Speaking at the recent Cannes Lions International Advertising festival, CEO Bob McDonald said he expected more than half of the company’s growth to come from emerging markets.
However, in order to make the most of the potential these markets hold, the variety of brands and products offered has to be increased, he explained.
“We’re the largest consumer goods company in China. We’re four times bigger than our next largest competitor,” he said. However, the company’s presence in the market in China is much smaller than the US.
“…we’re only in about fifteen product categories there [in China] versus, let’s say, thirty-five in the United States,” he added.
“The average Chinese only spends about $3 a year on Procter & Gamble products versus over a $100 a year in the United States. So the growth potential is enormous.”
Achieving a full portfolio of categories and then a full range of brands within each category is how the company intends to take advantage of this growth potential.
A billion new consumers
McDonald also said P&G was looking to recruit 1 billion new consumers, moving from the current 4 billion to 5 billion.
In order to achieve this McDonald said the company was investing everywhere, including emerging and developed markets.
“We have twenty new factories that we are in the process of building right now – five on the drawing board and five about ready to start up. And one of the biggest investments of those twenty new factories is a new factory in the United States. So we’re continuing to invest in all markets…” he said.
L’Oreal and Unilever have also recently announced their plans to significantly grow their consumer base. L’Oreal released details of a three pronged strategy to add another billion consumers earlier this year and Unilever announced plans to double the size of the business.