We won the assignment to launch Pampers into Venezuela for Procter & Gamble and it looked like a slam dunk.

Venezuela was a developing country at that time with an emerging middle class and an average age of about 17, so there were a lot of babies out there and lot more in production.  Plus, there was virtually no competition except old fashioned cloth diapers.  How could we miss?

Pampers had an amazing track record of successes in virtually every country where the product had been launched.  We had a budget for a multimedia introduction – print, radio and television.  A lot of thinking and a lot of preparation was needed.

We traveled to Cincinnati to be briefed on how Pampers had been introduced in other countries around the world.  Procter & Gamble had amazing statistics and information on what had worked for successful launches around the world.  While usage rates varied from a high in Japan to a low in Germany, we could fit Venezuela on the curve and had solid sales volume expectations.

We developed our strategy, positioning Pampers as providing babies with superior comfort.  This was because their little “pompis” would be kept drier and healthier because Pampers absorbency drew liquid away from their skin.

It was important not to emphasize the convenience to mothers, since mothers felt guilty in switching to a more convenient and less work intense alternative.  But mothers really understood the benefit of not having to clean dirty, poopy diapers every day.

Pampers already had some brand awareness since many Venezuelans bought them on their frequent trips to nearby Miami, a short 2 hour plane ride away and a favourite shopping destination.  Consumers regularly brought in cases of Pampers on their trips.

We launched with all cylinders pumping: TV, radio, print all doing their jobs.

Then a problem came up.  Pricing.  Product was priced based on importing product initially from the US before committing to local manufacturing.  To do so, P&G had to pay import duties on every box brought in to the country.

With the increase in demand from our launching Pampers, smugglers and the Venezuelan military took over the market.  They began immediately “importing” without paying duty.  With a significant savings from lack of tax and duties, their gray market product was easily undercutting the legally imported product.  In no time at all the entire market for P&G’s Pampers, sold legitimately dried up faster than a baby’s behind.  And P&G Venezuela was out of the business.

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