P&G CEO Seeks to Add One Billion Customers

Bob McDonald has only been Procter & Gamble’s CEO for a few months, but he’s already got a full plate. Speaking at the company’s annual meeting this week, Mr. McDonald noted that P&G reaches about 4 billion people now, but is focused on getting more people to buy more products in emerging markets.

“The potential for growth is amazing,” said Mr. McDonald, saying P&G is offering more low-priced versions of its products to lure lower-income consumers. He also said the world’s largest consumer products company will take advantage of its size and brand strength.

He said while the average Mexican spends about $20 a year on P&G products in that country, Chinese per-capita spending on the company’s goods is only about $3 and India $1. Getting usage in those giant countries to Mexico levels would add some $40 billion in sales, he said.

Mr. McDonald also pledged to streamline P&G operations to make the company more efficient and fast-responding.

P&G officials said recently they expect sales to start coming back this fall around price cuts, new products and value-focused promotions, after falling 3 percent, to $79 billion for the last fiscal year. The company will report first-quarter results Oct. 29.

Coming out of one of the toughest years P&G has faced in more than 50 years, Mr. McDonald said the company today served about four billion of the world’s seven billion consumers but aimed to reach five billion over the next five years.

Mr. McDonald said: “Our choices are a natural evolution of the strategies that have been working for nearly a decade. We will grow leading, global brands and core categories. We will build our business with under-served and un-served consumers and we will continue to develop faster growing, structurally attractive businesses with global leadership potential.”

“More than at any time in our company’s 170-plus year history, we have the brands, capabilities, strategies and financial flexibility necessary to expand our product portfolio into more parts of the world.”

Geographic and portfolio expansion coupled with a focus on simplifying business structure and processes, leveraging scale and enhancing execution will all be elements of P&G’s long term growth success, he added.