What can we learn from P&G about selling online

So we have all heard that Procter & Gamble cut up to $140 Million in digital ad spending but here are some other interesting things (about how they see marketing online) that the company said in its quarter end conference call last week:

“…And we’ve talked often about endless shelf. If anything, online consumers look at less brands than more brands.

Walk a store at a big mass merchandiser, and some big categories like hair care you may say, 30, 40, 50 brands. When you go to any one of the online opportunity sources, you’ll probably look at page one, maybe page two.

And as I mentioned, strong brands often occupy the majority of page one and page two. So actually I think we’re well positioned. And brands that are meaningfully better and strong tend to do well. And our online business is actually growing well and growing well in both sales and share.

One of the things that I think is going to be critical to win online and it may be even more so, is the level of superiority. Because that then drives you to be getting both the discussion in social media as well as the movement that drives you up the various online companies’ algorithms…

If we can provide a differential benefit that’s much better than the next best, then I think we’re well positioned and maybe even better positioned online, because of the limited selection, because most people do by habit go to page one, page two…

Should P&G go direct-to-consumer?

And the question is, we are testing and have tested and will continue to test a number of models, including a company store, including working on a variety of things from working with our omni retailers and pure plays and everything in between.

But certainly our belief so far is that most consumers do not want to have a lot more accounts for narrow parts of their daily or monthly needs. And so an aggregator probably is better positioned to serve the consumer.

What we do want to do is have a superior product and a relationship with the consumer so that we can communicate with them appropriately…

What is the best way to communicate with consumers?

And so that’s beyond what I’d say traditional marketing of communicating the benefit of your brand. It’s having an equity and equity that matters. And each of our brands is thinking through what that looks like. And then finding the smart and appropriate way to communicate that to the consumer, when and where they’re receptive to the message, so that it’s less of an intrusion. It’s more giving them things that help them understand the brand and make informed choices. And that part I think is working well. The brands that do it best are the ones that are growing.

In-store execution is another area where we’re redefining excellence to a higher standard, growing categories and our brands. This requires the right trade coverage with the right product forms, sizes, and price points, and the right in-store shelving and merchandising execution.

The online shopping experience also demands executional excellence. On Amazon, Tide holds the top five search results for laundry detergent. Tide PODS are the number one best seller with over 2,000 reviews at an average rating of 4.5 points. The online execution includes video, strong performance claims, and strong value offerings for subscription options. On Walmart.com, Bounty is the number one search result for paper towels and the best seller behind strong brand content and superior performance communication…

The last element of superior execution, but certainly not the least, is winning consumer and customer value equations. Price is one element of a winning consumer value equation. But we’re really looking at the superior value of the total proposition. A product that meets a need in a noticeable and superior way with a package that is convenient to use with compelling communication, presented in a clear and shoppable way in-store.

As I mentioned earlier, we’re improving in-store execution with new approaches and technologies like image recognition and machine learning to obtain real-time data on store conditions to optimize our performance and coverage.

Digitization and machine learning are helping us improve the presence of our brands online. Understanding consumer behavior in areas such as digital search can help us spot important changes in trends that we can use to modify how we present our brands online.”

You can read the full transcript here.