Monday, July 23, 2012

The eternal battle between Procter & Gamble and Unilever is intensifying in the developing world

Some interesting perspective from The Economist on the 'eternal' battle between Procter & Gamble and Unilever... A must-read if you are interested in the dynamics of FMCG business on a multi-national scale.

"The sense that Unilever is on the up, whereas P&G is in trouble, is the latest swing of a pendulum that only five years ago saw Unilever struggling as P&G soared. The slow economic recovery in America and the deteriorating economic situation in Europe have hit P&G harder, because it earns a greater share of its revenues in those developed markets and its brands tend to be more expensive than Unilever's—and thus more likely to be sacrificed by consumers who are being forced to count the pennies.

Mr McDonald's promise to make P&G's pricing more competitive, and his plan to cut costs by $10 billion, could, if delivered, help to restore P&G's fortunes in these markets at the expense of Unilever and other consumer-goods firms. But the biggest questions concern how P&G can improve its performance in the developing economies on which both it and Unilever depend for long-term growth."

Read the full article here.

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