P&G urges suppliers and retailers to end tug-of-war

ONE MORE THING:PROCTER & GAMBLE'S chief customer officer Bob Fregolle was in Dublin this week to address a conference.

In essence, his message was that suppliers and retailers need to work more closely to get through the recession and prevent the tug-of-war that often exists.

P&G’s stable of brands includes big names like Gillette, Oral-B, Pampers, Ariel and Duracell.

Most of these have been on promotion in Irish supermarkets since 2008 as retailers try to draw in cash-strapped shoppers.

Fregolle is not a fan of this practice. “In the short term, these promotions can trigger volume and sales. But long term, they tend to erode brand equities and loyalty, not just for suppliers but for retailers,” he told me.

Fregolle describes it as “shopper promiscuity” and said it would inevitably lead to less money being spent on “innovation” and product development.

“It’s a trade off.”

Fregolle paid a site visit to Dunnes Stores and met with Margaret and Anne Heffernan, and other senior executives.

How did he find dealing with them? “I loved it . . . we enjoyed their candidness,” the American said with a wry smile.

“There is no wondering about the agenda, which is good.”

He described Margaret Heffernan (left) as a “very accomplished professional” and “well schooled in the business”.

P&G is a significant employer in Ireland, with about 750 staff employed at manufacturing facilities in Nenagh (Max Factor) and Newbridge (Oral B) and in support functions in Dublin.

Most of the product is exported.

Fregolle said sales in Ireland rose by a single digit percentage last year and its market share increased, but there has been margin attrition.

“We’re cautiously optimistic that the future will be better for us than what we’ve got now.”