Spreading the Word about P&G

   Date:2012-01-12

Placing Christopher D. Hassall's age by his interests is no easy matter.

The 57-year-old loves anecdotes about China's last emperor, stories commonly seen in any retired worker's bedtime book collections. At the same time he listens to music favored by schoolboys struggling with their homework.

Hassall joined Procter & Gamble Co (P&G) as a toxicologist in 1983. The part-English, part-American is now the global external relations officer of the consumer goods giant whose products are used by seven out of every 10 Chinese in the world's most populated country.

"Although China is already a mature market for P&G, it will be one of the biggest sources of our new customers in the future," Hassall said.

At present, the Cincinnati-based Fortune 500 company has 10 manufacturing plants and approximately 1 billion customers across China.

However, the adage "dose makes the poison", the principle that all chemicals can be toxic if you eat, drink, or absorb too much of them, has not affected his attitude to the number of Chinese customers. When Hassall first visited China in late 2004, the country was the No 5 biggest market for P&G. Now it is the second-largest market, behind the United States.

Last year, two-thirds of P&G's revenue was generated from outside the US market.

"(P&G's market share in) China has grown tremendously during the past 23 years. It is also a very mature business with operations all over China," Hassall said.

P&G entered the Chinese mainland in 1988 by establishing the company's first-ever joint venture in its 174-year history.

But Hassall is eyeing the approximately 400 million Chinese people the company has not yet reached.

"There are many opportunities for P&G to drive its brands deeper into China's rural areas," he said. "We've expanded our reach by working with the distributors and sub-distributors to widen distribution in rural and remote areas."

According to a survey conducted by China Daily in October, more than 87 percent of the multinational executives said expansion in smaller Chinese cities and rural areas was "very urgent" or "important" to their businesses.

In June 2011, P&G announced that its anti-dandruff shampoo brand Head & Shoulders will be promoted in small cities in China in an effort to boost sales.

The move will pave the way for P&G to reach the 400 million untapped Chinese customers. The challenge, however, is making sure that P&G has the right infrastructure to make its products available in China's vast rural areas.

"As China's economy continues to grow, people want more premium products," Hassall said.

"We have to make sure that our products meet the needs of the very sophisticated, well-off urban consumers as well as the consumers in rural China who do not have much disposable income."

Hassall's understanding of China began when he was appointed general manager for external relations for China in 2005. Five years later P&G decided to launch an "external relations" function, a new branding and media relations department, which Hassall and his colleagues helped to create.

From 2005 to 2008, Hassall worked with Daniela Riccardi, then president of P&G Greater China, at the company's China headquarters in Guangzhou.

Speaking neither Mandarin or Cantonese, Hassall nonetheless found his collection of China-related books filling his shelves at his apartment in the southern city.

The number of such books has kept growing even though he now works in the US.

Hassall bought three books on his latest trip to China in October. One was about the life of overseas Chinese during the"cultural revolution" (1966-76); the second was a biography of Puyi, China's last emperor; the third gave a brief introduction to the 5,000-year history of the Middle Kingdom.

"I already know some stories about China's history, but I hope I could piece these fragments together with the help of this book," he said.

His favorite book is the translated version of Wolf Totem, a semi-autobiographical adventure novel comparing the cultural differences between Han and ethnic Mongolian nomads.

Hassall cannot match his childhood memories in Stoke-on-Trent, England, with the stories in Wolf Totem, but his experiences in North America, the Middle East, Africa and then China have probably helped him understand the nomadic part.

Hassall is a true traveler. He is no common backpacker but the 1.9 meter tall senior manager seems to enjoy his Up In The Air sort of job.

It was not an easy decision to leave his job as a research scientist and join the communications team, said Hassall, "One of the things I like about P&G is that you can have many different careers in different locations but still stay with the same company."

About seven years after Hassall joined P&G, he started to work on a number of projects that needed a scientist to communicate research findings.

He currently leads P&G's external relations activities worldwide including news media relations, brand publicity, consumer relations, employee communications, regulatory and technical relations, government and community relations, philanthropy and corporate reputation.

Hassall's research background has enabled him to talk to researchers in a very detailed way while using the simplest methods to introduce P&G's products when faced with people possessing zero knowledge about the industry.

In his 12-year career as relations manager he has not lost the spirit of a research scientist, maintaining a curiosity about the unknown.

Shortly after Hassall settled in his Guangzhou office in 2005, he found himself amazingly enthusiastic about Jay Chou, a Taiwan pop star whose fans are predominantly Chinese with an average age younger than 30.

"I find Jay Chou's music very creative and very approachable," Hassall said, adding that he went twice to Chou's concerts when he worked in China.

He even once lip-synched Chou's song, Ben Cao Gang Mu at the company's New Year party.

He is aware the title of the song comes from an ancient Chinese compound of medical herbs, which makes for a nice connection between work and pleasure for the veteran toxicologist.

On Oct 27, 2011, P&G reported a 1.9-percent net income decline in the July to September quarter. Net income in the fiscal period ending Sept 30 fell to $3.02 billion from $3.08 billion a year earlier, according to a company statement.

Analysts believe the increasing costs of raw materials is the main reason hindering P&G's growth and sales gains in emerging markets.

"The cost of doing business has gone up - higher competition, more difficult consumers, more demanding retailers, tougher to market," Bloomberg News quoted Sanford C. Bernstein & Co's analyst Ali Dibadj as saying. He gave an "outperform" rating on P&G's shares.

However, total sales of P&G jumped 8.9 percent to $21.9 billion, beating previous estimations.

"The (profit) growth in developing regions is faster than it is in developed markets," said Hassall.

In the first half of 2011, both P&G and Unilever PLC announced a 15 percent price-hike plan on sales of detergent and soap in China in an effort to cope with the soaring inflation rate. Chinese authorities fined Unilever 2 million yuan ($315,000) for "disturbing the market pricing system".

It is important for companies to reduce costs, especially in such a bad economic environment. One of the methods P&G used was to upgrade its research and development team and make its products more competitive in the market.

"When we develop products which are more sustainable, one of the critical facts is that we do not trade off against the performance of the product," Hassall said.

P&G does not expect consumers to pay more for sustainable products. "Many consumers are not aware that they are buying a sustainable product," he said.

Hassall believes what China is pursuing more energy-efficiency targets than any other part of the world.

China plans to cut energy consumption for every 10,000 yuan of gross domestic product by 16 percent by 2015.

"It's very important that a product uses less energy, less packaging, less material - which is sustainable - but the consumers do not end up with a decrease in the performance of the product," he said.

He gave an example of Tide Coldwater, P&G's laundry powder for washing using cold water.

"It's not more expensive. In fact the consumers save money because they spend less money on energy in heating water. But we have to educate consumers so they know that it works just as well as products that use hot water," he said.

"It's not putting additional costs on consumers."

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