The first signs that this policy was no longer effective emerged in the 1970’s, 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. It had introduced disposable diapers in Japan and at one time had commanded an 80 percent share of the market, but by the early 1980’s 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 was to compete in Japan, It did, and the company how 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