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Maaya Honda Nanaho Tsuchihashi

Discover how P&G has successfully understood the Chinese market and consumer behavior for beauty products. Learn about their business model, SWOT analysis, and future steps.

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Maaya Honda Nanaho Tsuchihashi

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  1. Maaya Honda NanahoTsuchihashi

  2. Contents *P&G over view *Business model *How P&G understand Chinese market and consumers? *Behavior of Chinese consumer for beauty products *P&G in cosmetics market *SWOT analysis *Problem & next step

  3. WHY? P&G over view

  4. P&G overview What is P&G(Procter & Gamble) ??? An American multinational consumer goods company headquartered in downtown Cincinnati, Ohio U.S It was Founded in 1837 by William Procter and James Gamble “Touching lives, improving life”

  5. P&G overview In 2012, P&G recorded $83.68 billion in sales. Fortune magazine awarded P&G a top spot on its list of "Global Top Companies for Leaders“ It ranked the company at fifteenth place of the "World's Most Admired Companies" list Ranked #7 among the Top 50 Companies for Diversity

  6. P&G overview P&G serves about 4.8billion consumers around the world It operations in about 75 countries Its brands are available in more than 180countries

  7. P&G overview Background of P&G worldwide

  8. P&G overview Background of P&G in China WY? Ⅰ Ⅱ Ⅲ Main operating revenue of P&G in China from 1997 to 2003

  9. P&G overview Ⅰ1988~1998 Rapid growth The headquarters is in Guangzhou(合资企业-广州宝洁有限公司) The first product was “Head & Shoulder” • 1989.6 The hiring of new 20 graduates • 10 new product “H&S 2 in 1” was put on sale • 12 starting operation of the factory in huangbu(黄埔)

  10. P&G overview Ⅱ1998~2001 declining P&G was attacked by many multinational and local corporation Because of… ・A fierce competition of each segments ・”high price and high quality” strategy The local corporations took “low price” strategy and focused on farming areas as their main target

  11. P&G overview Ⅲ2001~ Re-prosperous <Localization strategy> ・three institutions of P&G (Guangzhou, Taiwan, Hong Kong) were integrated into one Headquarters, which in Guangzhou ・opening up a new market in farming area ・entry into the price competition ・increase in investments in China In 2002 and 2003, the sales growth ratio was over 25%

  12. P&G overview P&G products It has 23 brands in China

  13. P&G overview *Beauty & Grooming <Hair-care> REJOICE, PANTENE Head & Shoulder, VS Herbal Essences, CLAIROL, WELLA,CAMAY <Skin-care & cosmetics> SK-Ⅱ, OLAY, Oceana <Shavers> Gillette, BRAUN <Personal care> Safeguard

  14. P&G overview *Health & Well Being <feminine care pad> Whisper, naturella <Toothpaste> Crest, Oral-B

  15. P&G overview *Household care <Laundry detergent> Tide, ARIEL <Diaper> Pampers Having No.1 share (45%) in a China’s disposable diaper market <Battery> DURACELI

  16. WHY? Business model

  17. Business model Business model elements... Value proposition Customer segment Chanel Revenue stream Customer relation Key resource Key activity Key partner Cost

  18. Business model Costomer segment ・Mass market ・Housekeeper ・Women who care about beauty ・Men who care about hair and skin ・Mother who has baby ・Person who has pet

  19. Business model Value proposotion ・shift stains ・bring beauty ・keep beauty ・comfort ・keep pets healthy ・high quality ・reliance

