"P&G’s Sales Growth Shows Consumers Will Pay More"
"Maker of Tide detergent, Gillette razors gets boost from higher prices"
WSJ Article published April 23, 2019
https://www.wsj.com/articles/procter-gambles-sales-rise-on-higher-pricing-strength-in-beauty-products-11556019857?mod=searchresults&page=1&pos=2
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| https://news.pg.com/press-release/pg-corporate-announcements/pg-details-transformation-delivering-strong-results-shareho |
Analysis by Nancy Rodriguez
According to the Wall Street Journal article, consumers are willing to pay more for brand-name household items by Proctor & Gamble Co., which is the biggest household-item selling company that sells a variety of individual brands. The author of the article states that P&G reported its highest quarterly sales growth in eight years as a result of increased prices which also resulted in its competitors raising their prices. Product prices were increased because of "higher costs of raw material and unfavorable foreign-currency swings." P&G increasingly raised their prices 4%-10% from last September to mostly in February, yet its stock went up 40% just within the past year. The company has also taken advantage of having activist investor Nelson Peltz on its board by following his suggestions. However, the finance chief estimates that next year's logistics costs, currency fluctuations, and tariffs from the conflict between the US and its trading partners will negatively impact the next fiscal year. Additionally, its private and smaller brand competitors have not raised their prices.
This article relates to the marketing concepts by especially focusing on pricing and product. P&G is a great example of what a company with individual brands look like and how there is outside and inside competition as a consequence. Additionally, through its different brands, the company appeals to different types of target audiences. P&G is also a company that is popular based on its brand names. The gradual increase in prices because of increased costs in raw material also indicates they are trying to cover their costs and make a profit. The article also features a good analysis of P&G's competitors such as those who have also raised their prices and those who haven't. The place section from the marketing concept is also a part of this article, because the logistics costs will interfere with the company's finances in the future.
I chose this article, because we recently discussed pricing in class. I think this is a perfect article for the topic. P&G is also a very well-known company, and I have used its products. Further, I am impressed that the company was able to increase its stock and sells despite increasing its prices.
According to the Wall Street Journal article, consumers are willing to pay more for brand-name household items by Proctor & Gamble Co., which is the biggest household-item selling company that sells a variety of individual brands. The author of the article states that P&G reported its highest quarterly sales growth in eight years as a result of increased prices which also resulted in its competitors raising their prices. Product prices were increased because of "higher costs of raw material and unfavorable foreign-currency swings." P&G increasingly raised their prices 4%-10% from last September to mostly in February, yet its stock went up 40% just within the past year. The company has also taken advantage of having activist investor Nelson Peltz on its board by following his suggestions. However, the finance chief estimates that next year's logistics costs, currency fluctuations, and tariffs from the conflict between the US and its trading partners will negatively impact the next fiscal year. Additionally, its private and smaller brand competitors have not raised their prices.
This article relates to the marketing concepts by especially focusing on pricing and product. P&G is a great example of what a company with individual brands look like and how there is outside and inside competition as a consequence. Additionally, through its different brands, the company appeals to different types of target audiences. P&G is also a company that is popular based on its brand names. The gradual increase in prices because of increased costs in raw material also indicates they are trying to cover their costs and make a profit. The article also features a good analysis of P&G's competitors such as those who have also raised their prices and those who haven't. The place section from the marketing concept is also a part of this article, because the logistics costs will interfere with the company's finances in the future.
I chose this article, because we recently discussed pricing in class. I think this is a perfect article for the topic. P&G is also a very well-known company, and I have used its products. Further, I am impressed that the company was able to increase its stock and sells despite increasing its prices.
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