The Origins of Product Management (part 1)

One of the common problems when discussing the subject of technology Product Management is that there is no common definition of Product Management that all people agree on.

To better understand what Product Management is, it’s important to understand where it came from.

The origins of Product Management go back to the 1930s at Procter and Gamble. Back then, a manager at P&G named Neil McElroy wrote what is now referred to as the “McElroy Memo”.  P&G was famous for their culture of writing memos on important topics.

McElroy was the manager responsible for Camay soap — a lesser brand to the company’s leading Ivory soap brand. Camay was not selling well and he decided that a dedicated “brand man” (and supporting team) was needed to ensure that sales of the brand were being maximized.  Here’s an excerpt from that memo describing some of the issues that the “brand man” would need to address.

1. Study carefully shipments of his brands by units.
2. Where brand development is heavy and where it is progressive, examine carefully the combination of effort that seems to be clicking and try to apply this same treatment to other territories that are comparable.
3. Where brand development is light:
   1. Keep whatever records are necessary, and make whatever field studies are necessary to determine whether the plan has produced the expected results.
   2. Study past advertising and promotional history of the brand: study the territory personality at first hand–both dealers and consumers–in order to find out the trouble.
   3. After uncovering our weakness, develop a plan that can be applied to this local sore spot. It is necessary, of course not simply to work out the plan but also to be sure that the amount of money proposed can be expected to produce results at a reasonable cost per case.
   4. Outline this plan in detail to the Division Manager under whose jurisdiction the weak territory is, Obtain his authority and support for the corrective action.
   5. Prepare sales help and all other necessary material for carrying out the plan. Pass it on to the districts. Work with salesmen while they are getting started. Follow through to the very finish to be sure that there is no letdown in sales operation of the plan.
4. Take full responsibility, not simply for criticizing individual pieces of printed word copy, but also for the general printed word plans for his brands.
5. Take full responsibility for all other advertising expenditures on his brands (author’s note – in-store displays and promotions).
6. Experiment with and recommend wrapper (author’s note – packaging) revisions.
7. See each District Manager a number of times a year to discuss with him any possible faults in our promotion plans for that territory.”

Putting aside the lack of gender neutral language (i.e. Study carefully shipments of his brands by units), here’s a summary of the 7 points:

1. Understand the regions and volumes of product being shipped.
2. For regions where sales are good or growing, understand why and try to apply those principles to other similar regions
3. Where sales are light, investigate the situation to understand the problems. Devise a plan to address the problems and work with internal parties to ensure the plan is successful.
4. Take charge for all messaging and advertising copy for the brands
5. Oversee advertising and marketing expenditures for the brands
6. Try new things, particularly with packaging of the brands
7. Work with local sales managers to understand their perspective on what is and isn’t working in their region

It’s an interesting list. In essence, the “brand man” is responsible for the business success of the brand (product or product family).

The role of “brand man” or “brand team” was very successful at P&G and was emulated throughout the consumer packaged good industry.  And, after almost 80 years, Brand Management is well defined and is a pure marketing and business function within Consumer Packaged Goods (CPG) companies.

The story doesn’t end here, but it’s clear that the principles of brand management had a significant role to play in the formation of technology product management.

Saeed

Related articles:

• The Origins of Product Management (part 2)
• The Origins of Product Management (part 3)