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P&G Part Two

P&g productsI haven't blogged for a while because I've been working on a project that has totally occupied my time. (More on that in due time.)

But a piece in today's Wall Street Journal about P&G prompted some rethinking of my second-to-last book, Secrets of the Marketing Masters.

I spent some time discussing P&G's marketing strategies in that book. Generally, I thought they were masterful. But since the book came out, the company installed a new CEO and the chief marketing officer left. It was hard to tell whether the steep decline in market share and stock price that followed was the product of those changes or of the Great Recession.

Well, now we may find out. The old CEO is back and one of his first big moves will apparently be reorganizing the company into four groups. The Journal thinks that will help identify and test his possible successor. That may be.

But it will also give us some insight into his business strategy. Here's what I mean. 

P&G markets a very broad product line, from diapers to laundry and personal grooming. The Journal suggests the company will group those products by common ingredients. "Paper-based products like Bounty paper towels, Charmin toilet paper, Pampers diapers and Always feminine care products are likely to end up in one sector," it writes.

If the company thinks its major problem is on the manufacturing end, that might make sense.  After all, Pampers and Tampax both start as trees.

But if the company realizes that the root of its problem is in understanding and serving consumers, it will take a very different approach.

Pampers and Luv diapers ($11 billion businesses) will stand on their own with the goal of figuring out how to better serve babies and their parents.  Feminine beauty products like Clairol, Puffs, and Cover Girl will be in a separate group with similar goals. Same thing for masculine grooming. Etc.

That may end up creating more than four groups, but it will focus the company on what really matters -- staying in touch with customers and their changing needs.

That's the biggest secret of the marketing masters. And the company that taught it to us is P&G itself.



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