P&G: Razing Rivals with Gillette? - best price oral b electric toothbrush

Robert Bernard 168-
History of P & G (PG)
To a large extent, it is a consumer product giant catering to women, selling brands such as Ivory soap, Cover Girl cosmetics and Olay skincare products.
With P & G today announcing the acquisition of Gillette for $57 billion (G)
P & G will also be the big men's beauty products.
P & G took control of the world's largest Gillette razor business.
In addition, it has obtained Gillette's Braun electric shaver division and right back antisweat series, which is stronger in men than P & G's deodorant products. Cincinnatti-
S. -based P & G is already the world's largest consumer goods company, with sales of $51 billion last fiscal year.
Gillette's sales are $9 billion, which will strengthen P & G's position in consolidating the retail industry, where powerful suppliers like Wal-MartMart (WMT)
In the order.
Deutsche Bank analyst William Schmitz said in a report that the deal "created a company that is unmatched in terms of geographical scope and competitive positioning ".
Gillette shares soared $5. 42, or 11. 86%, to $51.
P & G shares fell $1 at noon. 56, or 2. 8%, to $53. 76.
The deal marks Alan, CEO of P & G. G.
"Refuli's third major acquisition since becoming CEO in 2000 has led to a reversal of Kimberly Clark's competitors. KMB)to Colgate-Palmolive (CL)and Unilever (UN).
At that time, he bought Clairol and pushed P & G to a bigger market. margin hair-
Germany and Germany
Headquartered in Wella AG, will enter a higher areaend hair-care products (
See BW, 2/7/05, "Welcome to Procter & Gadget ").
But with his latest move, P & G is buying the most powerful consumer brand in the world ---
Gillette shaving business.
Gillette now has an amazing 72% in the United States. S.
Blade and razor market.
It is independent and has no strong no.
2. in the market, it is different from Cola (KO)and Pepsi (PEP).
In the first three quarters of 2004, sales of Gillette blades and razors increased by 11% to $3.
24 billion, while operating profit in the sector soared 13% to $1. 27 billion.
This accounts for 44% of the company's total sales and 68% of its operating profits, respectively.
Compared with other consumer goods companies, Gillette, such as P & G, has achieved unusual success in raising prices.
Gillette's M3Power battery Shaver last year is 50% higher than the previous model and now accounts for 35% of the U. S. S.
In terms of dollar sales, the razor market.
Therefore, the acquisition supports the strategy of Lafley to enter enterprises with higher profit margins such as beauty products and pharmaceutical products (
See BW Online 1/28/05, "Lafley on P & G gadget" evolution ").
The deal helped cope with the downward pressure on its profit margins, as it had to expand aggressively in the markets of developing countries
Price products to make progress.
As consumer goods companies compete with each other in crowded product categories that grow by about 3% a year, it offers new sources of sales growth.
It also gives P & G access to the store's male product Channel, a place that has never really been.
It can be said that its only real male brand is the introduction of Mr last year.
A car-
Cleaning system driven by hose.
Now P & G has the opportunity to extend some of the existing technologies of its existing brands to the Gillette brand.
For example, it can sell a male skin with Olay
Care series under the Gillette brand.
And P & G is generally negative.
In terms of deodorant led by its reliable brand, Gillette has more male customers.
The deal will also boost P & G's Crest oral-
The care business grew rapidly with the help of the acquisition of a low-growth SpinBrush in 2001
Price of electric toothbrush
But Gillette has more capabilities in the electric market. B line.
"Gillette is very competitive and probably the best electric brush in the world," Lafley said in a recent interview with BusinessWeek . ".
This will obviously put more pressure on competitors Colgate.
P & G and Gillette have held talks before.
Ironically, the negotiations led to the ouster of former Procter & Gamble CEO Durk Jager, when the company revealed that the giant was buying Gillette and two pharmaceutical companies.
At that time, P & G was more interested in Gillette's battery technology and its Duracell series.
This is one of the weaker departments in Gillette and may eventually be eliminated.
This time, P & G has taken a big step in the hope that Gillette's acquisition will enhance its position as the dominant consumer goods market.