones in its marketing messages
 While Procter & Gamble is losing ground due to its  The company’s marketing messages are also not
lack of coverage in the mass segment, slow in line with current trends. It continues to tap into
innovation pipeline and outdated marketing the emotive aspects of product experience using
messages, it has the opportunity to create new phrases such as “Your Best Beautiful” for Olay or
segments by combining some of the existing “Be Strong and Shine” for Pantene, while its rivals
marketing segments. For example, while it would are turning to more hard-hitting scientific terms to
be harder for Procter & Gamble to compete with convince consumers of product efficacy. For
Unilever in salon-inspired hair care segment, it can example, L’Oréal refers to “active ingredients” and
market Aussie as a salon-inspired natural/organic Unilever makes use of “keratin” as part of product
brand. claims.
 Given the strong competitive pressure in most of  This is in line with the sophistication that beauty
the categories in which it competes, a significant categories are increasingly assuming. Procter &
part of its future growth trajectory will depend on Gamble would benefit from using similar short and
creating new segments. catchy, but scientific terms as part of its marketing
strategy.
FOR FURTHER INSIGHT PLEASE CONTACT
Oru Mohiuddin
Senior Analyst – Beauty & Personal Care
Oru.Mohiuddin@euromonitor.com
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PROCTER & GAMBLE CO, THE IN BEAUTY AND

PERSONAL CARE (WORLD)

Sun Care US$9,487 million

Operating income (US$ million)

82,000 15,000 reducing marketing and other administrative

Timeline for P&G’s restructuring programme

• 2016 • Projected savings US$10 bilion

• 2012 • 1,600 job cuts

P&G streamlines operations to enhance productivity

• Create, design, manufacture and

Financial comparisons for first nine months of fiscal years

40,000 billion by increasing the efficiency of its supply chains.

SWOT: Procter & Gamble Co, The

Leading brands Global exposure Not changing business Falling behind in

Men’s skin care Electric toothbrushes Category competition Local competition

Procter & Gamble focuses on core businesses

Focus on core operations Focus on billion dollar brands

P&G trails behind global beauty

Procter & Gamble vs Beauty and Personal Care Market 2008-2013

Beauty and Personal Care Procter & Gamble

Little movement at the top

 There was little movement among the world’s

Dilemma in developed vs emerging market expansion

Market size 2013 (US$ million rsp)

Diverse presence across beauty industry

Market size 2013 (US$ million rsp)

Hair care is largest beauty portfolio for P&G

P&G hair care share loss in key markets

% market value share

P&G shampoos less segmented than rivals

% market value share

consumer needs more closely. Procter & Gamble Unilever

Too late to fill the gaps in shampoos portfolio

Procter & Gamble Price range Unilever

Head & Vidal

Create a new segment in salon/organic hair care

 Affordable salon-inspired brands have been performing well as seen with

P&G taps into sensorial aspects of dry shampoos

 Procter & Gamble is tapping into opportunities in dry shampoos. It

Men’s grooming: High priority but men go from shaving to saving

% market value share

an unrivalled position. 31.5

 Despite its strong position in men’s grooming, its 31.0

price-conscious consumers will upgrade,

Male consumers trade down to cheaper razors and blades

% market value share

P&G continues to launch in premium shaving segment

 The question is how successful is this product likely to

Men’s skin care a potential category for P&G

Market size (US$ million rsp)

deodorants, P&G faces steep competition. In men’s

to the strong dominance of Unilever due to both its 4

Gillette suitable for men’s skin care

products. Moreover, there are strong opportunities in

P&G slow to address shift in skin care dynamics

% market value share

Greater segmentation in skin care portfolio needed

 The skin care market is becoming increasingly

Not enough hype around skin care offerings

 Procter & Gamble’s loss of market share in skin care also

Shifting dynamics in China’s competitive landscape

 Some 30% of P&G’s global skin care sales come

 China is a lucrative market for all skin care L'Oréal