P&G Heads for the Database Abyss
And they all went bust.
Elva Lewis’s Pipe-dream
Lewis, who has been with P&G for 21 years, told AdAge.com, “We want solid relationships with 40 million to 60 million households. Right now, we have decent relationships with 10 million.”
Working with Targetbase, an Omnicom agency, Lewis has segmented her market into nine or 10 groups that she calls “cohorts”—new moms and baby boomers, for example. To new moms, she wants to promote Pampers and Tide.
“Never try to sell two things at once,” said the late direct marketing guru, Dick Benson.
“Our long-in-the-tooth marketers think that TV is a cheap way to get mass reach and that targeted marketing is an expensive way to get smaller reach,” Lewis told AdAge.com. “We haven’t been entirely successful at breaking through their thinking. We can use targeted scale and let the fixed costs of direct marketing—list buys, acquisition, response modeling, mail and fulfillment—be spread across 10 brands. It doesn’t work for P&G otherwise.”
P&G has 86 brands, mostly low-cost household and beauty items. Among them: Duracell, Crest, Iams, Folgers, Pampers, Tide, Pantene, Bounty, Cascade, Swiffer, Charmin, Olay, Prilosec, Pepto-Bismol and Pur Water Filters.
Does brand loyalty exist for Duracell batteries during a half-price sale on Energizer? Will a new mom buy Tide if a same-size container of Era on the shelf above is a buck-and-a-half cheaper? Will she ignore the low price on Scott’s in order to stock her kitchen with Bounty towels and her bathroom with Charmin?
Maybe she will be loyal to Crest and Pantene—items she puts in her mouth and her hair. And her Pur pitcher can only take Pur filters. But the other stuff?
When she buys Pampers, on the back of the cash register tape will be a hefty discount coupon for Huggies.
Chances are most decisions in the package-goods world are price-driven with loyalty out the window.