Content

1) Market Analysis
2) Situational Analysis
2.1: PESTEL
2.2: SWOT Analysis
2.3: Michael Porter’s Five Forces

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1) Market and Competitive Analysis

Our target segment age (4-8) constitute 19% of the total population, while the segment of age 0-
4 constitute only 10% of the total population. (Source: Ministry of health and population, July
2009).

As per the retail audit given out to us by AC Nielsen, the total tissue market was valued at EGP
667 M in 2009, with a growth rate of 5.2%. The growth rate was driven by wet wipes as the dry
tissues became stagnant and started losing market share to wet wipes by 2.6%.

Although the normal wet wipes is the biggest category 49% of the total wet wipes share the total
wet wipes started witnessing huge growth especially with the hygienic sub category that
represented almost 23% market share of the wet wipes market in 2009 but witnessed a major
increase of 40% from 2008 till 2009.

In the wet wipes category, the baby wipes are driven by family packs while the hygienic tissue
are driven by single servings to be convenient in carrying around.

The leader in baby wipes is our brand Pampers with a market share of 5%, while the leader in
hygienic wipes is Dettol with 6% market share, followed by Lifebuoy with 3% market share.

2.1) Situational Analysis

2.1.1) PESTEL

2.1.2) Political:

The ministry of health’s approval on our products enhances our credibility in consumers’
mind especially with a spokesperson from their end. While the ministry of foreign trade
facilities our exporting process to Africa, Europe and Asia

Such affiliations do not diminish the fact that the government encourages healthy
competition and competitors like Henkel, Unilever with their wide array of products in
personal and home care are a valid proof of that.

Even though Egyptian labor is cheaper compared to Europe and the United States, the
government highly imposes that no worker should work more than 8 hours with few
exceptions per month as agreed with the company, in addition to two days off per week
alongside the national holidays. Such labor laws are highly undertaken by P&G Egypt to
retain employees, attract new ones and maintain its reputation and image infront of the
government and its counterparts worldwide.

2.1.3) Economic:

We will be targeting children from 4 to 8 who decide upon their own products, but we will
be communicating to the mothers as well as the control 60% of the household spending
and are in total control of kids’ products purchase.

They believe in paying extra money for better quality and innovation especially when it
comes to their children’s hygiene. Even grandparents contribute to their children and
grandchildren’s pocket money and most importantly when it comes to essential and
innovative products with a competitive edge. According to Chris Ritchie a marketing
professional, good health care resulted in people living longer hence more disposable
income left for this older segment to spend on their children and grandchildren. Such

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scenario can be applied to Egypt as our AB grey market segment is prone to excellent
health and elderly care in well known private hospitals helping in enhancing their lives,
besides family bonds are unbreakable and giving out money is a sign of love and
generosity.

2.1.4) Socio-cultural:

Family bond is a tradition that Egyptian people embrace, no matter how family members
get carried away; they value family time, get together moments and ensuring health and
safety of one another.

Our AB segment constitutes 30% of the total Egyptian population. They hold high level
of education up to bachelor’s degree, plus many acquire an MBA and/or a PHD. They
speak 1-2 foreign languages; occupy top and middle management positions at
multinational, regional and local firms with an average salary of 15,00 EGP and 6,000
EGP as discretionary income. The average family size of this social class is 4-5 people
who mostly live in villas or big apartments in certain areas in major cities of Egypt,
besides owning summer houses by the Red Sea and Northern Coast.

AB children are admitted to international schools and acquire the same lifestyle of their
parents; however once they reach the age of 4 they are decision makers when it comes
to product purchase.

Product purchase frequency varies from one family to another. It can be on weekly basis
with foods and drink, bi-weekly for personal and home care products and finally on a
monthly level from hypermarkets where consumers buy their products in big stocks.

Mothers base their purchase decision on word of mouth, personal experience,

advertisement and lastly the price. As for kids their decision is firstly based on package
attractiveness then their own personal experience with the product.

Lately hygiene and health emerged as a secondary value especially within the AB
segment. With the spread of swine flu, pollution and other diseases amongst kids in their
schools this trend got wider and wider. As a result of such trend and awareness, many
companies started producing hygiene related products for the whole family but none
focused on children solely.

