Market analysis of the Procter and Gamble company

Market analysis of the Procter and bump participationProcter try is a major U.S. manufacturer of soaps, cleansers, and other household crops. PG have three main product lines household and personal care, regimen consumer and health care products. PG interact with over five billion consumers each yr in approximately sixty countries around the world (PG. 2010). PG has proceeded on the Fortune 500 listing since 1955 and has never bedded less than number 35 in the last fifty-five years (AGG Data. 2010). In 2009, it ranked number 20 of Fortune 500 companies with revenue of $83.503.00 million and profit of $12,075.00 million (AGG Data. 2010). According to Mr. John E. Pepper, CEO Procter chance, the phoner has a history of growth and expansion. Every ten years for the last fifty years, the come with has doubled their business organization. He feels the companys succeeder has been based on their brands, including those that created a whole youthful category. For example Pam pers was the premier(prenominal) afford fitted disposable diaper and Crest was the first fluoride toothpaste both manufactured by Procter Gamble (Pepper. 1999). No company in the world has invested more money in consumer and market research than Procter Gamble. Each year the company conducts at least fifteen thousand research studies and invests three-hundred and fifty million dollars in consumer research (PG. 2010). In order for the company to maintain remunerative and grow, they moldiness engage in strategic victimisation that encompasses relooking at their processes, bodily structures and culture and creating the hub and spoke structure for matched intelligence operations.Company BackgroundProcter Gamble was create in 1837 when brother-in-laws James Gamble, a soap maker and William Procter, a candle maker joined forces. The firms starting capital was $7,192.24 and they agreed on a 50/50 distribution partnership (American Chemical Society. 2007). Formation of the company coincided with the economic expansion of the United States. Their first products, soap and candles, were transported by steamboats down the Ohio River to Mississippi and newborn Orleans. By 1850, the company was able to expand their distribution to additional markets using railroads. The company grew into a million-dollar enterprise during the Civil War when the firm obtained contracts to supply the meat Army with soap and candles. However, in 1879 the company was forced to eliminate its candle making when consumers switched to kerosene. The company expanded its soap making to stay competitive by experimenting with developing a castile-like product that was inexpensive enough to be mass marketed. Ivory Soap was the answer. The soap was made from coconut and palm oil, lathered easily, remained solid and lasted durable than other soaps. The company aggressively marketed the new product and the success of Ivory led Procter Gamble to universe a multi-million dollar industrial icon. In the 1930 and 40s, the company utilized technology and chemical experimentation to expand its product line into synthetic detergents that were marketed globally. The company introduced Dreft and then Tide. Now it was no longer consider well(p) a soap company. The company later began to make personal-care items much(prenominal) as toothpaste, shampoo, and deodorant food products such as cake mixes and coffee and miscellaneous products such as cellulose pulp and chemicals.Mission Statement Vision StatementVisionBe, and be recognized as, the best consumer products and services in the worldMissionProcter and Gamble will have-to doe with to serve consumers by continuously innovating products that will allow us to be leaders in household and personal care, health care, and food products. To produce products with the utmost care to give nothing but quality to our communities. And to continue to grow so that we can maximize our shareholders wealth (Procter Gamble. 2010).Procter Gam ble was construct on the theory of touching consumer lives with brands that make life a little better every day. They connect with consumers by offering affordable products and packaging specially designed to meet consumer needs which has allowed Procter Gamble to remain profitable for one hundred-seventy three years.Internal Analysis External AnalysisProcter Gamble has a toilsome internal and external foundation. It has built its reputation on achieving the goals it sets forth, following their vision and establishing principles based on their beliefs about business and consumers. The company has remained a front opponent in innovation by introducing new and improved products to consumers brought on by market changes. PG realizes that in a competitive market speed of research and knowledge is a key element. Mr. Michael Allan, Director of Baby-Care stated to Mr. Pepper, CEO, It wont be the big that eat the small it will be the fast that eat the slow (Pepper. 1999). Procter G amble realized that the company needed to refocus their attention to continue to achieve a winning system to meet internal and external challenges. Leadership felt that their growth was to slow and their complexity was too high. Their objective became to build and create leadership brands globally better than ever before and to capitalize on the knowledge, grapplency and commitment of its employees. This will be achieved by simplification of the organization structure, minimizing processes, introducing technology and making strategic changes to their culture.SWOT analysis of your plans focus area(s)StrengthsProfitableAdaptability of Product phone line to meet consumer needs.One of Procter Gambles strengths is it remain profitable in a struggling economy. It produces products that are personal care items that are necessities even in hard times. Procter Gamble 2009 annual report to investors shows it employed 102,000 employees in 80 countries and reported net sales $79,029 mill ion (PG. 2009). The Board of Directors proposed a dividend of $1.64 per share for 2009 (PG. 2009). Since the corporation is profitable, they are able to invest these profits into acquiring additional companies that will add new products and services to its portfolio to focus on consumers needs.WeaknessTurnaround time for Research and culture products.Complexity of organization structureCurrently research products take three to four years to develop and market. Given the consumer demands and competition this is too long and the company sales declined in 2009 compared to 2008. PG organizational structure is multi-tiered for each product line. Changing environment necessitates scale down of management positions and develop the hub and spoke structure for competitive intelligence operations.OpportunitiesGlobal marketingNew Products, improvement in existing products, manufacturing and marketing techniques.Procter Gamble has the opportunity to market products in emerging technologies. B y localization themselves in the development of new products and