P&G discovers the joys of brand management – again

It’s back to the future at the world’s biggest advertiser Procter & Gamble.

The giant consumer goods company has re-installed AG Lafley as CEO in place of Bob McDonald and announced that it is shifting from ‘marketing’ to brand management – which seems sensible enough as P&G invented brand management in the first place.

Specifically it was one Neil H. McElroy (below), an ad manager at P&G in the 1930s who penned his famous ‘Brand Man’ memo. You can see the original here. McElroy went on to become President Eisenhower’s Defense Secretary in 1950s, at the peak of the Cold War when the world was awash with nuclear missiles.
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Flogging Ariel and Charmin isn’t quite such a life and death matter but P&G has been in the doldrums recently with like-for-like growth slowing and ancient rival Unilever doing rather better in the global stakes.

New style P&G brand management is supposed to work as follows (bear with us, this is courtesy of the useful Brandchannel): In the new P&G paradigm, “Brand Management” under Global Marketing Officer Marc Pritchard now encompasses four functions: brand management, formerly known as marketing; consumer and marketing knowledge, also known as market research; communications, including what used to be called external relations; and design. And P&G’s Brand Management organization will now be housed entirely within its global business units rather than parts residing in reconfigured regional units.

All clear? Good.

What difference, if any, will this make to P&G’s agencies? McElroy-style brand management clearly works (or worked) and having one executive directing a brand rather than a group of them sticking their oars in seems to make sense – if that, indeed, is what now happens.

Logically there should be a round of agency pitches as the new brand supremos select their chosen partners. Which might alarm Publicis Groupe, P&G’s main agency partner.

We may also see P&G following in Unilever’s footsteps by divesting some low-performing brands. It should be easier now to see which ones are working and which are not.

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About Stephen Foster

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Stephen is a former editor of Marketing Week and London Evening Standard advertising columnist. He wrote City Republic for Brand Republic and is a partner in communications consultancy The Editorial Partnership.