At 180 years old, should Procter & Gamble sell itself while it can still fetch a good price?

P&G in the Storm

It may be inappropriate to describe P&G this way, after all, in the 2017 Fortune 500, P&G still ranked 96th, although down 13 places from the previous year, but it should not be said to be in the storm.

But the fact is, P&G has been in the storm all year. First, it was revealed that six shampoos contained carcinogenic dioxane, and netizens found that P&G used different standards in China and Europe.

Recently, it was also revealed that activist investor Nelson Peltz wanted to gain a seat on the company's board. It is said that Nelson brought a basket of plans to change P&G, the most direct being to break up P&G.

Although yesterday's result was that Nelson was shut out, Nelson vowed to come back, after all, the vote was very close. That is to say, the current shareholders of P&G are "too upset" by the company's declining performance year after year.

In recent years, P&G has changed CEOs frequently to revive performance, even bringing back retired executives, but still failed to reverse the sinking of this giant ship.

After changing several chefs and still failing to solve the consumer taste problem, P&G changed its approach and went on a diet, selling off all divisions with sales below $1 billion. France's Coty Group became P&G's buyer.

While P&G was selling, its old rival Unilever was constantly buying.

P&G always believed that its brands declined because new-generation consumers didn't want to use the brands their parents used. But Unilever's Clear has a history of about 10 years, always waiting to take over Head & Shoulders' position.

Yes, Clear's 10-year history cannot compare with Head & Shoulders, which was founded in 1963 and entered the mainland in 1991, but has P&G ever thought about why it has come to this point? Doesn't it have a clue?

When external products are being updated, what is P&G doing? It just thinks about adding some chemical elements and calling it a new product. Your new products are too simple.

The so-called "mom's brand" is just a placebo P&G gives itself...

Is It a Product or People Problem?

Some say P&G's product policy is to compete with itself, ensuring that no matter how the competition goes, the market ends up in its own hands.

But the fact is, when Trout positioned P&G, it gave clear positioning to each P&G product. Taking shampoo as an example, Head & Shoulders for dandruff, Rejoice for smoothness, Pantene for repair, and VS Sassoon for post-color care. It can be said that P&G really paid attention to every detail. Every hair need you can think of, P&G has covered.

But P&G's consumer education is all through scare tactics. Problems like split ends, yellowing, and a series of other issues can all be solved with P&G shampoo. It feels like P&G is selling not shampoo but a panacea, like an all-capable Putian hospital.

But such scaremongering works for a year or two, but in the long run, consumers have their own feelings. If your magical effects don't work, what will consumers think? Especially when beauty-line shampoos began to spread, and professional hairdressers' explanations and the use of beauty-line shampoos exposed P&G's marketing.

In fact, over the years, P&G has promoted toothpaste, personal care products, etc., as if they were panaceas, but consumer education has been minimal. So-called education means at least telling consumers the correct way to brush teeth and the correct way to protect; for segmented shampoos, telling consumers how to use them to get normal results.

As for cosmetics, it's the same. Remember P&G's decade-long spokesperson? Danielle Graham, known as the Olay sister. In 2012, she again became the Olay spokesperson, with an ad called "Hold 25," but the effect was that consumers generally didn't buy it.

Are these product problems or personnel problems? Definitely personnel problems. Because products are just a basic manifestation of a company's personnel changes, and this manifestation has a serious lag. When Xiong Qingyun left P&G, she said P&G lacks innovation and doesn't trust managers' intuition and imagination.

In my view, there's nothing wrong with that, because you don't know if managers are reliable. In the FMCG industry, it's said that P&G managers visiting the market is a favor to the local market.

Only when you perform well, are due for promotion, and have a good relationship with your leader, are you qualified to invite the leader to visit your market. With such visits, how can you expect managers to have intuition and imagination? What problems can they see? It's just a harmonious society.

And P&G's data research, although bought at a high price, is also ridiculous, cold, and arrogant. When you can't control consumers' IDs, no matter how beautiful your logical data capabilities are, you can't know consumers' inner thoughts.

More often, managers have ideas, and then they use data to prove their ideas. It's completely putting the cart before the horse. How can such a P&G fight with new brands?

And obviously, P&G, this 180-year-old dynasty, cannot change itself. A doctor cannot heal himself. In Japan's hundreds of years of history, there was only one Meiji Restoration; the rest were decorations. In China, dynasties that lasted more than 180 years were only Han, Tang, Song, Ming, and Qing. (Xia, Shang, and Zhou had no emperor concept, so not discussed.)

And after entering 180 years, these dynasties were also corrupt beyond recognition. Almost the remaining time was just dragging on.

Such a company trying to save itself is basically impossible; it can only truly change dynasties by selling itself.

Think about Huiyuan, which didn't sell back then. Everyone knows how it is now; Pepsi and Coca-Cola are also in the Chinese market, selling their bodies, only responsible for the soul of the product.

It can be said that today's P&G should take advantage of its remaining value and the chance to be rescued, introduce some activists, or sell itself. That's not impossible.

Indifference to China

We are Chinese, and talking about foreign things without data support is not good. Let's talk about P&G's arrogance and indifference to China.

In 2006, the national entry-exit inspection and quarantine agency announced that prohibited substances chromium and neodymium were found in SK-II brand cosmetics manufactured by Procter & Gamble's Max Factor in Japan. To this end, the General Administration of Quality Supervision, Inspection and Quarantine issued a notice requiring local inspection and quarantine agencies to strengthen inspection and quarantine of cosmetics imported from Japan.

Consumers demanded refunds, and P&G listed four harsh conditions:

First, consumers must provide medical proof that using the product caused skin allergies;

Second, the original valid shopping receipt;

Third, the remaining product must be more than 1/3;

Fourth, for those who insist on returning, the company will handle it specially according to the specific situation, but the processing time must be at least 10 days.

Now SK-II appears again as "Facial Treatment Essence," as if none of this happened, and she is still that proud fairy.

In 2017, the dioxane carcinogen incident involved 6 products, which were exposed to have different standards from EU countries. And back then, Bawang fell from glory because of this incident.

Similarly, P&G's strategy in China is not acquisition but low pricing. For example, when domestic shampoos were highly developed, P&G launched 9.9 yuan Head & Shoulders. After a price war that hurt itself, and Chinese shampoo companies all exited, P&G raised the price of Head & Shoulders to 69 yuan.

Back then, Chinese herbal toothpaste was a very marketable product. Crest launched herbal toothpaste, and among all toothpastes, herbal toothpaste was the cheapest, another case of hurting itself to hurt others. Another batch of excellent toothpaste companies fell.

Fortunately, products like Yunnan Baiyao toothpaste broke the blockade. It's just a pity for Bawang shampoo, which was another product that could have broken P&G's blockade, but ended up dying of depression.

Such a P&G, I don't like...

Source: Kuaixiao Touban (ID: nalanzt)

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