Tide Thursday could have some impact on key consumer categories, but
it's not going to be as significant as this article would indicate.
Here's why;
Reality is price, positioning, and packaging are driven by key account
management. Market adjustments for key accounts are almost
instantaneous, especially for big and important accounts for P&G
and other large CPG companies.
Before the recession Wal-Mart had already pulled out all the stops to
get P&G prices as low as possible, while still maintaining Tide and
others as flagship attractor brands. The big grocery channel stores
have been doing the same to grow their own private labels as they use
leader brands to pull people into the store and then get them to switch
to their private labels through better price incentives. They were
doing so before the recession as they believe this to be necessary to
survive.
But P&G has something that few other consumer packaged goods
companies truly have, real, tangible, branded leadership and a solid
portfolio of flanker brands. The flanker brands handle much of the
dirty work, leveling the retailer price game playing field, to defend
the lead brands.
This special leadership buys P&G time to stick to their values and
to provide real added value for their retail partners who need them
more than ever. There are only a few other brand portfolios, if any,
that are sitting in this position.
That means, "Tide Thursday" already happens everyday on a regular real
time basis and has been occurring for more than a few years.
Few if any other CPG companies are in the ideal position P&G is in,
if they were, P&G would buy them or have a strategy to erode their
share.
And while P&G may state they're going to lower their prices on some
of their lead and secondary brands, many of those moves have already
been made through key account planning, with the majority of price
concessions falling on the flanker brands or through reconfigured
leadership brand packaging that offers more favorable average SKU
pricing, but provides less product in the select SKUs, to accelerate
the buy cycle improved average cost per measured unit to recoup profits
lost in declining share.
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