Procter and Gamble has numerous competitors in various industries due to the wide range of products they produce. These industries include food, personal care, business services, commercial cleaning and facilities management services, consumer products manufacturing, and cleaning products.
For instance, Pringles is a product made by P&G. Its competitors include any chip products, such as Chipsy, a local Egyptian company, and other chips producers. Despite Chipsy only producing different variations of chips and P&G manufacturing various products, both companies are direct rivals. This benefits Chipsy, as they can concentrate solely on the production of one product, while P&G divides its resources and manufactures numerous unrelated products.
The example of Chipsy illustrates how some competitors prioritize perfecting one product, while P&G manufactures a variety of products without sacrificing quality. P&G consistently delivers exceptional quality across its diverse product range. Nevertheless, there are other competitors, like P&G, that operate in multiple industries simultaneously.
Unilever, a multinational corporation, faces competition in various product categories such as hygiene products and self-care. It encounters both local and global competitors in these markets. On the local level, Unilever competes with other companies targeting the same markets. Furthermore, it also faces competition from other multinational firms that aim to capture a portion of the local market.
In Egypt, the primary contenders include L’Oreal, Kimberly Clark, Henkel, Johnson and Johnson, sparkle and Oxi. These multinational rivals also compete in various countries, although not necessarily in Egypt. Procter and Gamble (P&G) holds the largest range of products within the household and personal care industry. They possess twenty-four unique billion-dollar brands and eighteen items with sales ranging from 500 million to 1 billion dollars. P&G generates revenues that are approximately forty-three percent higher than Unilever, its closest rival. Moreover, P&G maintains an operating income margin significantly superior to any of their competitors. The company’s main advantage lies in its innovation and continuous creation of new products while enhancing existing ones. P&G allocates over two billion dollars each year toward research and development expenses—nearly double Unilever’s investment of one point three billion dollars annually. This investment of over two billion dollars is almost equivalent to the combined investments made by all other major competitors except for Unilever.
This list includes Avon, Clorox Company, Colgate-Palmolive Company, Energizer Holdings, Henkel, Kimberly-Clark, L’Oreal, and Reckitt Benckisser. Clorox is a major competitor in the household cleaning products market. However, it is not a direct competitor to P&G as Clorox does not produce beauty products. Beauty products are one of the largest sectors that P&G deals with. Kimberly-Clark also competes in household products, but offers different items than Clorox.
Kimberly-Clark specializes in manufacturing various paper and tissue products including tissues, paper towels, diapers, and feminine products. Their notable products include huggies diapers, Kotex feminine products, Scott Paper Towels, and Kleenex tissues. These items directly compete with P&G’s offerings such as Pampers, Always, bounty, Charmin, and puffs. Colgate-Palmolive also produces similar products to those of P&G. In 2006, a significant portion of Colgate-Palmolive’s sales came from their oral care segment which encompasses toothpaste,
toothbrushes,mouth rinses,and other oral hygiene products.
P&G generates its primary revenue through the sale of various home care products, such as laundry detergent and cleaning products, and personal care items like soaps and shaving products. Additionally, P&G produces competing brands including Gillette, Camay, Olay, Safeguard, Zest soaps, Braun, Crest, and Oral-B dental products. Furthermore,P&G manufactures laundry detergents and cleaning products like Cheer,Bounce ,Downy ,Febreze air fresheners,and Tide.However,in the beauty product market competition,P&G only competes with L’Oreal.
L’Oreal specializes in producing beauty and cosmetics products, such as skincare, hair care, make-up, perfume, and other related items. In contrast, P&G competes in numerous markets, lacking the focused expertise of L’Oreal. This specialization enables L’Oreal to thoroughly explore the various facets of beauty and cosmetics products, leading to the discovery of exceptional products. Moreover, the beauty and cosmetics industry offers higher profit margins compared to several other industries where P&G competes.
L’Oreal and P&G are competitors in the same industry, but L’Oreal is more focused on it while P&G has products in various industries. L’Oreal expects high profits in this industry due to the high margins. P&G’s products in this industry include herbal essences, max-factor, Clairol, and Pantene. However, P&G also competes in other industries where high margins are not possible. Another competitor, Henkel, operates both internationally and locally. In Egypt, Henkel produces Pril and Persil, which compete with P&G’s cleaning and household care products. Pril is a dish soap while Persil is a laundry detergent.
