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Shirley Shows His Team Spirit

Ed Shirley proved he’s a team player while delivering a keynote speech with the theme Rising Tides.

Ed Shirley’s competitive streak may have propelled him to the top ranks of corporate America, but he proved he’s a team player while delivering a keynote speech with the theme Rising Tides. Shirley, who is the vice chair of beauty and grooming at Procter & Gamble Co., sounded a clarion call for the industry to work together.

Shirley outlined three areas in which the industry can collectively reignite growth: regimen-based skin care, particularly in the men’s market; fragrances, and customer engagement. “This is where we are going to focus our energy,” Shirley said, “and I invite you to think about how you might play like this in the future as well.”

In terms of regimen-based skin care, Shirley revealed P&G’s game plan for converting men from a soap-and-water routine to more involved treatment regimens. “I know the idea of regimen is almost as old as the beauty industry itself,” he laughed. “However, it’s still a fairly new concept for the other 50 percent of the population — men.”

To that end, P&G is focusing much of its efforts behind Gillette, its powerhouse shaving brand. “Shaving is the anchor event in most men’s daily ritual,” he said, adding that marketers must keep the message simple. P&G will leverage the step-by-step approach pioneered by its recently acquired Art of Shaving brand for its global offerings, Shirley said, including Olay Men’s Solutions in China, Gillette Skin Care in Western Europe and Gillette’s ProGlide Series skin care, launching in North America.

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As part of its efforts to entice more men to skin care, P&G has focused on improving the shopping experience. “We need to help men more easily find the products they need, as well as what’s new,” Shirley said. “Men get confused at the shelf. They want to get in and out as quickly as possible.” Thus, P&G has been working with retailers to create a “man cave” within the store, an environment where men will feel comfortable. The approach has paid off, said Shirley, with double-digit category growth in many cases.

Shirley also tackled the declining fragrance business in the U.S., noting the market in Western Europe is almost two-and-a-half times the size of North America. “Is it because men and women in Europe are sexier? Are they smarter?” he quipped, quickly turning serious as he noted that retailers are losing patience with the category and considering cutting back space.

The fix? Decreasing the number of fragrance launches and enhancing those that are brought to market. “I understand that the barrier to entry is low,” Shirley said, “but what’s up with the number of launch-and-leave celebrity fragrances introduced each year?”

The sheer proliferation is driving consumers away, Shirley asserted. “Our research shows that with a 25 percent reduction in stockkeeping units, shoppers actually give retailers credit for having a broader assortment and an increase in purchase intent.”

That insight has led P&G to take a less-is-more approach that centers on its classic brands, particularly Gucci and Dolce & Gabbana, and one that emphasizes consumer education.

The company is also looking at diverse distribution models. “I find myself often engaged about where fine fragrance should be carried and merchandised,” Shirley said. “My belief is there’s room for both prestige channel and mass distribution with the appropriate and differentiated lineups,” he continued, noting that today’s teenager who uses scented body spray is tomorrow’s prime prospect to trade up to prestige fragrances.

Adding that the mass fragrance environment is “often a hodgepodge of mass and diverted prestige products displayed under lock and key without any consultation, education or inspiration,” he continued, “we’re all going to have to figure out how to do this in developing markets, so we might as well relearn how to do it in developed markets and enjoy the benefits.

“By our calculations,” he added, “raising the North American fragrance shares to Western European levels would result in $6 billion of incremental sales.”

Shirley’s third pillar for driving growth centered around engaging the new consumer. He cited the development of Olay’s Pro-X brand, which broke price barriers at mass and garnered a 5 percent market share in its first year, despite the recession. P&G had the confidence to stay the course, Shirley emphasized, because consumer research showed that the brand proposition — dermatologist developed and recommended products available in an everyday shopping environment — was a resonant one.

Shirley concluded by reiterating his message of collective growth. “We have all of the products, brands, retail stores and communication vehicles we need to make a difference,” he said. “Sure, we can steal share, and we’re not bad at that,” he continued, “but it will be a lot more rewarding for everyone if we grow the size of the pie. But it will take more than just P&G Beauty & Grooming. It will take all of us in this room.”