As marketing strategies go, “we plan to offer consumers less choice” is an unusual one. Certainly it is not a line you hear consumer goods supremos say out loud too often. Instead, the mantra for decades has been one of more choice, more options – a shampoo tailored to the variables of your hair, a soap “formulated” for your precise quality of skin.
Now Procter & Gamble chief executive AG Lafley has had enough – or rather, he believes consumers have had enough. The man who oversees the manufacture of Gillette razors, Always sanitary towels and Pampers nappies says the company will sell or discontinue about half of its brands in the next two years in a bid to cut costs and revive sales growth.
Again, the correlation between sales growth and dispensing with brands – even if they are underperforming ones – may seem odd. But Lafley has a philosophy, and it is that “less will be much more”.
The proliferation of scents, flavours, colours and packaging shapes has peaked, as far as he is concerned. “There is a lot of evidence in a number of our business categories that the shopper and the consumer really don’t want more assortment and more choice,” he told analysts on Friday.
But it would be wrong to interpret Lafley’s remarks as the “death of brands” per se. He isn’t saying consumers don’t want assortment and choice. He is arguing that there is such a thing as too much assortment and choice, and maybe even some merit to the theory that, when faced with a dazzling array of 47 different fabric softeners, consumers panic and walk away with none. According to this theory, P&G’s also-ran brands and product varieties aren’t just letting themselves down, they’re also holding back sales of the “winner” brands.
This "safe" list of 70-80 core brands that account for 95 per cent of P&G profits is likely to include Oral B, Pantene, Olay, Tampax and Old Spice, as well as the aforementioned Gillette, Always and Pampers.
On the other hand, it seems fair to assume the glory days of some of its celebrity perfume ranges (cough, Christina Aguilera, cough) are behind them.
Otherwise, there’s a guessing game to be played as to which household products might be price-tagged and put on display. Anyone for the Clearblue pregnancy testing kit business? How about some Pepto-Bismol? The time may now have come for another consumer goods behemoth to take on the Daz doorstep challenge.
Still, shoppers are unlikely to see too many of their favourites disappearing from the shelves any time soon. If they do, it probably won’t be Lafley that is to blame, but a decision by their supermarket to destock products in categories where they want their own-brand ranges to increase market share.
