10.18.11
1. Procter & Gamble
Cincinnati, OH
www.pg.com
Beauty & Grooming Sales:
$28.2 billion (includes Beauty Sales: $20.2 billion; Grooming Sales: $8 billion)
Corporate Sales:
$82.6 billion
Key Personnel:
Robert A. McDonald, chairman of the board, president and chief executive officer; Bruce Brown, chief technology officer; Jon R. Moeller, chief financial officer; Werner Geissler, vice chairman-global operations; Dimitri Panayotopoulos, vice chairman–global business units; Virginia C. Drosos, group president-global female beauty, Beauty & Grooming; Patrice Louvet, president-global male grooming, Beauty & Grooming; Colleen E. Jay, president-global female beauty, Beauty & Grooming; John P. Goodwin, president-global Braun, Beauty & Grooming; Joanne Crewes, president-global prestige, Beauty & Grooming; Adil Mehboob-Khan, president-global salon professional, Beauty & Grooming; Steven D. Bishop, group president-global feminine care.
Major Products/Brands:
Mass, prestige and salon cosmetics, fragrance, hair care, skin care and grooming care marketed under a wide variety of brands including Braun, CoverGirl, Dolce & Gabbana, Fekkai, Gillette, Head & Shoulders, Herbal Essences, Hugo Boss, Max Factor, Nioxin, Olay, Pantene, Rejoice, SK-II and Wella.
New Products:
Clairol Nice ’n Easy Foam, Cover Girl Intense Shadowblast Mascara, Gucci Guilty Women’s fragrance, Head & Shoulders Itchy Scalp Care, Herbal Essences Hello Hydration, Olay Pro-X Clear Acne Protocol, Sassoon Demi-Monde.
Comments:
In a challenging year—one on which P&G’s Robert A. McDonald, chairman of the board, president and chief executive officer, commented, “This is good performance in a very demanding business and economic environment. It is not yet great performance”—the global consumer products giant managed to pull ahead of last year’s figures, due in large part to targeted growth in diametrically different channels: mass market product offerings in developing regions as well as prestige brands in established areas. For the year ended June 30, 2011, total net sales increased 5% to $82.6 billion.
Beauty accounted for almost a quarter (24%) of net sales, increasing 3% over the previous year to $20.2 billion on unit volume growth of 4%. Net sales were reportedly impacted 2% due to disproportionate growth in developing regions, which have lower than segment average selling prices, and declines in the higher-priced Prestige Products and Salon Professional categories.
Volume in developing regions increased double digits, while volume in developed regions declined low single digits. Volume in Retail Hair Care grew mid-single digits behind growth in all regions except North America. Developing regions grew double digits thanks to Pantene, Head & Shoulders and Rejoice with expanded distribution and market growth. There was a mid-single-digit decline in North America due to competitive products. Global market share of the hair care category rose slightly. Volume in Female Beauty was up low single digits mostly due to higher shipments of Olay, Venus and Safeguard, as well as expanded growth in developing markets. Volume in the Salon Professional category declined high single digits, due to downsizing brands and a weaker demand.
Volume in Prestige Products declined low single digits due in part to eliminating minor brands and lower shipments in Western Europe. However, volume increased low single digits due to growth of Dolce & Gabbana and Gucci fragrance brands.
Grooming accounted for 9% of net sales, which increased 5% to $8 billion on volume growth of 3%. Price increases on blades and razors in Latin America and developed regions contributed 2% to net sales growth. Volume grew high single digits in developing regions and decreased low single digits in developed regions. Gillette Fusion shipments increased double digits behind the continued expansion and success of Fusion ProGlide, while Mach3 shipments increased low single digits due to growth in developing regions.
Overall, there was mid-single-digit growth in the Beauty& Grooming segment in all geographic areas.
By region, North America remained the largest segment, accounting for 41% of net sales; Western Europe was second at 20%; Central & Eastern Europe, Middle East & Africa region accounted for 14%; Latin America, 9%; and Asia, 16%. P&G Brazil has grown sevenfold in just 10 years, with strong double-digit growth in fiscal 2011.
