UPDATE: P&G Launching Online Store To Sell Key Brands
January 14 2010 - 3:31PM
Dow Jones News
Procter & Gamble Co. (PG), looking to ramp up its U.S. sales
in the face of retailer and consumer cutbacks, is launching an
online store that will sell key brands.
P&G's new "eStore" comes as traditional retailers have
reduced the variety of brands they carry and pushed their own
private-label products. P&G spokeswoman Tressie Long said the
company sees the new online store as more of a "learning lab,"
where it can study consumers' online buying habits, rather than as
a direct source of sales growth. P&G, which already sells its
products online through the Web sites of such retailers as Wal-Mart
Stores Inc. (WMT), says it will share what it learns with its other
retailers.
The eStore will start as a pilot using 5,000 consumers in coming
days. The site will carry only P&G products but will be owned
and operated by PFSweb, an e-commerce service provider. Product
prices on the site will be at the discretion of PFSweb, P&G
says.
Not every P&G product will be available via the site
initially, although big brands including Tide, Pampers and Olay
will be sold there. The new site--pgestore.com--is not yet publicly
accessible but will up for use in the spring. There will be a flat
$5 shipping fee for all orders.
Procter & Gamble has increasingly been looking for new
avenues of growth as consumers have cut back. In recent months the
company has pushed to sell more online, an avenue that has grown as
consumers turn to the convenience of the Internet to buy even daily
goods.
Despite P&G's push into the online medium, sales at
traditional retailers will remain key to its business. P&G gets
about half a billion in online sales, a fraction of its roughly $79
billion in annual sales. Researcher Nielsen estimates online sales
of consumer packaged goods including food, beverage, health and
beauty aids and household cleaners increased 20% to 25% between
2004 and 2008, hitting roughly $10 billion in 2008.
P&G shares recently rose 1 cent at $61.52.
-By Anjali Cordeiro, Dow Jones Newswires; 212-416-2200;
anjali.cordeiro@dowjones.com
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