Fighting slowing growth
The reason why P&G wants to adopt this strategy is clear at least. Its latest results showed slowing sales, caused by difficult market conditions such as “geopolitical disruptions” like Brexit and foreign exchange challenges.
Moeller also admitted the financial outlook was not “likely to be better in the medium term”, which is why the company is making several strategic changes.
With that backdrop, P&G needs to make sure it is being as efficient and effective as possible across the business, whether that is packaging, product or marketing.
“Don’t get me wrong – I think it’s well intentioned. P&G is clearly recognising that its advertising campaigns need to drive growth more effectively. It implies that is has a high bar, which is also good,” says Andy Brent, author of ‘The Growth Director’s Secret’ and former CMO at Barclays.
As part of the strategy change, P&G is also taking a more vigorous approach to its communications by testing the quality of its ads. A campaign must drive growth for a full year, and is judged by a panel. Always’ ‘Like A Girl’ has currently achieved that. But not everyone is a fan of P&G’s panel idea.
“Retrospectively looking at whether acceptable growth is being delivered is symptomatic of a company that has lost the ability to understand consumer motivations well enough to predict in advance whether a brand is positioned to grow or not,” Brent says.
Who is driving growth?
Brent also questions why it is a CFO explaining the strategy.
“It’s just strange for a CFO to be contemplating this concept. You wouldn’t expect a CTO to talk about a company’s HR strategy. It seems everybody’s chipping in because there’s a lack of focus. To me, that says there’s a lack of accountability when it comes to growing the business,” he explains.
Other FMCG brands have recently appointed chief growth officers. Coca-Cola is the most recent, getting rid rid of its global chief marketing officer function by merging it with customer, strategy and commercial leadership to create a new ‘chief growth officer’ role.
Questions have previously been raised over why this role is needed, but with P&G looking for new ways to seek out growth in a difficult market, appointing its own CGO could make sense.
“Appointing a growth director would be a big positive step, and companies should join the 21st century and learn how to use the new generation of neuroscience-based research tools that can assess propensity for growth before the ad is made,” adds Brent.
A push to be more premium?
Moeller admited during the call that he was worried about analysts misinterpreting the ‘Irresistibly Superior’ approach: “I’m very concerned here that there’s a misperception that a bar of irresistible superiority in products and packaging denotes higher prices or that we could get driven by a slogan and not by the consumer because that’s not what we’re all about here.”
Unfortunately, P&G might have missed the mark by not thinking through the implications of its message and by discounting the fact there are undeniably premium and elitist connotations attached to Irresistible Superiority.
“Countering accusations that Irresistible Superiority is just a premium strategy with the defence that it applies at every price segment in the market is head scratching stuff,” says Radley Yeldar’s Oliver.
“P&G’s Irresistible Superiority strategy and the way it is currently being communicated runs the risk of totally undermining its own point. Great, irresistible brands are compelling, credible and distinctive. This strategy seems to struggle to tick any of those boxes.”
Having a mantra for growth, whatever a company wants to call it, can help to focus the minds of employees and make it clear to them, analysts and shareholders what the priorities are. This one might sound a bit jargony but ensuring its brand managers have a laser focus on effectiveness and being the best they can be is no bad thing.
However, P&G will need more than a snazzy slogan to turnaround slowing growth. Innovation and a deep understanding of consumers will be key, especially as economic difficulties are unlikely to ease over the next few years. Reaching its irresistibly superior targets while at the same time cutting back on things like agency fees and media spend will be a difficult act to balance.
Read the full article on Marketing Week