P&G takes nuanced approach in Asia

25 May 2010

SINGAPORE: Procter & Gamble, the FMCG giant, is taking a nuanced approach in Asia as it seeks to drive up sales of both its global and local brands.

"It goes without saying Asia is going to be an area of huge growth potential for all manufacturers," Deborah Henretta, P&G's group president for the region, said.

"For any company that wants to be operating on a global level, they're going to have to be in Asia."

The fact India and China are leading the world out of the recession has added to the importance of firms creating a strong presence, covering everything from manufacturing to marketing, she continued.

This strategy applies not only to these two Asian powerhouses, but also to Brazil and Russia, which are similarly set up to experience rapid economic expansion in the foreseeable future.

"Most companies know those are the emerging markets ... where huge growth and consumer potential is," said Henretta.

In an effort to leverage the opportunities available in Asia, P&G has previously outlined its intention to roll out extensions to several of major brands, such as Olay and Gillette, across the region.

"We'll test potential developed-market brands in developing markets and developing-market brands in developed markets," said Henretta.

Localised innovation will also play an integral role going forward, following on from the success of ranges such as SK-II, the premium cosmetics line which was first introduced in Japan.

Procter & Gamble has also adapted some of its products to fit the particular requirements of individual markets, like modifying the design of Pampers to suit the warmer temperatures which are typical in India.

Overall, however, the company is primarily focusing on brands which are attractive to demographics with similar characteristics, irrespective of where they live.

"We want to build brands that will cross cultures, cross country borders. So we want to be able to take our big brands – and we're being successful taking our big brands – global," Henretta said.

"Almost 95% of the world's population exists outside the borders of the US. If you want to compete on a global basis, you have to appeal to global consumers."

While Procter & Gamble will be employing certain best practices from the US and Western Europe in Asia, Henretta suggested this alone will not be sufficient.

"The race will be on for who will get to the best business models, who can find the best balance of products between the developed world and the emerging markets," she stated.

Data sourced from Roc Now; additional content by Warc staff