Proctar and Gamble
Essay by pbagch • July 20, 2016 • Case Study • 728 Words (3 Pages) • 1,100 Views
PROCTOR & GAMBLE SCOPE
Background and Decision
Scope is green, mint-tasting mouthwash is one of the leading brands of Procter and Gamble Inc.It is the brand which became market leader in Canadian mouthwash market in 1976 and until 1990 it has enjoyed the greatest market share. Plax was introduced in Canada in 1998 on a different platform from the traditional mouthwashes and is the only player in the market segment of plaque fight. Generally, Canadian mouthwash market is growing at an annual rate of five percent, and plaque fighting segment represent 10 % of this market.
Since Scope is not operating in plaque-fighting segment, the problem lies in development of strategy for Procter and Gamble to enter this market segment and to fight Plax.
Industry/Market Analysis
Procter and Gamble is one of the most successful costumer companies in the world with it’s brand in more than 140 countries. They provide branded products of superior quality and value that improve the lives of the world’s customer for now and next generations.Procter and Gamble operates in five operating divisions: Paper products, Food and beverages, Beauty care, Health care and Laundry and cleaning.
Prior to launching of Scope, the leader of the Canadian mouthwash market was Listerine, a germ-killing mouthwash that protects from bad breath. As Scope was introduced, took the leading position soon because beside bad breath protection it offered great taste. However, in 1988 Plax was introduced as “pre-brushing” rinse and it was the first mouthwash to fight plaque. Plax established new segment within mouthwash market, segment of plaque-fighting and gained 10 % of total market.
Buyer Behaviour
According to the data from market research,arounf 75 % of the Canadian Population are using mouthwash brands
Furthermore, market can be segmented according to the frequency of usage:1)“heavy” users (once per day or more) – 40%2)“medium” users (two to six times per week) – 45% 3)“light” users (less then once per week) – 15%.
Most important reasons for usage of mouthwash are :1)It is part of my basic oral hygiene – 40%2)It gets rid of bad breath – 40%3)It kills germs – 30% 4)It makes me feel more confident – 20% 5)To avid offending others – 25%
Competitor Analysis
Listerine | germ-killing mouthwash that eliminates bad breath |
Cepacol | positioning close to Listerine, germ-killing mouthwash |
Listermint | positioned as direct competitor to Scope in terms of good tasting mouthwash that fighting bad breath |
Colgate | it fights cavities and has a mild taste that encourage children to rinse longer and more often |
Plax | removes up to three times more plaque than just brushing alone” |
Alternative 1: Maintain status quo
This will involve incurring no immediate costs and upho;d familiarity in the brand which will not be confusing to the consumers.Maintain business stability for short term.However it may share risk of declined service and sales
Alternative 2: Extend the product line under Scope name
This will cause penetration in a new market segment for long term profitization. However it may cannibalise 2 to 9 percent of existing Scope’s brand.This will also require $ 20,000 for product testing.and further it would also take two years to get 6.5% of total mouthwash market(Exhibit 1 & 2)
Alternative 3: Create a new “flanker” brand to compete with Plax
This will allow it to directly compete against Plax and prevent current users from switching.However it may confuse the current consumers,advertising would be difficult too and success depends on the CDA approval
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