While Beauty sales increased modestly this year, P&G’s ongoing goal is to reach out and touch more people’s lives. As they currently claim to reach 4.4 billion consumers, this leaves nearly 3 billion potential customers throughout the world.
New goals often call for new leadership and, earlier this year, P&G announced what many viewed as a management shakeup, designed to inject new ideas into future development projects.
Personnel changes continue to be announced, with many respected industry veterans retiring.
Most surprising, perhaps, was the announcement that Edward D. Shirley, vice chairman, Beauty and Grooming, would retire from P&G, effective January 1, 2012, after 33 years of service.
Then came the much speculated-upon appointment of Dimitri Panayotopoulos, vice chairman-Global Household Care, to vice chairman-Global Business Units, assuming responsibility for both the Beauty and Grooming and Household Care businesses.
Patrice Louvet, former president, Global Prestige, was appointed president, Global Male Grooming, succeeding Charles V. Bergh who retired from P&G after 28 years.
Joanne Crewes, formerly vice president, Global SKII and Female Beauty, Australasian, ASEAN, India, Japan and Korea, replaces Louvet as president, Global Prestige.
In March, Christopher de Lapuente, group president, Global Hair Care, P&G, left to join Sephora. In April, P&G announced that Robert Jongstra, president, Global Salon Professional, would retire. The same month, Craig Bahner, vice president of North America, Hair Care and Color, said he would leave the company.
At the end of August, John Perry, senior vice president for P&G’s Salon Professional Open Lines, and a 33-year veteran of the salon industry, announced his retirement.
P&G is also reducing and redirecting areas other than its leadership. There’s also a focus on simplifying product lines, transportation, warehousing and packaging. The manufacturer cites packaging simplification as “another big opportunity” for reducing costs and adding to the bottom line. P&G spends over $5 billion annually on packaging materials and more than $250 million on packaging development costs, including salaries for more than 3,000 employees. McDonald says the company is now implementing virtualized end-to-end packaging development tools, “which we believe can drive a 30% reduction in packaging costs and release 30% of the time spent today on package design.”
P&G has also been making the most of standard HDPE bottles. For example, according to a report from Euromonitor, P&G revamped its packaging design for the Vidal Sassoon brand in early 2010, in Taiwan. The new bottle has a round bottom and gradually evolves into a square bottle at the top. Compared to other standard shampoo and conditioner products in Taiwan, Euromonitor says the new bottle makes it look more like a professional hair care brand, enabling the product to retail at a higher price.
Meanwhile, custom design remains strong for P&G’s Prestige stable, where beautiful packaging pays off. Gucci Guilty won a number of FiFis this year, including Best Packaging of the Year-Women’s Luxe.
Sustainable packaging also plays a growing role. In 2010, P&G announced plans to use 100% recyclable rigid plastic for select Pantene, CoverGirl and Max Factor products. This renewable packaging, supplied by Braskem SA, in Brazil, is based on a new material, which is produced by an innovative process that converts sugar cane into HDPE. (For more info, please see www.beautypackaging.com)
In February of this year, the company announced its commitment to pursue LEED certification for all new sites, including its Taicang plant in China.
P&G hit some outstanding marketing high notes in 2010, perhaps most noticeably with Old Spice’s “Smell Like a Man, Man,” which first launched in North America in February 2010, just before the Super Bowl. It has generated 33 million YouTube views and 4 billion total impressions. Within three months of the campaign’s first appearance, volume of Old Spice body wash rose 40%.
In 2011, in an effort to restore some of Pantene’s sales shine, actresses Eva Mendes and Naomi Watts were announced as new celebrity ambassadors for the brand.
In Japan, P&G launched a complete line of Pantene products specifically geared toward regional hair regimens that call for multiple products, following up to eight steps throughout the day, including nighttime, morning and mid-day treatments.
Jennifer Lopez was also signed to contribute her smooth star appeal as global ambassador—and Venus Goddess—for Gillette’s Venus razor.
Management and superstars aside, innovation remains the driving force behind P&G’s strategy, with R&D investments of about $2 billion a year. In 2010, P&G launched eight of the top 25 most successful new products in the consumer products industry in North America, as measured by SymphonyIRI Group.
