Procter & Gamble targets online growth

21 May 2010

CINCINNATI: Procter & Gamble, the FMCG giant, is strengthening its online presence as it seeks to drive up web revenues.

The company launched a pilot version of its new eStore, which was developed in conjunction with PFSWeb, among 5,000 web users in the US earlier this year.

It has now officially unveiled this platform, which will host "brand shops" for leading products like CoverGirl, Crest, Olay, Tide and Pampers.

Visitors can modify this portal to suit their individual needs, as well as being able to contribute to a forum about the goods they have bought and "rate and review" their purchases.

Further features include "live chat product consultants", who will advise any netizens requesting help to ensure that customers "feel confident in their purchase decisions".

The eStore will also be linked to a variety of social media properties, meaning that the followers of P&G's brands can acquire them directly from dedicated sections on sites like Facebook.

At present, Procter & Gamble is offering members of Facebook the chance to save money when they buy "bundles" of items from its Pantene range, which has 300,000 fans on the social network.

P&G currently derives 1% of its $79bn revenues (€62.2bn; £53.3bn) from the web, and the company said its eStore will serve as a "living learning lab" allowing it to "listen, learn and collaborate with online shoppers."

"We envision the eStore will help deliver new tools, services and features that can ultimately be shared with retailers to provide a real convenience and value for shoppers," Kirk Perry, P&G's vp, North America, argued.

"[It will] also delivering innovation for the industry and specifically for our product categories."

However, Bob McDonald, Procter & Gamble's chief executive, was rather more bullish when speaking in an interview with the Financial Times, the daily business title, last year.

"I don't feel the need to have every sale go through a retailer. We want to maximise our sales through retailers but we also want to be where the consumer wants to shop," he said.

Procter & Gamble's heightened emphasis on e-commerce moves it into competition with chains such as Wal-Mart, Target and Walgreens, and internet specialists like Amazon.

A mobile app will also be introduced for P&G's eStore in the near future, an avenue that could prove profitable as devices like Apple's iPhone and the BlackBerry increase in popularity.

According to estimates from the Mobile Marketing Association and Luth Research, approximately 20% of the wireless user base in the US bought goods and services via their phone in the last month.

However, based on a survey of 1,000 people, the organisations found only 6% had purchased physical and "non-mobile" objects in this way.

A similar number had received coupons and discounts on their handsets, with participants in the 25–34 year old age group displaying the greatest level of uptake overall.

The Coda Research Consultancy has also predicted that US m-commerce revenues will rise by 65% a year to $24bn (€19.0bn; £16.6bn) by 2015, equivalent to a 7.7% share of all e-commerce sales.

Within this, average individual expenditure will leap from $8.60 to $80, with this total applying to coupons, physical products, apps, video and music downloads as well as games.

Data sourced from Financial Times/MediaPost; additional content by Warc staff