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Brand Management

Almost ninety years ago, the concept of brand management was born. Simply put, “branding” did not start with cows. It started with soap.

In 1925 Neil McElroy started working at Procter & Gamble as an ad department mail clerk. On May 13, 1931 he proposed the modern concept of “branding” and changed the future of the company and how brands and products were developed and marketed.

McElroy realized that P&G products largely competed with, well…, other P&G products. Recognizing the inefficiencies this presented, he drafted a three page, internal memorandum proposing a new business strategy called “brand management.” At the time, a three page document was significant in that all Procter & Gamble memos were restricted to a single page.

In the 20’s P&G largely sold soap and candles. These two commodities were in high demand. P&G sold what people needed and competed on price, quality and distribution. If it wasn’t for McElroy’s concept of “branding”, detergents may not exist today. Tide, the world’s first laundry detergent, was McElroy’s pet project and was the direct result of his desire to differentiate laundry soap from other, “general purpose” soaps.

Brand management would change the existing paradigm by focusing attention on product specialization and differentiation to distinguish the qualities of each brand from all other P&G brands. This provided each brand a unique advantage, as each would avoid competition with one another by targeting different consumer markets with a different set of benefits.

Championed by the company’s President/CEO, Richard R. Deupree, McElroy’s concept became the foundation of P&G’s business strategy.

So, we want to say “Thanks, Neil McElroy, for paving the way for such great product innovations and, of course, providing us with such a stimulating career path!”