Pert Plus Essay

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Executive Summary Proctor & Gamble Inc. Canada (P&G) is a wholly-owned subsidiary of U.S. multi-national Proctor & Gamble, Inc. The Company is a leading manufacturer and marketer of consumer goods and industrial products. The Canadian hair care market was valued at $460 million in retail sales in 1986. The market was predicted to grow by 2% per year for the next four years. The shampoo / conditioner market segment accounted for 64% of the total hair care market. P&G Canada markets five brands of shampoo in Canada, including Pert. Pert was introduced in Canada in September, 1981. Pert did not reach the company’s 6% sales objective within the first year. Market share began declining in 1983 and by 1987 was less than 1% of the market. In 1986 P&G developed a revolutionary new shampoo formula that combined the cleaning properties of a shampoo with those of a conditioner. Following a successful launch in the U.S. it was decided to re-launch this product as a “new-improved” version - Pert Plus, in Canada. Examining internal and external factors affecting the success of the product launch it was shown that the positive factors outweighed the negative. Pert Plus was a breakthrough product and P&G would have first-mover advantage in the largest segment of the hair care market. Negatives were the poor performance of the original Pert shampoo and the perception it was a product for men. Establishing the optimal price in the Canadian market was one of P&G’s biggest challenges. The company had to make three pricing decisions. 1. Retail price vs. the competition. Price the product at parity or at a premium; 2. Level and extent of trade price promotions to retailers 3. Level of listing allowances to retailers to overcome the resistance to provide shelf space to the product due to the poor sales performance of Pert The main

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