Even some of the best known brands in the consumer goods market achieve relatively low penetration. For example, Swiffer products have been available for more than a decade, and they earn $1 billion in annual revenue, and yet only about 10 percent of the U.S. population has tried them. Noting such trends, Procter & Gamble (P&G), which owns Swiffer and a vast number of other familiar brand names, has initiated a new tactic it calls “point of market entry” (POME) marketing.

The idea is that if it can get consumers to sample its products once, it is better positioned to sell them consistently. Following this notion, P&G has decided to devote a far more substantial portion of its marketing budget to sampling and product giveaways, rather than traditional advertising methods. For example, it provides Pampers diapers to new parents at the hospital, and it is committed to sending a Fusion ProGlide Razor to every U.S. male consumer on or around his 18th birthday.

Even in its traditional advertising, it is leveraging this POME concept, such as with ads for Swiffer that show families experiencing the products after a box full of sweepers, dusters, and mops arrives at their doorsteps. Such communications further reflect P&G’s revised advertising approach, in which it seeks to issue fewer but more effective advertisements. As summarized by the company’s global brand officer, “With the overwhelming amount of information clutter in the world, we’re finding that fewer advertising messages, communicated more consistently and with fewer changes, are more effective at delivering top-of-mind awareness.”

Along with reducing the number of ads it runs, P&G has minimized its marketing staff by approximately one-third. It consolidated its internal market research, design, marketing, and communications functions and established a single brand group. Brand managers focus only on its top 80 or so brands, and the company actively has sought to reduce redundancies in its marketing staff lines.

As if these changes were not enough, P&G also wants to reinvent the language used to talk about its marketing efforts. In addition to POME, the company relies on novel terminology such as “trade across,” which occurs when a current customer of one P&G brand also tries another P&G brand in a different product line; “trade in,” or when the company convinces a customer tries a P&G brand for the first time; and “trade up,” when a current customer of a value-based brand switches to a more expensive brand in the portfolio.

Discussion Question:

What are the opportunities and risks associated with Proctor & Gamble’s revised marketing strategy?

 

SOURCE: Jack Neff, “World’s Biggest Advertiser P&G Shifts Focus to Sampling,” Advertising Age, November 13, 2014, http://adage.com