P&G CEO claims target of 5 billion consumers is on track

By Simon Pitman

- Last updated on GMT

Related tags Procter & gamble

During Procter & Gamble’s annual meeting, CEO Bob McDonald says his company’s growth plan is on track to achieve its target of five billion consumers in five years.

McDonald said the company had added a further 200 million consumers during the course of the last year, bringing the total number of consumers it reaches out to across the world each year to 4.2 billion.

The CEO stated that the company “made substantial progress in fiscal 2010, when organic sales grew 3 percent, core earnings per share rose 6 percent, and adjusted fee cash flow was 125 percent of net earnings.”

Innovation key to the performance

The performance has been pinpointed on innovation, which over the past year has concentrated on the company beefing up the portfolio with new and increasingly technical products.

“Innovation that truly improves people’s lives is more important than ever because many of the economies in which we operate are still recover from recession,”​ said McDonald.

“Our own experience show that company that continue to invest in innovation during economic downturn enjoy more growth in the years that follow – primarily because they keep their promises to consumers when those promises matter most.”

Roll out of Fusion ProGlide

With regards to product innovation in the personal care arena, McDonald highlighted the launch of the premium-priced Fusion ProGlide in the US market, just over four months ago.

Last month P&G said it wants to introduce its Olay skin care brand into 15 new markets worldwide in the course of the next financial year at an investor conference.

Speaking at the Barclays Capital Back to School conference in Chicago yesterday, P&G’s vice chairman of global beauty and grooming brands Ed Shirley stated that the objective to grow the Olay brand would form a key part of its global growth strategy in the future.

Gorwing Olay in developing markets

Shirley said the emphasis for the brand this year would be new markets, and underlined Brazil, currently one of the fastest growing retail markets in the world, as a key focus for the push.

The expansion of the brand is also expected to continue into 2011, with the ultimate aim being to increase the number of markets where Olay is sold from the current figure of 69 to 100 over the course of the next two years.

In fiscal 2009, P&G estimated that the Olay brand accounted for approximately $2.8bn of the group’s total $79bn revenues. It is currently the leading skin care brand in a number of the biggest global markets, including China, the UK and the US.

The company’s beauty and grooming operations have grown from a $9bn turnover to $27bn turnover in just seven years, growth that has been fueled by both organic growth and acquisitions, including the Gillette business.

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