Cincinnati, OH
www.pg.com
Beauty & Grooming Sales:
$28.2 billion (includes Beauty Sales: $20.2 billion; Grooming Sales: $8 billion)
Corporate Sales:
$82.6 billion
Dimitri Panayotopoulos, vice chairman–global business units |
Virginia C. Drosos, group president-global female beauty, Beauty & Grooming |
Robert A. McDonald, chairman of the board, president and chief executive officer; Bruce Brown, chief technology officer; Jon R. Moeller, chief financial officer; Werner Geissler, vice chairman-global operations; Dimitri Panayotopoulos, vice chairman–global business units; Virginia C. Drosos, group president-global female beauty, Beauty & Grooming; Patrice Louvet, president-global male grooming, Beauty & Grooming; Colleen E. Jay, president-global female beauty, Beauty & Grooming; John P. Goodwin, president-global Braun, Beauty & Grooming; Joanne Crewes, president-global prestige, Beauty & Grooming; Adil Mehboob-Khan, president-global salon professional, Beauty & Grooming; Steven D. Bishop, group president-global feminine care.
Major Products/Brands:
Mass, prestige and salon cosmetics, fragrance, hair care, skin care and grooming care marketed under a wide variety of brands including Braun, CoverGirl, Dolce & Gabbana, Fekkai, Gillette, Head & Shoulders, Herbal Essences, Hugo Boss, Max Factor, Nioxin, Olay, Pantene, Rejoice, SK-II and Wella.
New Products:
Clairol Nice ’n Easy Foam, Cover Girl Intense Shadowblast Mascara, Gucci Guilty Women’s fragrance, Head & Shoulders Itchy Scalp Care, Herbal Essences Hello Hydration, Olay Pro-X Clear Acne Protocol, Sassoon Demi-Monde.
Comments:
In a challenging year—one on which P&G’s Robert A. McDonald, chairman of the board, president and chief executive officer, commented, “This is good performance in a very demanding business and economic environment. It is not yet great performance”—the global consumer products giant managed to pull ahead of last year’s figures, due in large part to targeted growth in diametrically different channels: mass market product offerings in developing regions as well as prestige brands in established areas. For the year ended June 30, 2011, total net sales increased 5% to $82.6 billion.
Head & Shoulders, one of P&G’s billion-dollar brands, grew double digits in developing regions. |
Beauty accounted for almost a quarter (24%) of net sales, increasing 3% over the previous year to $20.2 billion on unit volume growth of 4%. Net sales were reportedly impacted 2% due to disproportionate growth in developing regions, which have lower than segment average selling prices, and declines in the higher-priced Prestige Products and Salon Professional categories.
Volume in developing regions increased double digits, while volume in developed regions declined low single digits. Volume in Retail Hair Care grew mid-single digits behind growth in all regions except North America. Developing regions grew double digits thanks to Pantene, Head & Shoulders and Rejoice with expanded distribution and market growth. There was a mid-single-digit decline in North America due to competitive products. Global market share of the hair care category rose slightly. Volume in Female Beauty was up low single digits mostly due to higher shipments of Olay, Venus and Safeguard, as well as expanded growth in developing markets. Volume in the Salon Professional category declined high single digits, due to downsizing brands and a weaker demand.
Volume in Prestige Products declined low single digits due in part to eliminating minor brands and lower shipments in Western Europe. However, volume increased low single digits due to growth of Dolce & Gabbana and Gucci fragrance brands.
Olay Regenerist Micro-Sculpting Cream remains a top seller for P&G. |
Overall, there was mid-single-digit growth in the Beauty& Grooming segment in all geographic areas.
By region, North America remained the largest segment, accounting for 41% of net sales; Western Europe was second at 20%; Central & Eastern Europe, Middle East & Africa region accounted for 14%; Latin America, 9%; and Asia, 16%. P&G Brazil has grown sevenfold in just 10 years, with strong double-digit growth in fiscal 2011.
