P&G seeks "one-on-one" relationship

WARC, 2 December 2011

CINCINNATI: Procter & Gamble, the FMCG giant, is using digital tools to build a "one-on-one" relationship with shoppers, within a wider effort to enhance its marketing and innovation capabilities.

"With digital technology, it's now possible to have a one-on-one relationship with every consumer in the world. The more intimate the relationship, the more indispensable it becomes," Bob McDonald, P&G's CEO, told McKinsey.

"We want to be the company that creates those indispensable relationships with our brands, and digital technology enables this."

One way the firm is exploiting such opportunities is via its "Consumer Pulse" system, which utilises Bayesian analysis of online comments. Comments are grouped by brand and delivered to a relevant individual staff member.

This helps P&G respond to potential issues before they "spin out of control", and plays a key role in marketing. This was as shown by the launch of Downy Unstopables, a laundry scent booster, where the early buzz among web users shaped which messages were employed in communications.

Broader initiatives include letting staff use iPads to download precise, up-to-the-minute insights about the production process, alongside equally rigorous systems covering transport and logistics, and automated retail ordering platforms for retailers.

In emerging markets, the company offers tools for mobile phones showing retailers how they should lay out stores and letting them order goods from P&G through their handsets, a process McDonald described as "leapfrogging" old Western models.

"We're digitising our operations everywhere, from our manufacturing plants to the stores where consumers purchase our products," he added. "We believe digitisation represents a source of competitive advantage."

Innovation has been similarly transformed by data modelling and simulation, while the array of information available also makes it possible to ascertain the views of a representative cross-section of customers almost immediately.

"The advantage for P&G is our scale. We have operations in around 80 countries, our products are sold in almost every country, and we touch more than four billion consumers every day. Imagine all those data points," said McDonald.

"It would be heretical in this company to say that data are more valuable than a brand, but it's the data sources that help create the brand and keep it dynamic."

As an example of how these trends may progress, McDonald suggested QR codes could provide information about a product's ingredients, carbon footprint and other characteristics. "We can't do that today, but it's an aspiration," he said.

Data sourced from McKinsey; additional content by Warc staff

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