Analysis from Euromonitor

Brand divestment and new CEO signal P&G’s focus shift away from Beauty

By Andrew MCDOUGALL contact

- Last updated on GMT

Brand divestment and new CEO signal P&G’s focus shift away from Beauty

Related tags: Investment, Euromonitor

It has been a busy time for Procter & Gamble with the brand divestment to Coty and the announcement of its new CEO and this all acts as evidence that the company is shifting its focus away from Beauty, according to market research firm Euromonitor International.

Earlier this month it was announced that Coty was to merge 43 of P&G’s colour cosmetics, fragrance, and hair care brands in a deal worth $12.5 billion​; and then earlier this week the Ohio-based firm also announced that the firm’s current Beauty chief David S. Taylor would be taking up the reins as company CEO in November​.

According to Euromonitor, this signals that P&G’s focus is currently shifting away from Beauty to focus on other key markets such as Home Care, as it looks to put a new long term strategy in place.

‘Clear evidence’ of focus shift

Ian Bell, Head of Home Care at Euromonitor says the new appointment in particular is clear evidence of this as the company looks to rationalise in a move that is common for a manufacturer that is involved in multiple industries and focus on a buoyant home care industry.

“P&G along with a few other major manufacturers who cover multiple industries are looking to cut some exposure to beauty and personal care and focus more on other industries, home care one such example but you can also add baby care as well to the P&G story,”​ he tells CosmeticsDesign-Europe.com.

“The direction they’re heading to will be a more streamlined, more focused and more international (developing markets) focused company which will likely see a closer relationship with appliance makers in the coming years at least in the developed markets.”

Bell adds that this is all connected to the company’s attention to divest and believes it is unlikely that P&G is finished with that particular strategy.

Beauty not done yet though…

Beauty and Personal Care Analyst, Oru Mohiuddin, agrees with Bell; however she also believes that the consumer goods firm is not completely done with Beauty as it has not sold all of its brands, suggesting there could be a return or refocus in the future.

​[P&G is] coming out of beauty and which by default means home care is key focus. However, their presence in beauty still has some gaps i.e. premium skin care to take advantage of the full potential of the category,”​ she tells us.

“It is unlikely, a company of P&G magnitude would remain content just being in home care. If they wanted to just focus on home care they would sell skin care too, which they didn’t. I expect them to make a push in the future in beauty but in areas in which they stand to benefit from greater synergy.” 

Related topics: Business & Financial

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