Brands can compete, says P&G's Donnelly

10 June 2009

LONDON: Brands are still able to compete with own label products in the FMCG sector, but listening to consumers to understand their changing needs and values in the downturn will by key, according to Roisin Donnelly, Procter & Gamble's corporate marketing director, UK and Ireland.

Many brands attempt to either introduce heavy price promotions or decrease their adspend during periods of financial instability, but thse approaches can prove problematic both before and after the economy has started to recover.

Speaking at an event organised in London by Marketing magazine and Yahoo, Donnelly argued that "most of the categories we operate in are flat as a pancake. There is no change to the nappies you use in a recession, for example."

However, while many of P&G's properties are coming under increasing pressure, Donnelly posited that own-label products "are only succeeding where there are not strong brands."

By contrast, "where there are strong brands that offer superior performance, people are putting their trust in them" rather than looking to private label equivalents.

She also emphasised the continuing importance of "talking" to shoppers, as in order to keep up with how a consumer's views are evolving, brand owners have to "listen to her and see how she is changing."

Procter & Gamble is also looking to redefine the nature of "value", which does not necessarily require competing with heavy discounters, an approach that can risk undermining brand-building efforts. 

Rather, Donnelly said, "value is not just about price, it is about performance," meaning there are other strategies that can be pursued to bolster a company's position during the recession.

These include focusing on innovation, as it is "incredibly important in FMCG that you bring engaging products to the market."

Indeed, Donnelly said that P&G is "innovating more than ever," such as with a new variant of Ariel, its fabric care and cleaning brand, which allows consumers to wash clothes at low temperatures.

Overall, she argued it is typically the case that "brands that invest in a recession grow; the brands that don't, decline."

Another area where P&G is placing a heightened emphasis is on digital media, but Donnelly argued against trying to separate out the role and impact of different mediums.

"We don't brief on ads, we brief a communication idea," she said, although she did add that "I haven't seen a model yet that works in Twitter."

Data sourced from Brand Republic; additional content by WARC staff