Always a safe bet

Though it opened in SA almost 14 years ago, global consumer goods giant Procter & Gamble is still playing catch-up here, says Andrew Peterson, the company's GM for South and East Africa.

“The company did not operate in apartheid SA. We opened here on August 29 1994, and it is one of the last markets we have entered,” Peterson said on a visit to Johannesburg recently.

P&G's well-known brands — Gillette, Pampers, Duracell, Braun, Pringles, Wella, Olay and many others — are imported to a central warehouse in Johannesburg and then distributed through a third party called Supply Chain Services, or shipped directly to stores.

The import system is growing unsustainable, says Peterson, a possible hint that the company is thinking about a more substantial presence in Southern Africa. But exactly what the thinking is he will not say.

“We have a long-term view in our perspective, in terms of where we invest and whatever we invest in. I think SA is a natural base for investment. The infrastructure is good, the economic stability is there,” Petersen says.

A local presence would fit with how the company sees its markets generally, and Southern Africa in particular.

consumers want value for money

“Value is more important in sub-Saharan Africa than in other parts of the world,” says Peterson. “People here have less disposable income, so they want to be sure they are getting value for their money before they spend it.”

He says the 170-year-old Cincinnati-based company, which is third on Fortune magazine's list of the world's most admired companies, prides itself on its culture, purpose and “good, solid midwestern values”.

“The company has strong ethical values about the quality of its products. We believe we sell small, meaningful improvements to the lives of the world's consumers — and in doing so we invest in success over the long term.

“There are 650m consumers in sub-Saharan Africa, and we need to be where the consumers are,” says Peterson.

But, he says, the company's philosophy of always looking for long-term success means it does not necessarily follow the latest investment fads.

“The Bric (Brazil, Russia, India and China) countries are where everyone is investing today. It's all the rage. Tomorrow it will be Southeast Asia or Latin America. That is not necessarily the way Procter & Gamble operates.”

Leading the way, since 1933

With a US$200bn market capitalisation and global turnover of $76bn, the company claims its products are used 3bn times daily across the world.

Peterson says the modern-day buzz around the concept of “brand management” started with P&G in 1933. “We have always focused on our brands, rather than the corporate name. We are the world's largest advertiser, and also one of the largest advertisers in SA,” says Peterson.

Brand management is not the only first the company claims. Among other “inventions” are fluoride toothpaste, and though it doesn't quite claim a patent for disposable diapers, Peterson says it was first to successfully market them — forever changing the lives of babies.

Even the English language owes a small debt: the term “soap opera”, Peterson reveals, originated from Procter & Gamble's sponsorship of American daytime television, into which it inserted soap ads.

Peterson says the current global economic situation will not affect the company as badly as others.

“We've done well during recessions as our products, though not always necessities, are basics. We have a broad portfolio product-wise and geographically. We are not recession-proof, but we've always been able to ride out hard times.” -

Source: Financial Mail

Published courtesy of