P&G Ditribution

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Moneycontrol.com
Wed, Dec 02, 2009 at 17:42

FMCG battle: P&G turns up the heat, launches 2 products
Global giant Procter and Gamble (P&G) has stirred the FMCG (Fast Moving Consumer Goods) market in India by launching two products in the mass and mid segment. What could be the impact of this move and can we expect another round of price war between Hindustan Unilever (HUL) and P&G, CNBC-TV18's Tanvi Shukla answers. Detergents 

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Global giant Procter and Gamble (P&G) has stirred the FMCG (Fast Moving Consumer Goods) market in India by launching two products in the mass and mid segment. What could be the impact of this move and can we expect another round of price war between Hindustan Unilever (HUL) and P&G, CNBC-TV18's Tanvi Shukla answers.

Below is a verbatim transcript of Tanvi Shukla's analysis on CNBC-TV18. Also watch the accompanying video.

P&G has gone into an aggressive mode. It has launched two new variants, one in the detergent segment, which is called 'Tide Naturals' and also another one in skin care segment under the 'Olay' brand.

Idea behind the move

'Tide Naturals' will be priced at 20% discount to the core 'Tide' brand. The main idea seems to be to arrest the loss in market share in the detergent segment, which P&G had been witnessing; it lost about 1% of market share in the last one year.

Impact on HUL

Though a price war is not really expected in a big way, the way we saw in the late 1990�s but there could be some sort of lowering in prices to about 10%. It could impact the profitability of the mid segment brand such as 'Tide' for P&G and 'Rin' for HUL. It could also impact HUL�s lower segment brand 'Wheel'. If we see some sort of up trading happening to 'Tide...
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