Case Survey


Procter & Gamble Italy: The Pringles Kick off

Group N°1

Jorge Quiñonez

Alonso Díaz

Otto Schroeder

Jaime Rodriguez

1 . A short introduction of the situation offered in the case

Procter and Bet (P& G) was founded in 1837 in Cincinnati, Kentkucky, USA. The innovative technique & intimate understanding of buyer needs, made this small family-run to become among the world´s most important consumer products businesses. In 1980 became a truly global company purchasing news firms and increasing its presence internationally. Around 1999 more than 300 brands in 140 countries generating total product sales more than 35 billion dollars and provide jobs to one hundred ten, 000 employees, investing two billion us dollars (4. 5% of total sales) to research and creation. The company is a leader in various market industries which significant capabilities was its capability to link multiple technologies in order to create impressive, highly original products. P& G serves approximately some. 4 billion people around the globe with its brands. The company offers one of the most powerful portfolios of trusted, top quality, leadership brands (see data 1).

Graph 1 – P& G Brands

P& G initiated business in Europe in 1924 with all the acquisition of Thomas Hedley in the uk. In 1957 when American snack marketplace promised a fantastic growth potential, born Pringles. After 13 years P& G finally created a successful product. It happened in 1999 the Euro market was 30% of P& G´s total product sales, with more 28, 000 employees, 35 manufacturers and summer technical exploration and preparing centers and 100 brands in 23 countries. In Italy, P& G´s utilized 2, 500 people and it's headquarter is located in Rome with fourth factories and two research centers. In 1998 the brand name manager of Pringles in P& G Italy, Emanuele Carando, believed in the tips that the group had developed but is important to apply the strategy of GBU means a major change in direction. Till the competitive challenges from the global industry dynamics in 2000, P& G designed a revolutionary business – restructuring project known as " Firm 2005” the aim was " Stretch, Rate, and Innovation”. The new job divide P& G in four key organizational units (see graph and or chart 2). Furthermore, seven Global Business Units (GBU) were proven based on item categories and were responsible for strategy classification and new product development. Graph 2 – P& G Organization

installment payments on your A description in the problem

In 1990's P& G top management choose to expand into Western European countries after achieving success in the American market and due to the decision to rejuvenate the food sector by taking advantage to the good presence of P& G products. Great britain was picked due to its likeness to the UNITED STATES market. Ahead of entering into the marketplace, tests were done in Ireland without advertising activities. The results motivate to continue so when enter England they achieve a significant discuss. After the British experience, that they target for Germany carrying out tests in Austria which will results executes similar to England. Finally, P& G plan was to grow to Southern Europe, exactly where patters were different. That they decide to enter Spain and Greece and tests had been carried out in Portugal. Benefits also had been encouraging, thus they concentrate on to enter the Italian market.

Chart a few – Pringles Market Share in Europe

The Italian market was seen as a a lower amount of penetration of salty snacks than in different Europe countries. Furthermore, Frito Lay – an American colossus, part of the Pepsi Group- was already in some the countries, although not in Italia. This comparable undervelopment in the salty appetizers category derived from a series of factors: * Good consumer inclination for sweet sancks

5. The belief that salty snacks were unhealthy

2. Salty snacks consumption targeted around the sjus and parties * Tiny attention paid out by...