P&G expands job cuts as part of new $10M cost-savings program
CINCINNATI — Procter & Gamble unveiled a larger than expected cost-savings program that involves cutting a total of 5,700 nonmanufacturing jobs in an effort to trim costs by the end of fiscal 2016, said P&G CEO Bob McDonald during the company’s annual Consumer Analyst Group of New York conference in Boca Raton, Fla.
According to published reports, the cuts represent about 10% of P&G’s nonmanufacturing jobs. P&G has about 57,000 nonmanufacturing employees among its total workforce of about 129,000.
The move is part of a new plan to cut costs by $10 billion through fiscal 2016. It includes $1 billion in marketing costs and $3 billion in overhead costs.
“To put the plan in perspective, it represents a huge 60% of fiscal 2012 operating profit. We doubt P&G can achieve this full target given such a large increase since its analyst day and low headcount savings contribution (~10%); but even if P&G slight misses its goals, the plan would provide much greater EPS flex,” Morgan Stanley analyst Dara Mohensian stated in a research note.
As reported by Drug Store News, P&G stated in its second-quarter earnings call in January that it would cut about 1,600 positions by the end of the fiscal year.
According to published reports, P&G said on Thursday it would cut another 4,100 jobs during fiscal 2013, which begins in July.
In addition, P&G reiterated underlying fiscal 2012 EPS guidance but officially lowered EPS from Pringles dilution, with fiscal 2012 EPS moving down by 7 cents to between $3.93 and $4.03, and the third quarter by 2 cents to between 89 cents and 95 cents.
Procter & Gamble is selling its Pringles potato chip business to Kellogg after a deal with Diamond Foods fell through.
PLMALive: Online advertising in favor of print opens door for store-brand messaging
NEW YORK — Online advertising is overtaking print advertising, according to a new video report by David Merrefield on PLMALive.
In 2011, spending on print advertising, which includes both newspapers and magazines, was $36 billion, topping the expenditure of online advertising at $32 billion. However, this year it is projected to reverse. Online advertising spending is likely to rise to $39.2 billion dollars while print is expected to drop under $33.8 billion, according to eMarketer.
"The change has strong implications for how private-label marketing will play out against branded-goods marketing in the future," Merrefield noted. "What’s fading is print media, long the domain of branded manufacturers."
Spending on television advertising, another medium dominated by branded advertising, has reached $80 billion and appears less impacted by Internet ad spending.
By 2016, online advertising expenditures are projected to be nearly double that for print.
The video report entitled, “Online Advertising: Boon for Store Brands,” can be accessed here.
Cetaphil develops new DermaControl line to battle acne-prone skin
FORT WORTH, Texas — The Cetaphil brand of cleansers and moisturizers has announced the launch of Cetaphil DermaControl products for acne-prone skin.
The line is comprised of Cetaphil DermaControl foam wash and DermaControl moisturizer SPF 30. It is positioned as the first skin care line of its kind designed to complement an acne regimen for sensitive, acne-prone skin.
The Cetaphil DermaControl foam wash uses zinc technology in a new generation surfactant cleanser to offer a breakthrough formulation with fewer preservatives to benefit the skin. The DermaControl foam wash’s oil-control formula is gentle enough to use with prescription acne treatments and leaves skin cleansed without stripping or drying, the company stated.
For patients undergoing prescription acne-treatments, using a product containing an SPF is vital. The DermaControl moisturizer SPF 30 features patented oleosome technology to provide broad-spectrum UV coverage and sun protection with fewer UV filtering chemicals. The moisturizer also utilizes micropearl technology to provide a mattefying effect, ceramide technology to help restore the barrier function and zinc technology, which has been associated with reduced surface oil and shine control for oily, acne-prone skin, the company stated.
The Cetaphi DermaControl foam wash has an average price of $10.99. The DermaControl moisturizer SPF 30 has an average price of $15.99. Both products are launching at retail in March. The Cetaphil DermaControl products are the second addition to the Cetaphil brand’s extension into disease-specific products. In 2010, Cetaphil launched Restoraderm to help manage the symptoms of eczema and atopic dermatitis.