By Cliff Peale
The Cincinnati Enquirer
It's a simple decision for Carolyn Schwettman: Pampers over Huggies.
The reason - 2 1/2-year-old daughter Anna - sat on Schwettman's arm as the mother of twins approached the Hyde Park Plaza Thriftway store last week.
"I just like the quality better," she said. "And this one likes them because they have Grover and Elmo on them."
Similar split-second decisions, when multiplied by millions of consumers daily, mean major dollars in the corporate coffers of Kimberly-Clark Corp. and Procter & Gamble Co., the respective makers of Huggies and Pampers.
The battles between P&G and its competitors have gotten nastier in recent years, as the companies try to protect their own sales while stealing market share.
In this corner...
Kimberly-Clark Corp.: A giant in the baby-care business, Kimberly-Clark makes Huggies, Pull-Ups and Depends. It also markets the Kotex feminine-care brand and Kleenex tissues.
Colgate-Palmolive Co.: Toothpaste is the main driver for this global powerhouse. Besides the signature Colgate oral care and Palmolive dish-care brands, it also makes Hills pet food and Speed Stick deodorant.
Playtex Products Co.: This company is focused mainly on feminine care, particularly its signature tampon product. Other brand names include Banana Boat sun and skin care.
Procter & Gamble Co.: The Cincinnati-based firm competes across dozens of categories, with four core ones where it makes signature brands: laundry detergent (Tide), diapers (Pampers), hair care (Pantene and Head & Shoulders) and feminine care (Always and Tampax).
Whether the product is tooth whiteners or diapers or tampons, commercials have gotten more direct, with companies belittling rivals and boosting their brands.
"In today's world of ad clutter, you've got to really spell it out," said Chris Allen, a University of Cincinnati marketing professor who has helped work with P&G's marketing training programs. "They (P&G) no longer can take for granted that they're the dominant player. So they've got to take the gloves off."
The harsher competition has even led into court. Earlier this year, a New York jury ordered P&G to pay $2.96 million to rival Playtex Products Inc. for making false claims in ads and to stop calling its Tampax Pearl tampon "superior."
Since P&G is so big, the battle for customers is global. Its competitors include many of the world's premier corporate names, from Unilever to L'Oreal to Clorox Corp.
Yet the battle has direct consequences for people in Cincinnati. It eventually is reflected in P&G's corporate earnings, its stock price and the thousands of jobs the company supports in its hometown.
Price is main factor
P&G may be a major employer here, but for some shoppers at the Thriftway in Hyde Park Plaza on Wednesday, that wasn't usually the determining factor when they chose a brand. Price was what drove their choices. (They added that commercials don't usually affect what they buy, despite the millions that P&G and its rivals spend on them.)
Some shoppers said they have developed a loyalty to one brand, be it Colgate toothpaste or Pampers.
"I just stick with Colgate," Josephine O'Neal of Evanston said. "I think I used Crest a couple of times, but I just like the taste."
She said she tried Crest a couple of times when she had a coupon, but "the only reason I would change is if I liked the taste."
Pam Kaiser of Hyde Park was shopping with her 2-month-old son, Jackson. She said she usually buys Huggies, even though she has participated in Pampers tests here with P&G.
"I buy whichever one I have a coupon for," she said. "I would go with whichever one is cheaper."
With P&G marketing about 250 brands and facing competitors large and small all over the world, the weapons it uses in its battles range from prices to coupons to in-store displays to traditional 30-second TV commercials.
It's a fact of life in corporate America, with companies firing off letters complaining about ads or other tactics. P&G leaders insist that they don't focus on that competition, but instead on the consumer who uses the product.
But P&G brand leaders do research both their products and competitors to develop claims, then run them by regulatory and legal personnel. They also watch competitors to develop promotional and coupon strategies to specific audiences. For example, Pampers can send coupons to a list of millions of new or expecting mothers.
Crucial fights for P&G
Several brand battles have stood out in the last year. They include:
Crest versus Colgate - Crest was first to the market in May 2001 for tooth-whitening products with Crest Whitestrips, and rival Colgate-Palmolive responded with a paint-on version, Simply White.
Crest responded with a commercial lampooning Simply White, with a woman unable to talk because she had just applied the paint-on whitener. Colgate complained first to P&G, then to the National Advertising Division of the Council of Better Business Bureaus, which ruled in May that P&G had "unfairly and falsely denigrated Colgate's Simply White" and should change some of the wording in the ads.
"They were not happy," said Ayman Ismail, marketing director for oral care at P&G. "Both of us are respected companies that don't want to put lies out there. ... In my own mind, what's driving me is to inform the consumer of the truth."
Since then, Crest has unveiled its own paint-on product called Night Effects and now claims to have 60 percent of a home-whitening market that is $600 million and growing.
Pampers versus Huggies - P&G's biggest diaper innovation in several years hit North American stores last year, with lines called Swaddlers, Cruisers and Easy Ups. Kimberly-Clark, which has beat P&G to the training-pant market with Pull-Ups, has introduced a multistage product in some markets, but has not slowed the Pampers momentum much.
That has intensified the long-running competition between the two diaper-makers, with P&G boosting its U.S. market share 4 points in the year ending in July, and both Kimberly-Clark and private-label brands losing share, said Deb Henretta, president of global baby care at P&G.
"The reality of the diaper business is that we're facing a formidable competitor in Kimberly-Clark, and this is going to be a highly competitive category," she said. "We're forced to really try to win with innovation in the marketplace."
Tampax versus Playtex - After years of not having a plastic-applicator tampon, P&G introduced Pearl a year ago.
But its ads infuriated Playtex, led by CEO Michael Gallagher, who had started his career at P&G. He labeled the P&G ads "shameful" and Playtex filed suit for misleading ads. After the verdict, P&G agreed to stop the claims. There is another suit pending, with Playtex claiming that Tampax Pearl violated its patent.
Melanie Healey, general manager for P&G's North American feminine care unit, said P&G continued to stand by its research. She said Tampax Pearl had built a 12.8 percent market share from scratch in a year. While it still trails Playtex in the plastic applicator category, Tampax's market share remains roughly twice Playtex's.
"We know when women try this product, they love it," Healey said.
"I don't know what's going on in their (Playtex's) mind," she added. "We're obviously focused on doing what's right, and telling the consumer what our innovation is all about."
P&G's results - including increasing its quarterly earnings estimates last week - show that it's winning more battles than it's losing. Wall Street will be watching to see if that continues.
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