May 17, 2011 > P&G sees less-fearful consumers
P&G sees less-fearful consumers
By Dan Sewell, AP Business Writer
CINCINNATI (AP), May 12 - Procter & Gamble sees less-fearful consumers choosing its big brands over store brands while higher-priced new products that pledge to do more are also selling well.
Chief Financial Officer Jon Moeller pointed Thursday to those signs of improvement from the recession at a Goldman Sachs analysts session in New York. But Moeller cautioned that developed markets such as the United States and western Europe continue to be sluggish.
``We're seeing consumers across all price tiers continuing to have a strong preference for branded products, which wasn't necessarily the case in the depths of the recession,'' said Moeller, adding that P&G is seeing market share gains against private-label products.
He said Crest 3D White toothpaste, Gillette Fusion ProGlide razors and new Old Spice men's toiletries have had strong sales.
``Some of the faster-moving items in our portfolio are these premium-priced items that we're launching with strong innovation behind them,'' Moeller said.
P&G has said it is raising prices on products including Pampers diapers, Iams pet food and Head & Shoulders shampoo, with most increases planned for this summer. Moeller said lower-tier consumers aren't as scared as during the recession, but P&G is keeping prices down on some brands such as Luvs diapers, which are priced below Pampers.
``They're not looking over the cliff into oblivion,'' he said of the consumers. ``The level of fear is much different.''
P&G's third-quarter earnings reported two weeks ago were just below Wall Street estimates. Jumping commodity and energy costs have led to price increases.
Moeller said the company is focusing on increasing productivity and cutting costs, such as rolling out compacted laundry detergents that take less packaging and use less energy to transport.
P&G shares were up 51 cents to $66.43 in midday trading. They have traded from $58.92 to $66.95 in the past year.