Procter and Gamble P&G Case Term Paper

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Uniform promotional messages for the products included in the same business unit can be translated by diminished costs. This aspect should not be underestimated, as promotional costs, in the form of TV, radio, paper or Internet advertisements represent an increasing share in the total marketing costs incurred by the company. By using the same promotion method, costs will be most likely cut down. Also, another important effect is the uniqueness character of the company's image throughout the world - consumers at global level could easily point out, indicate or recognize the unique characteristics of the P&G products, the features of the products that differentiate them from competition's items.

5. Innovation is the key to getting ahead of competitors. The development and launch of new products would allow the company to present their customers with higher quality and more innovative products. This way, P&G could obtain better market penetration facilities; improve the consumers' perception of the company and outpace the fierce competition from Unilever.

III. What are the potential risks associated with it?

The benefits induced by the strategy are obvious, but also some potential risks have to be discussed in relation to the commercial actions adopted by P&G. Basically, there are three risk pillars identified by specialists: standardization, closing down plants and firing workers, and increased costs incurred by the Research and Development department. In the next paragraphs, we shall discuss these topics one at a time.

First of all, a Standardization strategy assumes that the image of the company should be transmitted in a uniform manner throughout the world. This is very useful in terms of cost reduction, but it may generate problems and issues in regard to the public's acceptance of the Corporation and its products.
The main threat for P&G comes from the lack of customization of promotion, product mix and similar procedures, according to the particularities of the countries in which P&G offers its products. Due to the standard character of the corporate image and message, consumers may perceive the company in a different manner than what the management initially intended. Lack of customization leads to confusion and the corporate message is not transmitted through due to cultural differences. Confusion emerges due to imperfect translation of the corporate slogans, for instance, which results in misused words, phrases with no content, or slogans with a different message than the company's original intent. Also, the cultural differences among various countries are quite striking, especially if we consider the symbols, significance of colors or taboo subjects. If within one country, a particular promotion message transmits a particular idea, in other states the corporate information can be misinterpreted due to the above mentioned reasons.

Secondly, the operations aimed at closing down plants could negatively impact the relationship between national governments (especially in Europe) and the P&G Corporation. The central authorities in these countries can not be satisfied with the fact that manufacturing units are closing down and that unemployment levels are increasing - especially for blue-collar workers.

Nevertheless, innovation is a key element for outpacing competition. But sometimes, and this could also be the case for P&G, companies tend to place increased emphasis on innovation, deviating from the main objective of the commercial strategy - to reduce costs and increase the overall efficiency of the company......

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