P&G’s Design Initiative Reaping Results

pgcom_logo_top

One of the traits of a good dividend paying company it is continuously evolving over time. What keeps such companies successful is their ability to recognize the changes in market place and adapting to the new needs. Last week, I highlighted Sysco’s initiative to adapt to changing market place. Today I am moving over to Proctor and Gamble’s industrial design initiatives that has enabled it to continuously increase its market footprint.


P&G has more than 200 plus brands of which approximately 30 bands rake in about billion dollar revenue every year. P&G sells shampoos, toothpaste, toothbrush, shaving razors, diapers, soaps and detergents, tissue papers, etc. The actual products itself are mature and does not have any path breaking innovation (e.g. Shampoo, what will be the path breaking innovation? at the most tweaks?). The challenge for P&G is not about selling these products to consumers. Instead, it is about how to grow continuously, it is about how to maintain the sustainability of its income, and it is about making consumers to pay same (or more) year after year.

One may ask all these are daily consumable products and hence, what has industrial design to do with it. In P&G’s case, industrial design has to do with innovative way to packaging the products. Innovative way to design the package such that:

  • it stands out on the shelf;
  • it gives a different kind of user experience; and
  • it gives a feel of luxurious brand at affordable cost.

P&G recognized this in early 2000 and made organizational change to incorporate design innovation and strategy. It now employs close 300 industrial designer whose only job is to come up with innovative ways to deliver the product to the consumers. Some notable examples are:

  • Herbal Essences brand, the re-design and restaging of this brand and product packaging resulted in new logo, new bottle colors, and design shaped to combine shampoo and conditioner together. Consumers are buying them together now as a system. The net result is revenue coming back and growing.
  • Febreze Air Freshener, significant increase in sales
  • Downy Simple Pleasures, significant increase in sales
  • Crest Vivid White toothpaste, three times increase in sales volume (relative to projection).
  • Oral B toothbrush, new designs and fluorescent coloring makes them attractive in aisles
  • Olay Regenerist, the change in packaging combined with ease of selecting specific one and personalizing the selection process, its now has highest market share in its product group.

Innovation does not only mean high tech electronics gadgets or gizmos and software’s. Innovation is a mindset which can be applied to any domain. Among other, innovation can also used in simple product packaging and branding too.


It is no wonder that P&G continues to grow its bottom line, and continues to be a good dividend company. One thing I would like to understand here is how P&G quantifies the impact of its design changes. I could not find this in any published articles or company presentations. If you know, then please share it by leaving in comments section below.


2 Responses to “P&G’s Design Initiative Reaping Results”

  1. Manshu says:

    I was curious to know if they were doing any sort of brand rationalization or anything like that in this recession?

    Manshu’s last blog post..List of Gold ETFs

    • Dividend Tree says:

      Manshu,

      The design initiative has its roots in 1999 and PG became active on this program in 2000/2001 time frame. It’s brain child of current CEO and has been supporting it since he came on board. So it does not appear to be driven by “this recession”.

      Thanks for stopping by!

      Best Wishes,

Leave Your Comments




Personal Blogs - BlogCatalog Blog Directory ~