Even billion dollar brands were babies once ~ Brand Mix

Thursday, November 29, 2007

Even billion dollar brands were babies once

P&G recently announced that Gain (R) had become the 23rd member of its billion dollar brands club. P&G has been increasingly focusing its resources on fewer of its brands, the ones with more growth and profit potential and either selling off or even shutting down those that are low growth, low margin. It's been an effective strategy and one that has helped P&G deliver good financial results.

But not all innovations and market opportunities fit under these 23 brands or even in the larger number of billion dollar hopefuls in the P&G franchise. What to do about those? All large CPG companies struggle with how to nurture and develop new-to-the-world brands. Until they reach about the $100 million mark they are often too fragile to survive the culture and environment of companies that are set up for much bigger things. The sales force doesn't know what to do with them, retail partners don't either. They can't be marketed using programs the companies typically use. There's a lack of patience and a demand for a positive return that doom many a promising idea.

So, it was interesting to read how P&G's has launched its new brand, Align to the world. This is a probiotic dietary supplement designed to aid the digestive system, an entry into a hot but still relatively new and niche category. Rather than try and push this new product through traditional retailers, P&G has sold it for the last two years via the web or phone. Only now that it has traction, has P&G added the likes of Wal-Mart, Walgreens and CVS to the mix.

It's a great idea especially for products like this that are both shelf stable and have a high price point ($33) where the online economics and logistics work out.

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