Gillette lost $8 Billion following last year's ad campaign. Apparently customers don't like being told that they don't measure up to the moral vision of international mega-corporations.
" Wall Street largely overlooked the Gillette writedown, sending P&G shares to an all-time high as the conglomerate reported a strong quarter of organic sales. P&G rose 3.8 percent Tuesday, to $120.41."
Sadly, the "parent" company doesn't feel the pain that their acquisition has suffered.
Probably only part of the problem; most likely, P&G overpaid for Gillette, as tends to happen when the corporate mating instinct is strong.
But I do wonder: to what extent will the negative effect of 'wokeness' on the part of certain businesses (which are subsidiaries of larger companies) have on the broader product lines of those companies? P&G sells a lot of things other than razor blades: will this marketing program on the part of a subsidiary CEO wind up impacting businesses which are not in his purview?
And I'm not sure how many people have caught on: CNN is owned by AT&T. NBC/MSNBC, owned by Comcast. ABC, owned by Disney.
There is little to connect the adverse effects of the advertising campaign to actual sales - these are closely held company secrets. And there is no commentary at all from Gillette explaining why the company has applied such a remarkable writedown this quarter (at least that I've been able to find - I'm still looking). The only data results available from the misandrogynistic ad campaign are the preponderance of down-votes on YouTube - and these are overwhelming. I suspect the absence of discussion about the ad campaign results, in particular the numbers that would indicate success, is all the proof we will see that this is a failed effort. If it had been successful, they wouldn't stop crowing about it. But, funny thing, I don't hear much from Dick's anymore, nor Gillette, nor any of the other companies featuring Boards Without Backbones. Just Section B of the Business Section results about another bad quarter with the analysts all wondering why.
I didn't see anything specific about the ad campaign.
Seems to me that P&G has largely been a creation of the era of television mass advertising & branding supporting store sales, and they are not likely to do as well in the future.
Umnnhhh....Gillette's write-down of $5+ BILLION.....is the result of their stupid ad?
Well, that's the height of post-hoc/propter-hoc. Gillette may well die out as a brand due to its numbskull 'marketing' effort, but it won't be soon. And it certainly did not cost them net/net $5++ BILLION in one year.
" P&G has largely been a creation of the era of television mass advertising & branding "
Well, not exactly. Some, yes. But P&G has led the industry in a bunch of not-obvious improvements. "Electronic Data Interchange" (EDI) for dealing with brokers, retailers, suppliers etc with less paperwork and rapid response. The related Universal Product Code (UPC) allowing better inventory tracking. Reduced packaging. Much of this stuff started in the 1980's and has about maxxed out in returns to investment. And, having demonstrated success, P&G sees all the smaller rivals embracing the improvements right out of the starting block. Right now it appears to me P&G's business processes are optimized for WalMart, Target and Safeway/Kroger. As Amazon and THAT generation of marketeers come to full power, P&G will have to adapt or lose ground.
JM...I'm familiar with EDI & the related UPC, the importance of which are less well-recognized than they should be. While P&G was indeed one of the pioneers, it wasn't the only one, and these technologies had penetrated pretty deeply by the early 1990 (pre-commercial Internet, let it be noted.) And while they have great benefits for inventory reduction, administrative cost reduction, and avoiding out-of-stock situations, they don't have much to do with motivating end customers to want a particular product.
8 comments:
Couldn't have happened to a nicer (and smarter) company.
" Wall Street largely overlooked the Gillette writedown, sending P&G shares to an all-time high as the conglomerate reported a strong quarter of organic sales. P&G rose 3.8 percent Tuesday, to $120.41."
Sadly, the "parent" company doesn't feel the pain that their acquisition has suffered.
Probably only part of the problem; most likely, P&G overpaid for Gillette, as tends to happen when the corporate mating instinct is strong.
But I do wonder: to what extent will the negative effect of 'wokeness' on the part of certain businesses (which are subsidiaries of larger companies) have on the broader product lines of those companies? P&G sells a lot of things other than razor blades: will this marketing program on the part of a subsidiary CEO wind up impacting businesses which are not in his purview?
And I'm not sure how many people have caught on: CNN is owned by AT&T. NBC/MSNBC, owned by Comcast. ABC, owned by Disney.
There is little to connect the adverse effects of the advertising campaign to actual sales - these are closely held company secrets. And there is no commentary at all from Gillette explaining why the company has applied such a remarkable writedown this quarter (at least that I've been able to find - I'm still looking). The only data results available from the misandrogynistic ad campaign are the preponderance of down-votes on YouTube - and these are overwhelming. I suspect the absence of discussion about the ad campaign results, in particular the numbers that would indicate success, is all the proof we will see that this is a failed effort. If it had been successful, they wouldn't stop crowing about it. But, funny thing, I don't hear much from Dick's anymore, nor Gillette, nor any of the other companies featuring Boards Without Backbones. Just Section B of the Business Section results about another bad quarter with the analysts all wondering why.
Here's the P&G earnings conference call, including analyst Q&A, with some discussion of the Gillette writedown.
https://seekingalpha.com/article/4279183-procter-and-gamble-company-pg-ceo-david-taylor-q4-2019-results-earnings-call-transcript?part=single
I didn't see anything specific about the ad campaign.
Seems to me that P&G has largely been a creation of the era of television mass advertising & branding supporting store sales, and they are not likely to do as well in the future.
Umnnhhh....Gillette's write-down of $5+ BILLION.....is the result of their stupid ad?
Well, that's the height of post-hoc/propter-hoc. Gillette may well die out as a brand due to its numbskull 'marketing' effort, but it won't be soon. And it certainly did not cost them net/net $5++ BILLION in one year.
" P&G has largely been a creation of the era of television mass advertising & branding "
Well, not exactly. Some, yes. But P&G has led the industry in a bunch of not-obvious improvements. "Electronic Data Interchange" (EDI) for dealing with brokers, retailers, suppliers etc with less paperwork and rapid response. The related Universal Product Code (UPC) allowing better inventory tracking. Reduced packaging. Much of this stuff started in the 1980's and has about maxxed out in returns to investment. And, having demonstrated success, P&G sees all the smaller rivals embracing the improvements right out of the starting block. Right now it appears to me P&G's business processes are optimized for WalMart, Target and Safeway/Kroger. As Amazon and THAT generation of marketeers come to full power, P&G will have to adapt or lose ground.
JM...I'm familiar with EDI & the related UPC, the importance of which are less well-recognized than they should be. While P&G was indeed one of the pioneers, it wasn't the only one, and these technologies had penetrated pretty deeply by the early 1990 (pre-commercial Internet, let it be noted.) And while they have great benefits for inventory reduction, administrative cost reduction, and avoiding out-of-stock situations, they don't have much to do with motivating end customers to want a particular product.
Post a Comment