Procter & Gamble (
) competes with
), Clorox (
), and Colgate-Palmolive (
) in the fabric care market. Despite fierce competition, we believe
P&G will be able to push its share higher with its focus on
developing markets and "green" products initiatives.
P&G's market share in the fabric care business has grown
over the past few years led by global acquisitions, aggressive
marketing and constant product innovation. P&G's global laundry
market share is around 31%. Under its fabric care business, P&G
sells laundry detergent products like Tide, Gain and Ariel - each
brand contributing above $1 billion in annual sales - as well as
fabric softeners like Bounce and Downy, and bleach products.
While we believe P&G share in the global laundry market will
increase towards 33% by the end of our forecast period, Trefis
community members predict that P&G's share will approach
We maintain a price estimate of
for Procter & Gamble's stock.
Emerging Markets Key to P&G's Growth
P&G is a market leader in developed markets like the
U.S., Western Europe and Japan. However, these markets are
competitive and have limited growth potential due to saturated
consumer demand and relatively lower population growth rates. The
economies in emerging nations like Brazil, India and China are
rising with higher population rates and rising income levels of
middle class families.
In a recent press release related to Q2 earnings, P&G said
that its household care volumes, which includes fabric care and
home care, increased by double digits in developing regions and
mid-single digits in developed regions. The company also commented
that fabric care volume was up by mid-single digits due to market
growth in developed regions, as well as an increase in the
company's market share due to strategic initiatives.
Innovative and Greener Products
P&G is focusing on eco-friendly laundry products that reduce
the consumption of water for washing clothes. Demand for
specialized fragrances have also caught up with consumers. P&G
has introduced several laundry care products with its Febreze
brand, which originated as an odor-control product. Demand for
fabric softeners are growing as fast as laundry detergents. Fabric
softeners are mainly used for protecting delicate garments from
heavy wash loads as well as protecting garment color.
See our full analysis and $83.81 price
estimate for Procter & Gamble
Trefis Community Forecast
Trefis community members anticipate that P&G's global market
share for laundry products will increase from 32% in 2009 to nearly
38% by the end of our forecast period, compared to the baseline
Trefis estimate of an increase towards 33% during the same period.
The member estimates imply a small upside to our
price estimate for Procter & Gamble's stock.