One year after laying out plans to cut $10 billion in costs by fiscal 2016, the Procter & Gamble Co. said it is moving full steam ahead to improve productivity.
At the Consumer Analyst Group of New York Conference held in Boca Raton, Fla., on Thursday, the company’s chief financial officer, Jon Moeller, reiterated that the plan consists of trimming $6 billion from costs of goods sold, $3 billion in nonmanufacturing overhead and $1 million in marketing.
Change is well under way at P&G, said Moeller. The $84 billion company has surpassed plans to reduce head count by 5,700 by the end of fiscal 2013 by eliminating 5,850 roles by the end of January 2013. A number of those posts, or roughly 1,000, have come from streamlining its marketing organization from five tiers, “or five hand-offs of work” to three tiers — namely global concept, regional tailoring and local execution. The change gives the company “a better line of sights from design to execution,” said Moeller. He added that P&G, which spent $13.7 billion on advertising and marketing last year, is focusing its efforts on “fewer, bigger ideas that can travel around the world.”
The company also aims to stretch its dollars by shifting its spending from TV advertising toward digital media, which Moeller called a “higher return on investment.”
P&G’s hope is that the host of new products across hair care, makeup and skin care will give a jolt to its beauty sales, which, for the quarter ended Dec. 31, inched up 1 percent to $5.4 billion while unit volume was flat.
Moeller said the new Pantene Expert Collection, introduced in the U.S. last November, will expand to Latin America this quarter. Items in the collection are priced between 200 and 250 percent above Pantene’s base line. P&G’s introduction of Illumina Color by Wella has added 7,000 salons and will roll out to Latin America, and Australia and New Zealand in March. Other new products include Vidal Sassoon hair care, the reformulated Olay Regenerist, and a line tailored for young women called Olay Fresh Effects.
The company continues to train its sights on developing markets, which accounted for 38 percent of sales in 2012, or $32 billion. Moeller noted that in 2012, the company’s sales in Asia were $15 billion, up from $1.5 billion in 1991; in Latin America, sales were $8.3 billion, up from $1 billion in 1991, and in Central and Eastern Europe, Middle East and Africa, sales were $12.1 billion, up from less than $1 billion in 1991.
Moeller said, “We know there is significant more upside for trade up as the wealth across developing markets increases and as we continue to globalize premium innovation.”
As one of the most recognizable models in the world, Christy Turlington Burns has an insider’s view of the fashion industry and the allegations of sexual harassment swirling around it. “I can say that harassment and mistreatment have always been widely known and tolerated in the industry. The industry is surrounded by predators who thrive on the constant rejection and loneliness so many of us have experiences at some point in our careers,” Turlington told WWD, along with her suggestions for how the modeling world should protect younger women and men. Read more on WWD.com. Link in bio. (📷: Tony Palmieri) #wwdnews
@asics America has tapped a new brand ambassador: famed DJ/record producer @steveaoki. This initiative is intended to set the tone for the new brand identity and philosophy and will include partnerships with influencers and in-store and off-line activations that will continue into next year. This is Asics’ most significant marketing effort in two decades, and is expected to attract younger consumers to the brand. #wwdfashion
24-year-old Jean Prounis is redefining the rules of jewelry. Formerly a studio assistant to Jemima Kirke and a design apprentice at Ghuran, she focuses on handcrafted subtleties and ancient goldsmithing techniques. “There was a really sterile feel in the environment and I wanted to have jewelry with character that shapes how you wear it everyday,” Prounis said. Each piece is hand made in New York, either by Prounis or three other jewelers in the district. #wwdfashion
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Amid the Harvey Weinstein controversy, there’s another sector that’s being put under the spotlight for sexual abuse: the modeling industry. While rumors about abuse and sexual harassment of female and male models — and the photographers, agents and others who perpetrated it — have circulated within the fashion world for years, model @cameronrussell started posting stories from models on Instagram last week about abusive situations they’ve encountered — from sexual harassment and molestation to attempted rape. Over 75 have weighed in so far. Read more on WWD.com. Link in bio. #wwdnews
To celebrate its 16th anniversary, @dylanscandybar tapped designers and celebrities to create mosaics out of candy. The mosaics will be auctioned off to support the philanthropic cause of each participant’s choice. Pictured here is the mural created by @aliceandolivia's Stacey Bendet. For a first look at some of the other artwork being unveiled tonight, go to WWD.com. #wwdeye
The annual Veuve Clicquot Polo Classic in Pacific Palisades this weekend drew Kate Hudson, Tracee Ellis Ross, Laura Dern and more. See pictures of the star-studded event on WWD.com. (📷: @chelsealaurenla) #wwdeye
In his new book “Hollywood Royale,” Andy Warhol’s Protégé Matthew Rolston celebrates the Eighties revival of Hollywood glamour. Featuring more than 100 portraits taken by Rolston from 1977 to 1993, the book contains photos of icons like Michael Jackson, Cyndi Lauper, and @drewbarrymore, pictured here in 1991. “Hollywood Royale,” out today, will be accompanied by an exhibition opening at Los Angeles’ Fahey/Klein Gallery on March 1. #wwdeye