2.1.5) Technological:

P&G will have low barriers to entry when launching Kidissue since it already operates
on paper related products i.e. family care products like Pampers diapers and wet wipes
and Always.

P&G’s Research and Development’s team has always been up to date with the latest
consumer insights and need gaps; hence they develop what consumers really long for
and miss in the Egyptian market. Having said that P&G is always meticulous with their
product details especially the ones targeting infants and children; hence the safest yet
innovative technology is always used.

Advanced machines, with intensive labor training will be undertaken when producing
Kidissue. At P&G we use online systems that connect the factory with the warehouse

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 and distribution centers. In addition we will create a system connected to the key
accounts to track our sales.

The technology of various fragrance and children related shapes used in our product
development will give it a competitive advantage over the current tissues in the market.
And as Kotler and Armstrong once said “When old industries fought or ignored new
technologies, their business declined, thus marketers should watch the technological
environment closely” (Source: Kotler, Philip & Armstrong, Gary: Principles of
Marketing)

2.1.6) Environmental:

The government decided to educate environmental activists about the following: Firstly,
the inconvenience of recycling such products. Secondly, highlighting P&G’s ongoing
attempts in minimizing the use of papers from natural resources like trees through
adding some artificial paper like components provided by the government, and finally the
hiring local workers for those huge production lines. Such public announcement will put
the environmental activities to rest especially with the launch of our new paper product
Kidissue

We use the best filtering systems to minimize pollution as much as we could. Also being
an expert in paper productions like Pampers and Always educated us as P&G about
the dos and don’ts towards the environment

2.1.7) Legal:

We registered our name Kidissue after ensuring its unavailability and its absence of any
negative connotations in Egypt, Europe, Asia and Africa

On one hand, before launching Kidissue it passed through the Ministry of Health and
was thoroughly examined by XXX to ensure its safety on the short and long term on
infant’s and children’s skin and it will be communicated that the product should be
immediately stopped in case of irritation. On the other hand and as per the government’s
consumer protection law, a hotline number will be printed on Kidissue’s pack for any
suggestions and/or complaints. Besides that, P&G highly considers employee rights
through ensuring their safety in the work field and rights as P&G’s employees

2.2) SWOT Analysis:

2.2.1) Strengths:

As a company with a big investment capital, P&G will be able to pay for the technology
used in creating innovative wet wipes. Plus with 14 successful products in the market
under P&G’s reputable and trusted name, Kidissue will ring a bell of trust and
confidence upon its launch.

P&G is hands on an experienced marketing and management team in children’s

products. Those teams have been totally devoted to understanding children’s need and
wants from the kids’ perspective and their mothers’. They master identifying need gaps
to offer convenience, easiness and innovation to mother and child. Accordingly we

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became market leaders in baby diapers (Pampers) with a 12% market share. Also we
provide Pampers wet wipes for newly born up to 3 years with a 4% market share

Upon Kidissue’s launch, P&G will be the first to market /pioneer in thematic wet wipes
with innovative technology; those attributes are a competitive edge for the company
besides its reputable name.

Kidissue will have the advantage of being available in wide range of channels like
hypermarkets, supermarkets, pharmacies, schools, pediatrics, and children play/fun
zones. Our products will reach those places through strong the relationship we acquire
with the wide network of wholesalers and distributors.

2.2.2) Weaknesses:

Even if P&G is a reputable name and Kidissue is innovative, there might be a surplus
in our produced quantities, in case the product didn’t sell as planned.

Insufficient training for the labor on the new technology might reduce the product’s
quality and belittle its claim, causing mistrust. Also an inadequate training for our sales
representative might cause a misinterpretation or misuse of the product by our target
segment.

If our products are misplaced in the point of sales’ shelf or not visibly clear then we will
be labeled as plain and ordinary wet wipes which is not our scenario. To avoid such
error, we will be having attractive stand alone stands to place Kidissue and follow up to
assure visibility and implementation.

