Procter and Gamble’s Sales Report Reveals “Extreme Couponing” is Back

Procter & Gamble, the Cincinnati giant behind household staples like Tide, Pampers, and Dawn, just got served a bitter pill that’s harder to stomach than the price of their own premium products. 

With inflation eating away at everyone's wallets and the U.S. economy about as stable as your aunt’s third marriage (you know, the one that involved a Vegas chapel and an Elvis impersonator), consumers, especially from lower-income groups, are abandoning P&G products and opting for cheaper alternatives. 

(Hey, we’ve all considered those suspiciously affordable store-brand products at least once.) And if that wasn’t enough, P&G is also getting sideswiped by dying demand in China, where rivals like Nestle and Unilever are dominating.

This morning,  P&G reported that their first-quarter net sales dipped by 0.6%, landing at $21.74 billion. That’s the second straight quarter of declining sales, a streak no company likes to brag about. Sure, they managed to eek out a 1% increase in overall organic volumes, but given the price hikes across the board, it’s like slapping a fresh coat of paint on a crumbling house. It might look better on the surface, but the foundation is still gonna collapse, and everyone knows it.

And P&G’s skincare line? Well, their high-end SK-II brand saw organic sales drop by 20%. Why? An anemic Chinese economy and rising anti-Japan sentiment. Meanwhile, their grooming, fabric, and home care divisions are trying to carry the team, but it’s like bringing a butter knife to a sword fight.

Back in the U.S., consumers are out here acting like they’ve got an honorary PhD in extreme couponing. Private-label brands and discounted products are flying off shelves faster than Bounty ever could. (And let’s be real, who isn’t tempted by a $1 difference when the account balance is running low?).

But don’t expect P&G to start lowering prices to compete. According to CFO Andre Schulten, “There’s no desire on our side, and I don’t think there’s any pressure from consumers to adjust pricing.” They believe that people will still fork over the cash for their premium products (because let’s face it, nobody wants their clothes smelling like off-brand detergent).

P&G’s quarterly profit took a 12% crap from the previous year, down to $4 billion. While they’re optimistically sticking to their forecast of 2-4% sales growth for the year and earnings per share in the $6.91 to $7.05 range, competitors like Nestlé are already gearing up for more promotions and discounts to stay alive.

In the end, P&G’s strategy boils down to this: stay premium, stay proud, and cross your fingers that people still care about quality over a good deal. But if these trends keep rolling, even the most die-hard Tide fans might start questioning if that $5 detergent is really worth the extra cash (especially when the store-brand stuff gets the job done for half the price).

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Stock.News has positions in Procter and Gamble.