“The best response to what we are challenged with today is to push forward, not to pull back, and that’s exactly what we intend to do,” said Jon Moeller, Vice Chairman, COO & CFO of P&G during the company’s Q3 2020 earnings call, for the period ending March 31, 2020.
During the month of March, due in large part to frenzied pre- and early-quarantine shopping, P&G achieved organic sales growth of 10% in the U.S. While prioritizing the health and safety of the P&G team, Moeller explained, during the recent earnings call, how their products “are more important than ever.”
P&G Is Maximizing Availability Of Their Products During The Pandemic
“We’re maximizing the availability of products that help people and their families with their health, hygiene and cleaning needs, which have never been greater,” noted Moeller on the April 17th P&G earnings call. Moeller specifically commented on the increased usage of cleaning products:
- Hand soap usage is up as people fervently and frequently wash their hands - especially as hand sanitizer became hard to find.
- “Consumers in the U.S. are doing more laundry loads per week,” articulated Moeller, “and washing more garments after wearing them just once.”
- Dish soap consumption has also climbed “as families eat more meals at home and are more concerned about the hygiene of their dishes, glasses and silverware.”
- Home surface cleaning products, inclusive of Swiffer, Mr. Clean and Bounty, have been seeing more use in recent days as consumers show “a preference for a disposable cleaning solution versus a funky sponge, dingy cloth or suspect mop.”
As a result of coronavirus-related consumer behavior changes, P&G set records for both products produced and shipped during the month of March, and many of their products kept flying off the shelves.
P&G Is Continuing To Prioritize Personalized Marketing
In 2010, P&G launched a 10-year brand building initiative that included the creation and use of mass personalization at scale. “Looking back on that,” said Marc Pritchard, the Chief Brand Officer for P&G. “It was very clear that  was too early, because the technology really wasn’t there at that point. But at least the vision was there, and it gave us a north star to where we’re at now [in 2020], which is reinventing brand-building from the mass marketing of the past to one-to-one brand building on a mass scale using data and digital technology.”
During their Q4 2019 earnings call, P&G credited “propensity marketing” and their database of more than 1 billion global consumers with much of their organic growth success. Although P&G did not achieve “mass personalization at scale” by early 2020, they successfully created “smart audiences” focused on the intersections of behaviors, mindsets and P&G products. “We start with understanding our consumers and their needs, wants and aspirations,” said David Taylor, P&G Chairman of the Board, President and CEO, during the Q4 2019 P&G earnings call. “We then create advertising that makes you think, talk, laugh, cry, smile and, of course, buy.”
Understanding Consumer Behaviors Is Essential During The Pandemic
“We need to stay very close to consumers and their habits needs and desires more now than ever,” advised Moeller during the P&G Q3 2020 earnings call in April, signifying a consistent focus on aligning P&G products and messaging with consumer needs, wants and aspirations. The P&G leadership team meets three mornings a week, according to Moeller, to discuss changing consumer needs and to make sure P&G is positioned to “serve those changing needs.”
The CPG industry is highly competitive, and the P&G team realizes success, in the words of Moeller, requires agility and “an ongoing mindset of constructive disruption and disruptive possibility.”
P&G Is Taking Social Responsibility Seriously During Coronavirus Days
During the Q3 2020 earnings call, Moeller expressed that “P&G has a long history of supporting communities in times of need.” Currently, P&G is donating products around the world to help “ensure that families have basic access to the everyday essentials many of us take for granted,” said Moeller. To achieve their mission of helping communities, P&G has partnered with a long list of relief organizations, including the International Federation of Red Cross, Americares, Feeding America and The United Way.
P&G Is Supporting Healthcare Workers And First Responders
P&G is doing what they can to help people on the first line cope with the health concerns and realities of COVID-19. For example, the CDC recommends proper shaving when wearing N95 and similar masks, so P&G-owned Gillette is “donating razors around the world to hospitals and other facilities to protect the people working to care for others,” according to Moeller. P&G has also transitioned some of their equipment and plants to produce and donate hand sanitizer and face masks.
P&G Is Leveraging Their Marketing Expertise To Encourage Social Distancing
“We're using our marketing and communications expertise to encourage consumers to support public health measures to help flatten the curve and slow the spread of the virus,” stated Moeller.
In late March, P&G launched the #DistanceDance viral campaign, in partnership with Ohio Governor Mark DeWine, TikTok and social media influencer Charli D’Amelio. “Our intent is to be useful by encouraging people to keep their distance and stay home,” commented Pritchard about the project. “We wanted to find a creative way to engage people and inspire them to take action so they could stay safe and healthy.” Within about a week, the #DistanceDance campaign achieved 8 million views and triggered many donations to nonprofits helping communities deal with coronavirus-related challenges.
P&G Is Preparing For The Return To ‘Normal’
During the early stock-up period of the coronavirus quarantine, many consumers were purchasing whatever products were left on the shelves - even if the brands did not align with their typical preferences. In some cases, P&G achieved trial purchases, when consumers bought P&G brands instead of competitor products. In other cases, P&G products were sold out, and loyal P&G customers tried other brands. During the Q3 2020 P&G earnings call, Moeller discussed how P&G will “need to work hard to ensure that we maintain mental and physical availability to the greatest extent possible so that those consumers [loyal P&G customers forced to purchase non-P&G brands] return to their beloved and trusted brands which are ours, as they’re [P&G products] more fully available.”
P&G Will Not Be Pulling Back On Advertising During COVID-19
“This is not a time to retrench,” said Moeller as he confirmed the company’s intentions to keep the advertising for P&G brands strong, even in the face of supply issues and an impending recession. Moeller confirmed that P&G will be “doubling down and moving forward, not backwards.”
The P&G leadership team does not anticipate dissipation of product demand. In fact, they are expecting and planning for the continued increase in time spent at home and meals eaten at home, both leading to the need for more P&G products. “The importance of noticeably superior performance potentially grows,” asserted Moeller. “There is potential for increased preference for established, reputable, dependable brands that solve newly framed problems better than other alternatives.”
Though Moeller confessed, “I’m not an advertising expert,” he offered the following with regard to the need for continued advertising: “Helping consumers understand how they can meet their own perceived and critical needs for them and their family through the use of our products in many categories is a public service.” Further expressing his conviction, Moeller repeatedly commented that P&G plans to “double down to serve consumers.”
P&G expects “to come out of this [the pandemic] stronger than we went into it,” Moeller stressed. “We really do believe there is a bright future ahead.”
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