P&G Meets Shifting Shopper Expectations With Household Staples, Digital Innovation

The way shoppers shop has changed over the past five years.

However, as Procter & Gamble’s second-quarter 2025 earnings showed, some things remain the same. Consumers need household staples like cleaning products, toilet paper and laundry detergent.

“The P&G team delivered an acceleration in organic sales growth, core EPS growth and strong cash return to shareowners in the second quarter,” Chairman of the Board, President and CEO Jon Moeller said in a Wednesday (Jan. 22) press release.

Net sales in the second quarter of fiscal year 2025 were $21.9 billion, a 2% increase versus the prior year.

P&G’s diversified portfolio of products — spanning beauty, grooming, healthcare, fabric and home care, and baby, feminine and family care — saw varied outcomes across categories. Organic sales in beauty rose by 2%, buoyed by innovation in hair and personal care, although declines in the Greater China market tempered growth. Grooming posted similar growth, with innovation offsetting “unfavorable geographic mix,” per the release.

Healthcare saw a 3% increase in organic sales, driven by premium offerings in oral care and personal health. Fabric and home care and baby, feminine and family care reported organic sales growth of 3% and 4%, respectively, showcasing resilience in categories often considered staples in consumer budgets. Double-digit growth in the family care segment was driven by “strong volume growth,” the release said.

Innovations and Consumer-Centric Strategy Drive Competitive Advantage

At the core of fast-moving consumer goods (FMCG) is the growing intersection between innovation and customer-centric offerings.

P&G executives told investors on Wednesday’s earnings call that P&G’s success lies in its ability to combine innovation with an understanding of consumer needs.

From launching premium personal care products to enhancing sustainability across its supply chain, the company’s executives stressed that P&G is setting benchmarks for industry leadership. For instance, product innovations in the fabric and home care segment — including premium cleaning solutions — drove volume and margin growth.

“We have the strongest-paced innovation program,” Moeller said during the call.

Additionally, the company’s focus on digital transformation and eCommerce is paying dividends. With online sales accounting for an increasing share of revenue, P&G is capitalizing on shifting consumer behaviors and building a competitive edge as retail evolves.

By the end of 2024, PYMNTS Intelligence data found that the typical consumer had gone back to shopping in physical stores. However, “The 2024 Global Digital Shopping Index” found that an estimated 41% of retail shoppers did more of their shopping using digital means than they did before the pandemic. Nearly three-quarters of those consumers said they plan to stick with or accelerate those behaviors in the future.

On a segmental basis, P&G’s earnings results highlighted the benefits of its innovation-centric approach. Premium and super-premium product lines, such as SK-II in the beauty segment, demonstrated the efficacy of targeting higher-margin categories to offset volume pressures in price-sensitive regions. This strategy aligns with the growing preference among consumers for quality and sustainability, especially in developed markets.

See also: The CPG Playbook: Pivoting for Shifting Consumer Demands

While North America remains a growth engine, China’s underperformance continues to present challenges — a recurring theme for global FMCG companies amid ongoing geopolitical and economic uncertainty.

During the first quarter, P&G experienced its share of market challenges, particularly in China and the Middle East. Despite those earlier concerns, P&G’s reaffirmed guidance for fiscal year 2025 — with expected organic sales growth of 3% to 5% and core EPS growth of 5% to 7% — indicates confidence in its integrated growth strategy.

Yet, the company acknowledged headwinds, including commodity costs and currency fluctuations, as well as the non-recurrence of prior year tax and divestiture benefits.

“Our first-half results keep us on track to deliver within our guidance ranges on all key financial metrics for the fiscal year,” Moeller said in the release. “We remain committed to our integrated growth strategy of a focused product portfolio of daily use categories where performance drives brand choice, superiority — across product performance, packaging, brand communication, retail execution and consumer and customer value — productivity, constructive disruption and an agile and accountable organization.”