Table A Sizes of Dishwashing Liquid Used in Past Seven Days 48 oz. 32 oz. 22 oz. 12 oz.

% Respondents Source: Company research.

13%

30%

42%

15%

Table B U.S. LDL Market Influences 1960 LDL Household Penetration ADW Household Penetration Total Households (millions) a Company estimates 1970 1980 1990a

53% 5% 53

83% 18% 63

90% 36% 79

92% 44% 91

Table C Ivory, Dawn and Joy Pricing Manufacturers Size Items/Case Carload Case Price Carlo ad Item Price $2.53 1.77 1.2 $0.67 Avera ge Retail Price $2.99 2.04 1.46 $0.84

48 oz. 32 oz. 22 oz. 12 oz.

9 12 16 24

$22.77 21.24 19.2 $16.08

Exhibit 1 Consolidated Statement of Earnings ($ in millions except per share amounts) Fiscal Year Ending June 30 1981 Income Net sales Interest and other income Costs and expenses Cost of products sold Marketing, administrative, and other expenses Interest expense $11,416 83 11,499 1980 $10,772 52 10,824

7,854 2,361

7,471 2,178

98 10,313

97 9,746 1,078

Earnings from operations before income taxes Income taxes Net earnings from operations Extraordinary charge: costs associated with the suspension of sale of Rely tampons (less applicable tax relief of $58) Net earnings Per common share Net earnings from operations

1,186

518 668

438 640

-75 $593

$640

$8.08

$7.74

Extraordinary charge Net earnings Average shares outstanding 198082,659 ,861 Dividends Source: Company records

-0.91 $7.17

$7.74

$3.80

$3.40

Exhibit 6
LDL Market Historic Growth Trends and Projections

Fiscal Year Ending June 30

Volume (millions cases)

% of Category Volume
Mildness Performance Price

A. Actual 1973 1974 1975 1976 1977 1978 1979 1980 1981 B. Projected 1982 1983 1984 1985 1986 56.4 57 56.4 56.8 56.1 57.8 57 58.7 59 44% 45 44 43 40 40 39 38 37% 19% 20 21 22 28 30 32 33 35% 37% 35 35 35 32 30 29 29 28%

59.4 59.8 60.1 60.8 61.1

37% 36 36 35 35%

35% 35 35 36 36%

28% 29 29 29 29%

Exhibit 7 Attribute Importance Ratings

% of Res Attribute a* Makes dishes shine Pleasant odor or perfume Dont have to use much Doesnt make skin rough Is low-priced Good for hand-washing laundry Does a good job on pots and pans Does not spot or streak glasses or dishes Is mild to hands Makes long-lasting suds Cuts grease Is economical to use Soaks off baked-on or burnt-on food Good for tough cleaning jobs Source: Company research 6 64% 40 70 65 50 29 75 67 68 83 87 72 60 52% 5 16% 17 13 12 19 14 13 15 13 12 6 13 17 13%

a* Respondents were asked to rate the importance to them of LDL attributes on a 6-point scale, with 6 being want To be read, for example: 64% of respondents claimed Makes dishes shine as one of the attributes they wanted m of respondents claimed this attribute as the one they wanted least.

Ratings
% of Respondents 4 7% 11 6 7 10 9 4 8 5 7 2 6 7 8% 3 6% 10 5 5 9 11 2 3 5 2 1 4 5 9% 2 2% 7 1 4 3 9 1 2 3 2 1 2 4% 1 2% 10 2 3 4 23 1 2 3 2 1 1 4 9% No Answer 3% 5 3 4 5 5 4 3 3 2 3 3 5 5% Average Rating 5.30% 4.2 5.5 5 5 3.7 5.6 5.4 5.2 5.5 5.8 5.5 5.2 4.80%

oint scale, with 6 being want the most and 1 being want the least. the attributes they wanted most in a dishwashing liquid, while 2%

Exhibit 8 LDL Market Shares by Brand and Company (shares of statistical cases) Share of Market Brand P&G Joy Ivory Dawn Thrill a* Lever Brothers Lux Dove Sunlight All others Colgate-Palmolive Palmolive Liquid Dermassage All others All other LDLs Total LDLs Segment 1961

Performance Mildness Performance Mildness/performance

14.90% 17.5 32.4 17.3 5.9 23.2 5.5 5. 5 38.9 100.00%

Mildness Mildness Performance Price

Mildness Mildness Price/performance Mainly price/generics and private labels

Source: Company records a* Thrill was introduced by P&G in 1969. The brand ultimately proved not to provide a needed product benefit and discontinued in 1975 because of faltering volume.

