P & G Ariel Detergent
Case Study
Procter & Gamble in Japan: From Marketing Failure to Success
Procter & Gamble (P&G), the large US consumer products company, has a well-earned reputation as one of the world's best marketers. With its 80-plus major brands, P&G generates more than $37 billion in annual revenues worldwide. Along with Unilever, P&G is a dominant global force in laundry detergents, cleaning products, and personal care products. P&G expanded abroad after World War II by exporting its brands and marketing policies to Western Europe, initially with considerable success. Over the next 30 years, this policy of developing new products and marketing strategies in the United States and then transferring them to other countries became entrenched. Although some adaptation of marketing policies to accommodate country differences was pursued, it was minimal. The first signs that this policy was no longer effective emerged in the 1970s, when P&G suffered a number of major setbacks in Japan. By 1985, after 13 years in Japan, P&G was still losing $40 million a year there. It had introduced disposable diapers in Japan and at one time had commanded an 80 percent share of the market, but by the early 1980s it held a miserable 8 percent. Three large Japanese consumer products companies were dominating the market. P&G's diapers, developed in the United States, were too bulky for the tastes of Japanese consumers. Kao, a Japanese company, had developed a line of trim-fit diapers that appealed more to Japanese tastes. Kao introduced its product with a marketing blitz and was quickly rewarded with a 30 percent share of the market. P&G realized it would have to modify its diapers if it were to compete in Japan. It did, and the company now has a 30 percent share of the Japanese market. Plus, P&G's trim-fit diapers have become a best-seller in the United States. P&G had a similar experience in marketing education in the Japanese laundry detergent market. In the early 1980s, P&G introduced its Cheer
Procter & Gamble in Japan: From Marketing Failure to Success
Procter & Gamble (P&G), the large US consumer products company, has a well-earned reputation as one of the world's best marketers. With its 80-plus major brands, P&G generates more than $37 billion in annual revenues worldwide. Along with Unilever, P&G is a dominant global force in laundry detergents, cleaning products, and personal care products. P&G expanded abroad after World War II by exporting its brands and marketing policies to Western Europe, initially with considerable success. Over the next 30 years, this policy of developing new products and marketing strategies in the United States and then transferring them to other countries became entrenched. Although some adaptation of marketing policies to accommodate country differences was pursued, it was minimal. The first signs that this policy was no longer effective emerged in the 1970s, when P&G suffered a number of major setbacks in Japan. By 1985, after 13 years in Japan, P&G was still losing $40 million a year there. It had introduced disposable diapers in Japan and at one time had commanded an 80 percent share of the market, but by the early 1980s it held a miserable 8 percent. Three large Japanese consumer products companies were dominating the market. P&G's diapers, developed in the United States, were too bulky for the tastes of Japanese consumers. Kao, a Japanese company, had developed a line of trim-fit diapers that appealed more to Japanese tastes. Kao introduced its product with a marketing blitz and was quickly rewarded with a 30 percent share of the market. P&G realized it would have to modify its diapers if it were to compete in Japan. It did, and the company now has a 30 percent share of the Japanese market. Plus, P&G's trim-fit diapers have become a best-seller in the United States. P&G had a similar experience in marketing education in the Japanese laundry detergent market. In the early 1980s, P&G introduced its Cheer