Case Study of P&G (Marketing Issues)

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Case 5: P&G
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Company Background
Porter and Gamble (P&G), founded in 1837, is one of the biggest consumer goods company over the world. P&G sells shampoos, baby care products, medicine and food etc. It not only diversified the product range but also the product width. Therefore, P&G has several brands under one single category but aimed with different customer segments. P&G is also famous for its innovative and customer-oriented approaches. For example, it designed one kind of shampoo which is suitable for Japanese. With the competitive advantages above, P&G was developing with an appealing growth rate and became one of the top 500 companies around the world.

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Why entered “$2 a day” market segment?
In the past, P&G concentrated on medium and premium market segments. From the case, it was mentioned that P&G was too big to maintain a considerable growth rate within its existing target markets. It had to enter the bottom of pyramid, the 70% untouchable potential customers. Therefore, P&G targeted Chinese low end markets. In other words, P&G wanted to absorb Chinese living in countryside or second tier cities who earned around $2 per day.

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Marketing issues
Following P&G customer-oriented traditions, the worldwide organization also put many efforts on the new target customers. It developed a series of marketing strategies as summarized. * Customer-oriented research

P&G send employees to live in the rural areas in order to learn about the actual living style of the residents.

After that, P&G found that Chinese living in countryside concerned more about the functions and the price level of the products. Besides, P&G still had more challenges to face. Firstly, the distribution channels were dispersed and small in size. Secondly,...
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