The consumer packaged goods (CPG) company, whose brands include Tide, Pampers, Oral B, Gillette and Pantene, aims to serve customers in the channels they shop and at the price points they seek, Procter & Gamble Chief Financial Officer Andre Schulten said Friday (Oct. 24) during the company’s quarterly earnings call.
A substantial portion of consumers buy the company’s larger pack sizes as they shop “in mass, in club and online,” Schulten said.
Another group of consumers, those living paycheck to paycheck, want to make a smaller cash outlay and seek low, promoted prices, Schulten said.
“I think the right answer to the environment we’re in is to serve the consumer where they want to shop and with the cash outlay and the value tier that they are prepared to go after,” Schulten said during the call. “And I think we have built very strong price ladders across different pack sizes. We continue to optimize those.”
Procter & Gamble takes a similar approach with the products themselves, seeking to provide competitive options for customers who are looking to trade-up and those who want to trade-in.
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In each product category — Schulten offered examples in laundry detergent and cosmetics — the company aims to upgrade and innovate the super-premium product, the premium one, the mid-tier one and the value one.
“Where we choose to play, we choose to be superior, and that’s across all value tiers,” Schulten said. “So, when we innovate, we innovate across all tiers.”
Schulten also provided an update on Procter & Gamble’s restructuring efforts. It was reported in July that Schulten said the company would be undertaking a two-year restructuring program in which it would cut jobs and exit some brands and markets.
During Friday’s call, Schulten said the company plans to eliminate 7,000 non-manufacturing roles, which amounts to 15% of its current non-manufacturing workforce, and equip the remaining staff with new technology and data.
“As part of the two-year program, we are making additional organization process and technology changes to enable an even more agile, empowered and accountable organization, making roles broader, teams smaller and faster, and work more fulfilling and more efficient, actively reducing, eliminating or automating internal work processes, supporting teams with data and technology to increase capacity and capability to focus on integrated plans to deliver superior propositions to our customers versus spending time internally,” Schulten said.
Procter & Gamble is also gearing up for agentic commerce. Asked by an analyst about this emerging technology, Schulten said that during its 187-year history, the company has seen the development of supermarkets, hypermarkets, online shopping and social commerce, as well as radio, TV, internet and social media.
Schulten said the way he thinks about changes like these is “all opportunity.”
In the case of agentic commerce, companies must understand the consumer, how they look for information, how agents will find products, how agents will decide which products to put in the basket, and how companies can “communicate your superior brand proposition every day and every shopping opportunity.”
“I feel we’re well positioned,” Schulten said, speaking of Procter & Gamble. “I feel our data infrastructure, our consumer understanding, our collaboration with retail partners, is very good. So, again, for me, this is all opportunity.”
