Case Study PG: Teaching An Old Dog New Tricks

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PG: Teaching an Old Dog New Tricks

A summary of a special report on innovation

Background
When Procter & Gamble (P&G) acquired Iams, an exclusive and high-priced pet brand, there was some angst that the acquisition would stem the brand growth and adversely affect the brand loyalty of consumers. Initially only available for purchase at pet stores and veterinarians, P&G immediately increased product availability through retail outlets and thus, increased the distribution by 50% overnight. In addition, P&G conducted research focused on the fears of consumers and subsequently, launched products concentrating on pet health and longevity, such as weight-control pet-food formulas and pet medical insurance for Iams-branded MRI scans. By increasing availability and addressing the needs of consumers, P&G enabled Iams to move from the nation’s …show more content…

Therefore, P&G not only markets the product, but the consumer’s experience as well. By having the designers’ part of the whole process, it is more likely that the final product will appeal more effectively to consumers. For example, the P&G product design team worked on marketing materials and in-store kiosks for SK-11, its priciest product line ever, and assisted in P&G’s entry into the prestigious cosmetics sector.
Cater for developing markets
It should be considered that what appeals in one market, might not necessarily yield the same results in another. P&G initially generated only 20% of its revenues in developing countries, which is much lower than its competitors were. Consequently, P&G established smarter, more cost effective methods to cater for those markets. Firstly, P&G contracted manufacturers to reduce costs in production. Secondly, P&G engaged the consumers in the developing markets to establish their needs and made slight alterations to products to increase appeal. Resultantly sales in emerging markets increased with 19%.
Know what not to

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