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Procter & Gamble Europe: Vizir Launch

2066 words - 9 pages

Procter & Gamble Europe: Vizir Launch

1. Problem:

Whether or not launch Vizir and, if so, whether to launch it to Germany or as a “Eurobrand”

2. Issues

- How to sell counter-culture?

- How to expend liquid detergent of Vizir into a “boil wash” powder detergent washing culture?

- How to standardize its product formulation, packaging, advertising, and promotion if it is going to be a “Eurobrand”?

- How to control the budget and keep the subsidiaries’ profit opportunities?

- How to organize the European operations and coordinate the activities between different subsidies?

- How to not hampering the sales of Ariel and resisting from the competitors to copy?

-How to ...view middle of the document...

The market structure and the competitive environment were also very diverse within Europe and are different from P&G’s accustomed market leadership position in the United States. The washing machine market glowed slowly and raised the competitive pressures.

P&G European sales represented a whopping 15% of their total sales worldwide. Germany and UK were the largest European markets representing 20% each, with France and Italy closely following (30%) and Belgium, Holland, Spain, Austria and Switzerland contributing to the remainder of the market share (20%). Competitors increasingly imitated P&G’s new and innovative products and marketing strategies, and developed them in national markets while P&G’s subsidiaries are constrained by the budget to develop the new-product category or market segment continuously.

4. COMPETITORS ANALYSIS

In Europe, Unilever and Henkel had similar market share with P&G, which was between 20% and 25% of the European laundry detergent market and they are all universal brands. Colgate had a 10% share as a second tire and some national competitors at a third level. However, the market share is various from one country to another. Henkel was strongest in Germany, Unilever was dominating in Holland and the United Kingdom and Colgate had a powerful position in France. P&G was the second in the German market. National companies were strong at the lower-priced level at the local markets.

With the slow market growth, the market was very competitive. Unilever was becoming aggressive and Colgate was very impulsive to launch products with minimal testing.

In German detergent market, P&G is number two brands; Henke’s Persil was a number one with a 17% share. However, in the low-temperature brand, P&G’s Ariel is a leader in the market with 11% market share. Henkel’s Mustang and Lever’s Omo was the second with only 2% market share.

Vizir had been in development and testing for seven years. Initial test-market of Vizir was encouraging but Henkel was also preparing the important new product and would counterattack to protect its dominant position. That means of Vizir will not be launched soon, there will be a competitor’s similar brand be launched and dominate the market first. In this case, the effect that Vizir will have to Ariel is not the most important problem, which P&G should be considered.

5. CONSUMER ANALYSIS

European detergent consumers have a slower life styles compare with American consumers. They do the laundry with a longer time cycle (around 90-minute cycle) and prefer wash things in higher temperatures. In general, “boil wash” is the standard of washing cleanliness. Spain and Italy still had large hand wash segments; top-loading washers were still important in the countries such as United Kingdom and Belgium; the natural-fiber clothing still predominated in Southern Europe. Over 80% of the households still used the boil wash for some loads in Germany. They wear cottons more,...

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