Saatchi & Saatchi has won the multi-million pound task of launching
Procter & Gamble into the global petfood market.
P&G bought Iams, the specialist petfood manufacturer, for pounds 1.4
billion last month - the biggest acquisition in the company’s history.
It is understood that it plans to turn the company’s two main brands,
Iams and Eukanuba, into mass-market products by expanding distribution
into supermarkets for the first time.
In the UK, this will present a serious threat to the two established
players, Pedigree/Mars and Spillers. Pedigree has 34 per cent of the
dogfood market and 37 per cent of catfood, and Spillers has 42 per cent
and 21 per cent of those markets respectively.
The worldwide account is being handled out of Saatchis’ New York office
with London co-ordinating all European advertising. The account, which
billed dollars 15 million, was previously handled by W. B. Doner.
’We are delighted to partner with Saatchi & Saatchi to further build the
equity and global presence of these brands,’ said Jeffrey Ansell,
president of Iams, who added: ’Saatchis’ capability and strong track
record in helping build P&G brands make this an excellent choice.’
Saatchis will also be responsible for handling relationship marketing,
PR and interactive work for the brands in 77 countries.
E-commerce is expected to play an important role in P&G’s distribution
plans, with links to the increasingly popular pet sites such as Pets.com
Although P&G’s decision to enter the petfood sector initially surprised
analysts, it has since been recognised as a smart move into a market
worth pounds 15 billion worldwide.
Iams and Eukanuba are brand leaders in the US premium sector, which
accounts for 10 per cent of the whole market. They also specialise in
dried petfoods, a strong growth area. However, P&G is expected to
concentrate its marketing muscle outside the US, which accounts for two
thirds of the premium petfood market.
This would seriously shake up the UK market, which for years has existed
as a virtual duopoly. According to MMS figures, Pedigree spent more than
pounds 25 million on advertising last year - a sum P&G will have to more
than match to make inroads in the sector.