Too many choices in 2007.
Faced with shrinking profits, Procter & Gamble is rethinking some of its products. The Wall Street Journal (sub req'd) reports that the company has "quietly rolled out" a cheaper version of its famous Tide detergent. Tide Basic costs about 20 percent less than regular Tide and is significantly cheaper than premium versions like "Tide Coldwater," "Tide with a Touch of Downy," or "Tide with Febreeze Freshness."
Procter & Gamble decided to go ahead with the product last January, but the Journal reports that it wasn't an easy decision:
Executives feared that a cheaper version might cannibalize sales of regular Tide, which accounts for more than $3 billion of P&G's $79 billion in annual revenues. Marketers at the company have been so loath to sully their prized soap brand that they've wrestled with the matter at least eight times in the past three decades.
On Wednesday, Procter & Gamble reported that its fourth quarter profit fell 18 percent and sales 11 percent. The company said the biggest hits came in the grooming and beauty sales divisions, which both saw sales decrease over 4 percent.
The future of Tide Basic is unsure, executives are waiting to see how it fares in about 100 stores throughout the South, but as for P&G, officials say they are testing lower-priced products in other areas as well.