If you are going to advertise disposable diapers, fabric softeners, cleansers, toothpaste, soap or dishwashing liquids, you are going to find yourself up against Procter & Gamble. They have market shares of at least 40 per cent in all these categories, plus powerful positions in shampoo, cake mix, coffee, anti-perspirants and home permanents. They spend $700,000,000 a year on advertising, more than any other company, and their sales are $12,000,000,000 a year.
Your chances of competing successfully against this juggernaut will be improved if you understand the reasons for its overwhelming success, so I am going to tell you what my partner Kenneth Roman has learned about them.
First, P&G is disciplined. Their guiding philosophy is to plan thoroughly, minimize risk, and stick to their proven principles.
To get a broad trial quickly, they distribute home-delivered samples on a massive scale. In 1977 their Chairman said, ‘The largest part of our initial investment is usually in the form of introductory sampling.…Only when satisfied customers have had firsthand experience with the product will the elements of the marketing mix, such as advertising and selling, be fully productive.’
They never enter small categories unless they expect them to grow, and they set out to dominate every category they enter. By building huge volume, they achieve lower manufacturing costs than their competitors, and this gives them higher profit margins, or permits them to sell at a lower price.
They often enter more than one brand in a category, and allow each brand to compete with its sibling – with no holds barred.
They use market research to identify consumer needs. Says Ed Harness, their former Chairman, ‘We are forever trying to see what lies around the corner.…We study the consumer and try to identify new trends in tastes, needs, environment and living habits.’
Most important of all, they have a way of creating products which are superior to their competitors’. And, by blind in-home tests, they make sure that the superiority is apparent to the consumer. Says Harness, ‘The key to successful marketing is superior product performance.…If the consumer does not perceive any real benefits in the brand, then no amount of ingenious advertising and selling can save it.’
When they launch new brands, they advertise them heavily, and they support their successful brands with large budgets – $29,000,000 for Crest, $24,000,000 for High Point, $19,000,000 for Pampers, $17,000,000 for Tide, and so on.
Their test-marketing is unbelievably thorough – and patient. They tested Folger’s regional expansion program for six years before moving into the East. ‘Patience,’ says their President, ‘is one of the virtues of this company.’ They would rather be right than first. Only three products in the history of P&G have gone national without being test-marketed for at least six months. Two of them failed.
My admiration for their advertising principles is boundless, not least because they are the same as my own. They use research to determine the most effective strategy, and never change a successful strategy. Their strategies for Tide, Crest, Zest and Ivory Bar have not changed for thirty years.
They always promise the consumer one important benefit. When they perceive that there is an opportunity to increase sales by promising more than one, they sometimes run two campaigns at the same time – often in the same medium.
They believe that the first duty of advertising is to communicate effectively, not to be original or entertaining, and they measure communication at three stages: before the copy is written, after the commercials are produced, and in test markets. But, unlike me, they do not believe that testing can measure persuasion.
All their commercials include a ‘moment of confirmation’. They show a woman squeezing the Charmin and attesting to its softness. They show a housewife observing that Era gets out grease spots.
In 60 per cent of their commercials they use demonstrations, showing how Bounty absorbs more liquid, how Top Job cleans better than straight ammonia, how Zest leaves no film.
Their commercials talk directly to the consumer, using language and situations that are familiar to her. If the product is for use in the bathroom, they show it in a bathroom, not in a laboratory.
They go to great pains to communicate the brand name, verbally and visually. Most of their names are short and simple. They appear within the first ten seconds of the commercial, and an average of three times thereafter.
Their commercials deliver the promise verbally, and reinforce it with supers. And they usually end with a repetition of the promise. They tend to use a lot of words, sometimes more than a hundred in a 30-second commercial.
When Procter & Gamble uses a continuing character to sell a brand, he or she is always an unknown actor or actress, never a celebrity.
Less than half their commercials include a ‘reason why’. They have come to think it sufficient to show consumers what the product will do for them, without explaining why it does it.
Very often they also show the users of their products deriving some emotional benefit. Like ‘You’ll be more appreciated if you use Dash.’
They use television techniques which have been proved to sell – however much their agencies may regard them as old hat. Notably slices of life, user testimonials and talking heads.
Until 1976, Procter & Gamble eschewed music, but they are now using it, albeit in only 10 per cent of their commercials. And they now use a touch of humor in some of their commercials.
While their commercials are often extremely competitive, they do not spend their money naming competing brands. They refer to ‘the other leading detergent’.
Once they have evolved a campaign that works, they keep it running for a long time, in many cases for ten years or more. But they continually test new executions of the ongoing strategy.
Once they establish an advertising budget, they continually test higher levels of expenditure.
Only 30 per cent of their budgets go into prime evening time. The rest is divided between daytime and fringe. Instead of using 30-second spots exclusively, they have been using an increasing number of 45s, finding that the extra 15 seconds allows for better ‘situation development’ and ‘viewer involvement’.
Almost all P&G brands are advertised throughout the year. They have found that this works better than ‘flighting’ – running them six weeks on, six weeks off. It also provides considerable cost savings.
After competing with P&G in several categories for 30 years, my respect for their acumen knows no bounds. However, they are not infallible. They can be beaten, for all their research and all their testing. Some of their products have failed, including Teel liquid detergent, Drene shampoo, Big Top peanut butter and Certain bathroom tissues.
Their Achilles’ heel is their consistency. They are always predictable. It helps to win battles when you can anticipate the enemy’s strategy.
The best of all ways to beat P&G is, of course, to market a better product. Bell Brand potato chips defeated P&G’s Pringles because they tasted better. And Rave overtook Lilt in less than a year because, not containing ammonia, it is a better product. I cannot refrain from adding that both these giant-killers are advertised by guess who?