Finally managing over 60,000 supplier relations is costly especially when trying to
conduct it online and such might cause confusion or error in case of system break down.

2.2.3) Opportunities:

Given the company’s reputable and trusted name will increase the demand of key
accounts and other premium distribution channels to our new product. Besides that the
product is guaranteed to sell given its high innovation and the trust in P&G’s name.

Our main competitive advantage is how children from 4-8 will be attracted to our
thematic shapes and fragrance, encouraging them to use our wet wipes on their own
without mothers having to repeatedly asking them to clean themselves up. Such
scenario will surely grow demand for Kidissue

Our skilled and well trained employees are at a lower wages than many other countries,
hence facilitating exporting at a reasonable price across Africa, Europe and Asia.

In addition to that mothers would be curious to try our new product to sense the added
value and its effectiveness on their kids. Moreover, mothers trust any P&G product and
being the creator of Kidissue is to our benefit.

2.2.4) Threats:

Current key players like Johnson & Johnson and Dettol might launch the same
innovative product at a lower cost, since they are already experts in the tissue
manufacturing and creating a new product line will not be of high cost.

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 The shortage of artificial paper like product will harm our production line as we cannot
totally depend on natural resources to produce paper.

2.3) Michael Porter’s Five Forces Model

2.3.1) Competitive rivalry:

According to marketing research and retail audit findings, the total tissue market
recorded 5.2% growth in 2009 driven by wt wipes with 2.6% to reach EGP 667 M

We have the advantage of being a big reputable company, with huge production facilities
(economy of scale) and huge distribution facilities and direct contact with key accounts
(economies of scope).

Kidissue will be different from the current wet wipes. With its thematic shapes and
various fragrances, children from 4 to 8 will be encouraged to use them on their own
while in school, home or any other place without mothers having to ask them to.

Dry tissues are an indirect competition, however when we study our competitors in wet
wipes market, we have to dig deep down into their history, their current situation in the
market, what do they offer, to whom do they offer it, what kind of promotions do they
offer and when, and finally what future innovations could they be adding to their current
products or new ones? This case will ensure healthy competition and thriving to meet
consumers’ demands.

2.3.2) Bargaining power of suppliers:

P&G is expected to have high bargaining power over its suppliers due to reputable
name, heritage, and excellent payment terms.

There are plenty of suppliers for raw material and packaging since we have a large pool
of contacts used in Pampers diapers and wipes and Always. We are even supplied
with artificial paper like components from the government.

We are not expecting forward integration of any of those suppliers as the start up cost to
any of consumer goods markets would be high both for production and distribution.

2.3.3) Bargaining power of customers:

Consumers needs and wants change rapidly according to personal, social, culture and
psychological factors. We always need to be connected to our consumers through
marketing research: focus groups and customer surveys as an example. Consumers
hold a huge bargaining power so if we always need to trace their change and become
updated with their wants

Hence we are introducing Kidissue, a differentiated product with fragrance and thematic
shapes for children that was never launched before.

P&G is offering a differentiated product, reputable name, heritage and huge pool of
contacts. Buyers already trust P&G’s products from previous experiences in terms of
quality, availability, trust, innovations and extensive above and below the line support
plans.

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2.3.4) Threat of substitute products:

There is a relatively high threat of substitute products (plain tissues). Such threat can
emerge from our products’ unavailability and extra high price that needs to be addressed
when developing our marketing mix.

2.3.5) Threat of a new entrant:

Although the start up cost for production of such product like Kidissue and its
distribution is relatively high, new entrants’ threat should be highly considered. There are
competitors who might present the same product like Kidissue at a lower price or even a
better improved one. Such will be addressed by high loyalty programs that will occur
while developing our marketing mix.

References Used:

 http://www.pg.com/en_EG

 Kotler, Philip & Armstrong, Gary: Principles of Marketing

 Chris Ritchie: Fast Track To Success Marketing

(Source: www.pg.com/en_EG /company/history/growth.shtml)

(Source: Chris Ritchie: Fast Track To Success Marketing)

(Source: Kotler, Philip & Armstrong, Gary: Principles of Marketing)