Johnson & Johnson is a competitor that produces various brands such as band-aid, Tylenol, Neutrogena skin and beauty products, clean and clear facial wash, and Johnson and Johnson baby shampoo and conditioners (no tears). On the other hand, Arma is a company that mainly produces food products including oils and fats, as well as soap and detergent products, with Oxi detergent being their main product. Unlike Johnson & Johnson, Oxi is locally produced and only competes in the local market.
One product catering to the masses in Egypt is sold at a lower cost and targets lower income groups more concerned with affordability than brand names. Another competing product, Sparkle, offers hair oils and shampoo for normal and oily hair. Sparkle is also a locally produced and sold product aimed at the masses who prioritize affordability over quality or brand recognition. Unilever is P&G’s main competitor in both the Egyptian and global markets due to the similar nature of their businesses.
Both Unilever and P&G are diversified companies producing a wide range of products across different industries. Although they compete in most product categories, there are certain exclusive or more focused products for each company. Unilever’s main competing products with P&G include Omo detergent, Lux soap, Sunsilk hair products, rexona / sure deodorant, axe, and dove soap.
Unilever and P&G are major rivals in the market. While there are other competing products, they are not currently available in Egypt. It is important to note that certain companies sell the same brand under different names across countries. For instance, Unilever sells Persil in some countries while it is owned by Henkel in others.
Big multinational companies often adopt a strategy where they produce both a primary and secondary product in the same country. This approach can be observed in the detergent industry, with companies like Unilever and P&G marketing detergent products globally using different sub-brands to target specific markets. By doing so, these companies are able to present their products as varying in quality and image depending on the intended market or country.
The financial data for CLX and PG is available for 2008, while all other competitors’ data is from 2007. The table above demonstrates that P&G generates significantly higher revenues and net income compared to its main rivals. Furthermore, P&G invests considerably more in research and development than any of its competitors, including Unilever. In fact, P&G spends nearly twice as much on research and development compared to Unilever, with the combined spending of all other competitors (excluding Unilever) being similar to that of P&G.
My belief is that companies with higher revenues are not coincidentally those that spend more on research and development. Instead, I believe this spending leads to their success. The amount they dedicate to research and development reflects their willingness to invest in creating new products or improving existing ones to meet consumer requirements and preferences. This investment is crucial for ensuring product sales and innovating to keep up with constantly changing market demands influenced by technology and shifting consumer desires. Whether it’s due to product fatigue, new interests, or advancements in technology, consumers’ demands are always changing.
Essentially, the more a company invests in enhancing its products, the more it stands to gain. This aligns with the saying “you have to spend money to make money,” doesn’t it? Despite L’Oreal investing significantly in research and development relative to its revenues, it still falls considerably short compared to Unilever or P&G.
Another reason for the decrease in revenues is the difference in industries they compete in. L’Oreal is specifically focused on the beauty and cosmetics industry, while P&G competes in multiple industries. This gives P&G an advantage as a larger company with a wider variety of products. Additionally, P&G is not affected by changes in a single market. If spending decreases in one industry, the other industries can support it and ensure high revenues continue.
The size of the company is a reflection of its revenues. P&G is much larger than its competitors, including complete, partial, direct, and indirect ones. P&G believes its competitive advantage lies in its people, who cannot be imitated. They believe that by being inspired and working together, they are unstoppable. The level of “inspired performance” is seen as crucial to P&G’s ability to sustain consistent growth over time.
They invest in talented people and further develop them to allow them to reach their potential best. This helps the company sustain its reputation and continue growing in its markets. P&G believes that their main advantage over other companies is their actual manpower. Ultimately, the difference between products lies in how they are made, which depends mainly on who is making them.
P&G ensures that it hires individuals who enable them to continually innovate and improve their products to meet changing consumer and market demands. The aim is to anticipate the future needs of consumers, so that these products are readily available when the market is ready for them. The individuals responsible for this task must possess visionary thinking and creativity, as it is impossible to ask people about their future technology or product requirements when they have not yet recognized them.
P&G acknowledges the importance of creating innovative concepts that will be appreciated by consumers in the future. Their goal is to provide exceptional quality and valuable branded products and services, ultimately improving the lives of global consumers. Consequently, they strive for leadership in sales, profitability, and value generation from their customers, leading to prosperity for their employees, shareholders, and the communities they are involved with.