improvements to existing products they are at the forefront of technology development with vast opportunities for growth. This has the potential to lead to an increase in customers and rising profits. PG also has the opportunity to market their products in other international areas. Currently PG products are sold in 180 countries (PG. 2009). The corporate structure provides the framework to pick apart the benefits of a global organization with speed and efficiency.ThreatsEcological FactorsEconomic FactorsSales are dependent on consumer spending. When the economy is weak and consumers reduce spending, PG feels the impact. They must remain competitive with damages and offer diversification of their market line so they can maintain a financial balance. PG operations must remain compliant with political regulations concerning recycling and bio-degradable materials and other mandated ecological factors to preserve the environment.Goals (3-5 years)Eliminate the overlap in managementInitiate the hub spoke structure for competitive intelligence operations prolong sales of product line globallyInternational expansion to markets with potential for growth and limited competition exitsDecrease turnaround time for research and development productsCustomer responsivenessProduct development cyclesProduct or service improvementsSpeed in delivery or distributionDevelop open purpose StrategyEmphasis on process innovation that permits low-cost product design, manufacturing methods and distributionProduct cost reductionLong Term ObjectivesSupport the business strategy, organizational principles and culture.Attract and retain required talentAccept financial responsibility to shareholdersThe goal of long limit objectives is to support the business strategy as change is employ. The strategy should be the reference point and link to the design and mechanics of implementation. Linking plan design to the business strategy generates employee motivation and buy- in to the changes being implemented which establishes the culture of the work environment. Attract and retain required talent ensures profitability and endurance. Position PG to be the employer of choice by offering attractive, competitive traffic opportunities for long-term financial security across many global locations. Build a personnel structure that allows mobility as changes to organizational structure are deemed necessary. go on profitable and supportive to shareholders by declaring yearly dividend on stock holdings.Strategy Analysis and ChoiceGeneric Strategy DifferentiationA long term strategy must be based on a core idea or generic strategy that gives directionto the company to strategically compete in the consumer marketplace.Differentiation for Procter Gamble involves creating unique products and marketing them to consumers by stressing their products qualities are superior to its competitors. This strategy defines loya l customers who will pay a premium price for their brand because they truly believe in the product. Marketing should be aimed at the qualities that set the product apart and above its competition.Grand Strategy Concentric variegationGrand strategies are the basis of coordinating and sustaining efforts toward achieving long-term business objectives by providing basic direction for strategic actions. Concentric diversification is a key epic strategy for Procter Gamble. It involves acquiring businesses that are compatible with PG in terms of technology, markets and products. According to Pearce Robinson, The ideal concentric diversification occurs when the combined company profits increase the strengths and opportunities and fall the weakness and expose to risk (Pearce Robinson. 2010. P. 221).Plan Goals and ImplementationProcter Gamble should continue to monitor trends in the market and consumer requests for products and implement a corporate retrenchment strategy to enable them to expand their product line and to make their product available to other international locations based on market research. This can be implemented by PG conducting a stakeholder management survey. By hiring a global marketing education firm to conduct a stakeholder management survey, the information can be used to identify, prioritize and develop improvement initiatives in areas that needed improvement as identified by consumers. The survey would also provide geographical information on profitable areas to introduce PG products. An increase in research and technology operating budget will allow emerging technologies to continue to be genuine and products readily available to consumers. According to Information Week, Procter Gamble management structure is reorganizing the companys current corporate structure is four geographic business units. The new structure will now be seven global business units based on product categories which is call the product team structure. The company is highly energized and mournful forward with increased spending in Information technology (InformationWeek. 1999).Critical Success FactorsCritical success factors are the steps that the business, both management and employees, must take to bring the strategies into a reality. The factors may vary from time to time, but they must be addressed in order for the company to operate at optimal efficiency. . A critical factor for Procter Gamble is quality and innovation. The company must aggressively market new products and bring research technologies to customers quicker. Critical success factors are beneficial to companies as they provide focus and keep the employees and management going in the same direction. Another critical success factor is increase revenues. A company must be profitable to be successful. Another factor is expansion of customer service. PG must be reachable when consumers have a question.Controls and EvaluationControls must be in place to evaluation success. Fina ncial statements will validate if sales are increasing and profits are increasing. foretelling is a vital control. A monthly and yearly projection should be made by management to project the sales of products by area. The evaluation would be done monthly to compare the plan to the actual units sold. This information will provide PG with marketing information for inventory qualities, product turnover and stagnant product lines.ConclusionTodays market is characterized by highly competitive organizations which are all vying for consumers loyalty. Firms are faced with the challenge to maintain their own competitive edge to be able to survive and be successful. Procter Gamble was built on the theory of touching consumer lives with brands that make life a little better every day. They continue to connect with consumers by offering affordable products and packaging specially designed to meet consumer needs. Procter and Gamble must maintain an innovative approach by introducing new produc ts and re-facing existing product lines to compete and satisfy consumer demands, to allow them to remain profitable for the next one hundred-seventy three years.