Loading presentation...

Present Remotely

Send the link below via email or IM

Copy

Present to your audience

Start remote presentation

  • Invited audience members will follow you as you navigate and present
  • People invited to a presentation do not need a Prezi account
  • This link expires 10 minutes after you close the presentation
  • A maximum of 30 users can follow your presentation
  • Learn more about this feature in our knowledge base article

Do you really want to delete this prezi?

Neither you, nor the coeditors you shared it with will be able to recover it again.

DeleteCancel

Make your likes visible on Facebook?

Connect your Facebook account to Prezi and let your likes appear on your timeline.
You can change this under Settings & Account at any time.

No, thanks

P&G

No description
by

Pénélope Bertignon

on 16 February 2016

Comments (0)

Please log in to add your comment.

Report abuse

Transcript of P&G

Procter & Gamble's Acquisition of Gillette
OVERSIGHT OF THE CASE
FINANCIAL ANALYSIS
EVALUATION OF P&G'S STRATEGY
EXECUTIVE SUMMARY
Reminder
Objectives
Evaluation
Companies backgrounds
PESTEL, Porter & SWOT
Aftermath
Problem & Challenge identification
P&G'S
COMPETITIVE ADVANTAGE
The competitive advantage
McKinsey + 9-cell matrix
RECOMMENDATIONS
List of recommendations
Decision grid
Implementation plan
Contingency plan
CONCLUSION
1.
Sell off snack and pet care business segments: they are amongst the least profitable ones


2.
Enter new markets: opportunity to innovate in successful markets


3.
Continue to conquer emerging markets: P&G focuses on 10 emerging markets which include China, South Africa, Mexico, Brazil, Nigeria, and Poland
Costs: 0= high | 5= low

Time: 0= a lot | 5= not much

Feasability: 0= not do-able | 5= good
Best alternative: Conquer emerging markets
Cost structure
Production of the new products

Research tools for the studies

Communication and advertising fees

HR costs: more employees might be needed for this project

Possible changes after the launch, adjustments for the next seasons (risk management)
2nd Best alternative: Overcoming P&G’s main competitors
Pros:

China soon being the world’s largest purchaser of beauty products
Overrunning them in the long run can also benefit to the brands’ images to the customers
Future obvious increase in sales
P&G

Headquartered in Ohio – US.
Founded in 1837, by William Procter and James Gamble.
Global Leader:
Consumer Branding
Feminine products
Segments:
Household Care
Health & Baby Care
Family Care
Beauty Care
PESTEL
Porter
SWOT
Problem
Challenge
Operational
Strategic
Upon acquisition, P&G has to successfully integrate the operations of Gillette with its own with minimal unnecessary disruption
Increasing expenses within the R&D sector of the organisation. Increasing debt levels within P&G are also of concern
The threat in the Chinese skincare market, with another company about to overtake as the number one brand
Some markets are undercapitalised and P&G will have to consider operation in those areas e.g. haircare and skincare
As stated earlier on:


P&G’s strategy is to «Be, and be recognized as, the best consumer products and services company in the world».

Gillette’s is «To build a total brand value by innovating to deliver consumer value and customer leadership faster, better and more completely than our competition»
By blending in these two versions, 4 main expectations came out:


To have a stronger business line-up and brand portfolio

To rise significant cost saving opportunities: Cost sharing units + reduction of the workforce

To note faster growing sales

To bring in synergies: operational, financial, and collusive
Structure:

Oversight of the case
:
Companies backgrounds
PESTEL
Porter
Strategic diagnosis
Financial highlights
Problem & Challenge identification

Evaluation of the strategy

P&G's competitive advantage
Is it sustainable?
MacKinsey method & 9-cell matrix

Recommendations and their implementation plan

Brief conclusion


The acquisition owas one of the fifteen largest acquisitions between 2000 and 2010

4 major goals:
Improve its business line-up & brands portfolio
Faster growing sales
Costs sharing
Synergies -> 1+1=3

Acquisition cost: over the usual range, but when we consider the market price just before acquisition, the premium of 20.1% is consistent with similar acquisitions

P&G should keep on entering new emerging markets to gain market shares.

Global exposure
160 countries & Gillette is strong in emerging markets like India and Brazil,

High growth market
P&G aced in women segments marketing, while Gillette’s core customer segment was essentially men.

Bargaining power with retail buyers
The acquisition of Gillette strengthened the influence of P&G on retailers, especially Wal-Mart in the US
Sustainability
People will most certainly always come face to face with one of P&G’s brands’ product

Emerging or developed countries

Brands also range from high end to low cost -> High variety + number of customers

Rapidly growing markets.

Salwa Asban - Zineb Mesraf - Antoine Le Guellec - Cyril Remande - Pénélope Bertignon
What is a strategy?

A strategy is a choice of objectives and means in order to achieve them on a long-term basis taking in consideration the vision of the organization.


P&G's strategy

“Be, and be recognized as, the best consumer products and services company in the world”


Results

One main recommendation stood out:
Continue to conquer emerging markets. Launching new products from existing brands in selected markets may be the answer to overcoming the intense competition.
4.
Focus on overcoming P&G’s main competitors in Household care or Beauty care over the world + in China: Unilever, L’Oréal, and Shiseido
Earnings: 0= low | 5= high

Risk: 0= high | 5= low
Enables innovation and therefore competitivity
Present in almost every place around the world = changes the market segments competition
Improving customer care
Such an important diversification doesn’t let them concentrate on specific products like for instance L’Oréal, who is dedicated to a specific segment.
Gillette

Headquartered in Boston – US.
Founded in 1901, by King Gillette.
World leader:
male grooming products
alkaline batteries
Segments:
Blades and Razors
Duracell
Oral Care
Braun
Strengths

Ownership of large leadership brands
Global Exposure
Weaknesses

Mature market reliance
Innovation

Opportunities

New emerging markets (India & China)
High-growth markets (Hair & Skin care)
Threats

Global and Local competition

Reusable products
Disposable product

Products Brand Wording
Integrated R&D

Strong staple brand

Declining global economy


Same geo-political landscape

Rivalry
+ -
Constant maintenance of products
Buyers
-
Wide variety of products
Substitutes
-
Cheap accessible products
Suppliers
-
Enormous size of P&G

New entrants
-
Over saturated market
Full transcript