Fairy and Herbal Essences push P&G turnover to $120m

Procter & Gamble Romania (P&G), the local division of the American consumer goods producer, logged more than $120 million revenues last year, general manager Matthew Price said. Turnover in 2002 was $112 million and profit reached $12.5 million. Consequently, sales were up about 7% in dollars in 2003, but down some 10% in euros.

P&G plans to boost advertising investments, launch new products and export more of the production of the facility in Timisoara to the former Yugoslavian states this year.

Price says 2003 was a year of overall consumption growth in Romania, as consumers started to prefer higher quality products.

“The Romanian consumers have become more educated about the supply available and are gradually giving up those cheap low quality products for brand-name products. At the same time, they are more receptive to new products released. One factor that caused the change in the consumer behaviour is the rapid development of the large surface store chains,” the Procter & Gamble official said.

He added P&G’s advertising investments had gone up more than 10% in 2003 compared with the year before.

The company was the biggest advertising spender on the Romanian market in 2002, as its gross (rate card) investments amounted to $66 million, according to the data released by market research company CSOP/Taylor Nelson Sofres. This means gross advertising investments were worth nearly $73 million in 2003.

“We set out to continue investing in the promotion of the products we launched and in introducing new products in 2004,” Price says.

A large part of the advertising spending in 2003 was directed to promoting the Herbal Essences shampoo launched in June last year and the Fairy dishwashing detergent released in late 2002. A few months after its launch, the product had already grabbed about 20% of the market, according to P&G’s estimates. Fairy competes with Pur (Henkel) and Axion (Colgate-Palmolive).

The statistics supplied by the company at the end of last year show P&G’s market share in Romania reaches over 40% for detergents (Ariel, Tide, Bonux), 40% for shampoos (Pantene, Wash & Go, Head & Shoulders), 60% for sanitary pads (Always) and diapers (Pampers).

Procter & Gamble’s main competitors in Romania are Colgate-Palmolive, Henkel and Unilever. Unilever South Central Europe (USCE) last year posted 138 million-euro turnover, of which 92 million euros in Romania.
georgiana.stavarache@zf.ro