  20. Business model Chanel ・super market ・department store ・hair salon ・pet shop ・drug store ・Internet

  21. Business model Customer relation ・seller and buyer ・value proposer and value creator ・prosper community

  22. Business model Revenue stream ・retail price ・innovating technology ・re-use

  23. Business model Key resource ・factory ・distribution center ・retailer ・patent

  24. Business model Key activity ・production ・develop and improve products ・distribution ・marketing ・R&D

  25. Business model Key partner ・battery-powered instrument maker ・hair salon ・distribution center ・factory ・ad agency

  26. Business model cost ・producing ・distribution ・marketing ・ad ・R&D

  27. WHY? How P&G understand Chinese market and consumer

  28. How P&G understand Chinese market and consumer Large population + Rapid economic development Market expansion

  29. How P&G understand Chinese market and consumer Business model Scale of Chinese retail market and growth rate(ratio to the same in the previous year) Tend of cosmetic market Total amount of retail sales trillion yen Growth rate %

  30. How P&G understand Chinese market and consumer Business model Disposable income / person Tend of cosmetic market Japan China thousand yen / year thousand yen / year

  31. How P&G understand Chinese market and consumer Business model Consumption expenditure of urban Chinese Tend of cosmetic market other Education and amusement Communication and transportation Medical care yen Household articles house cloths food

  32. WHY? Behavior of Chinese consumer for beauty products

  33. How P&G understand Chinese market and consumer Business model Disposal income of Chinese woman and growth rate(ratio to the previous year) Tend of cosmetic market Disposal income Growth rate thousand yen/year

  34. Behavior of Chinese consumer for beauty products Do you spend money and time on keeping beauty? YES! other 38.9% absolutly YES ! 18.6%

  35. Behavior of Chinese consumer for beauty products Business model What kind of skin care goods do you use?

  36. Behavior of Chinese consumer for beauty products Business model What kind of skin care goods do you use? 41.8% C 88.5%

  37. Behavior of Chinese consumer for beauty products What kind of make-up goods do you use? C

  38. Behavior of Chinese consumer for beauty products Business model What kind of make-up goods do you use? 64.8% 95.1%

  39. WHY? P&G in cosmetics market

  40. P&G in cosmetics market Cosmetics market trend worldwide In the last 20 years Global Beauty Market has grown by 4.5% a year on average (CAGR), with annual growth rates ranging from around 3% to 5.5%. Since the turn of the century the cosmetic markets of the BRIC countries (Brazil, Russia, India, China) have been growing very fast. The BRIC countries are the main force within the so-called emerging markets. In 2011 all those countries generated 81% of the global cosmetics sales growth, more than half of which (54%) was attributed to BRIC. (The other emerging markets : Mexico, Argentina, Indonesia, Thailand, Turkey)

  41. P&G in cosmetics market Global Cosmetic Market – Ranking by Country (2012, USD B)

  42. P&G in cosmetics market Beauty distribution channels 2000-2010 The market share of the non-store retailing channel is gradually increasing .This channel includes direct sale and sale over the internet.

  43. P&G in cosmetics market Global Beauty Retail Sales by Product Category (1998-2010) In 2010 skincare was the most significant segment. Its growth driven primarily by the Asian market. The global skincare market is divided into facial care (2/3 of the total sales), hand and body care and sun care.

  44. P&G in cosmetics market Retail value of cosmetics by wholesale and retail enterprises above designated size in China: 2008-2012

  45. P&G in cosmetics market Brand positioning image in China’s cosmetics market Brand positioning image in China’s cosmetics market Image Western Japanese Korean, Chinese Image Western Japanese Korean, Chinese Pre-stage (KOSE) (MENARD) Pre-stage (KOSE) (MENARD) High-end High-end Middle-mass Middle-mass Low-end Low-end In 2012 In 2012

  46. P&G in cosmetics market Market Share of the Top 10 Brands of Selected Sectors 2010-2011

  47. P&G in cosmetics market Shampoos, Conditioners and 2-in-1 Conditioning Shampoo: Share of Total Sales Value 2010-2011

  48. P&G in cosmetics market Other Hair Care Products (Colorants, Hair Mask & Styling Agents) Share of Total Sales Value 2010-2011

  49. P&G in cosmetics market Skin Care Products: Share of Total Sales Value 2010-2011

  50. P&G in cosmetics market Color Cosmetics: Share of Total Sales Value 2010-2011

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