While Beauty sales increased modestly this year, P&G’s ongoing goal is to reach out and touch more people’s lives. As they currently claim to reach 4.4 billion consumers, this leaves nearly 3 billion potential customers throughout the world.
New goals often call for new leadership and, earlier this year, P&G announced what many viewed as a management shakeup, designed to inject new ideas into future development projects.
Personnel changes continue to be announced, with many respected industry veterans retiring.
Most surprising, perhaps, was the announcement that Edward D. Shirley, vice chairman, Beauty and Grooming, would retire from P&G, effective January 1, 2012, after 33 years of service.
Then came the much speculated-upon appointment of Dimitri Panayotopoulos, vice chairman-Global Household Care, to vice chairman-Global Business Units, assuming responsibility for both the Beauty and Grooming and Household Care businesses.
Patrice Louvet, former president, Global Prestige, was appointed president, Global Male Grooming, succeeding Charles V. Bergh who retired from P&G after 28 years.
Joanne Crewes, formerly vice president, Global SKII and Female Beauty, Australasian, ASEAN, India, Japan and Korea, replaces Louvet as president, Global Prestige.
In March, Christopher de Lapuente, group president, Global Hair Care, P&G, left to join Sephora. In April, P&G announced that Robert Jongstra, president, Global Salon Professional, would retire. The same month, Craig Bahner, vice president of North America, Hair Care and Color, said he would leave the company.
At the end of August, John Perry, senior vice president for P&G’s Salon Professional Open Lines, and a 33-year veteran of the salon industry, announced his retirement.
P&G is also reducing and redirecting areas other than its leadership. There’s also a focus on simplifying product lines, transportation, warehousing and packaging. The manufacturer cites packaging simplification as “another big opportunity” for reducing costs and adding to the bottom line. P&G spends over $5 billion annually on packaging materials and more than $250 million on packaging development costs, including salaries for more than 3,000 employees. McDonald says the company is now implementing virtualized end-to-end packaging development tools, “which we believe can drive a 30% reduction in packaging costs and release 30% of the time spent today on package design.”
P&G has also been making the most of standard HDPE bottles. For example, according to a report from Euromonitor, P&G revamped its packaging design for the Vidal Sassoon brand in early 2010, in Taiwan. The new bottle has a round bottom and gradually evolves into a square bottle at the top. Compared to other standard shampoo and conditioner products in Taiwan, Euromonitor says the new bottle makes it look more like a professional hair care brand, enabling the product to retail at a higher price.
Meanwhile, custom design remains strong for P&G’s Prestige stable, where beautiful packaging pays off. Gucci Guilty won a number of FiFis this year, including Best Packaging of the Year-Women’s Luxe.
Sustainable packaging also plays a growing role. In 2010, P&G announced plans to use 100% recyclable rigid plastic for select Pantene, CoverGirl and Max Factor products. This renewable packaging, supplied by Braskem SA, in Brazil, is based on a new material, which is produced by an innovative process that converts sugar cane into HDPE. (For more info, please see www.beautypackaging.com)
In February of this year, the company announced its commitment to pursue LEED certification for all new sites, including its Taicang plant in China.
P&G hit some outstanding marketing high notes in 2010, perhaps most noticeably with Old Spice’s “Smell Like a Man, Man,” which first launched in North America in February 2010, just before the Super Bowl. It has generated 33 million YouTube views and 4 billion total impressions. Within three months of the campaign’s first appearance, volume of Old Spice body wash rose 40%.
In 2011, in an effort to restore some of Pantene’s sales shine, actresses Eva Mendes and Naomi Watts were announced as new celebrity ambassadors for the brand.
In Japan, P&G launched a complete line of Pantene products specifically geared toward regional hair regimens that call for multiple products, following up to eight steps throughout the day, including nighttime, morning and mid-day treatments.
Jennifer Lopez was also signed to contribute her smooth star appeal as global ambassador—and Venus Goddess—for Gillette’s Venus razor.
Management and superstars aside, innovation remains the driving force behind P&G’s strategy, with R&D investments of about $2 billion a year. In 2010, P&G launched eight of the top 25 most successful new products in the consumer products industry in North America, as measured by SymphonyIRI Group.