statistical cases) Share of Market 1971

1981

12.00% 14.9 2.9 29.8 7.3 4.8 1 13.1 11.7 9.6 21.3 35.8 100.00%

12.1 15.5 14.1 41.7 3.1 3.1 0.7 6.9 11.8 3.5 8. 3 23.6 27.8 100.00%

e a needed product benefit and was

Exhibit 9 Cost Structure for an Established LDL Brand Cost of goods Distribution Selling and general administration Marketing expenditures Profit Total 51% 7 10 20 * 12 100%

Source: Company records * Includes advertising, trade and consumer promotion expenditures.

Exhibit 10 LDL User/Non-User Attribute Association (%) Usual Brand * Joy Dawn Yes No Yes No 53% 12% 41% 7% 78 14 88 15 49 7 96 45 55 10 88 28 81 45 59 5 60 4 65 6 60 10 67 11 64% 35% 39% 9%

Attribute Best for mildness Best overall for getting dishes clean Best for cutting grease Best for removing tough, cooked-on foods Best for leaving dishes shiny Gives the best value for your money Makes the longest-lasting suds Has the most pleasant fragrance Source: Company research

Ivory Liquid Yes No 89% 51% 64 9 41 6 47 7 44 10 74 24 79 29 43% 11%

Note: Respondents were asked to indicate which one brand was best described by each attribute phrase. To be read, for example: 89% of respondents who claimed Ivory Liquid as their usual brand indicated that it was best for being mild to your hands; 51 % of people who did not claim Ivory Liquid as their usual brand indicated it was best for being mild to your hands. * A brand user was defined as a respondent who reported that brand as the usual brand used over the

%)

ual Brand * Palmolive Yes No 71% 27% 61 5 35 4 41 6 40 4 55 5 50 5 35% 11%

Price Brands Yes No 13% 2% 18 1 16 1 19 2 14 1 40 7 12 1 14% 1%

y each attribute s their usual brand t claim Ivory Liquid as

brand used over the

Exhibit 14 Current Product Usage (%) Ivory Joy Dawn 23% 13% 25% 35 30 29 58% 43% 54%

Usual brand Past 12-month trial Ever tried

Source: Company research Note: An estimated 60%80% of total brand volume was consumed by usual brand users for each brand.

and users for each brand.

Exhibit 16 Shipment and Share Data for LDL Brands

Factory Shipments (millions of cases) Market Share (% of LDL category)

Ivory Dawn Actual 1977 1978 1979 1980 1981 Estimated 1982 1983 1984 1985 1986 9.1 9 9.1 9.1 9.1 6.7 7.3 7.5 8.2 8.3

Joy 6.7 6.7 6.8 6.9 7.1

Ivory 16.30% 15.5 16 15.5 15.50%

Dawn 11.90% 12.7 13.2 14 14.10%

Joy 11.90% 11.6 12 11.7 12.10%

9.2 9.3 9.3 9.4 9.5

8.7 9 9.3 9.7 10.1

7.2 7.4 7.5 7.6 7.8

15.50% 15.5 15.5 15.5 15.50%

14.70% 15 15.5 15.9 16.50%

12.20% 12.3 12.4 12.5 12.70%

Source: Company records Note: Projections are based on each brand managers judgment.

Exhibit 17 LDL-User Demographic Profile (% of total responding households) Usual Brand Total LDL Households ADW UsagePast 7 Days Yes 36% No 64 Yearly Income Under $15,000 32 $15,00025,000 27 Over $25,000 41 No Name/ Users * Liquid Joy Dawn Palmoli Plain ve Label 9% 90 48% 51 49% 51 51% 49 48% 42 47% 53 Heavy LDL Ivory

46 29 25

28 27 45

32 26 42

35 29 36

30 27 43

36 29 35

Population Density (000/sq. Under 50 32 501,999 45 2,000 and over 23 Geographic Area Northeast North Central South West Employment** Employed Not employed Age*** Under 35 3550 5159 60+ Number in Family 12 34 5+

39 40 21

30 45 25

33 44 23

38 43 19

28 46 26

20 48 32

22 28 33 17

26 28 35 11

22 26 34 18

23 27 37 13

19 31 35 15

24 27 33 16

36 31 16 17

48 52

37 63

48 52

50 59

49 51

49 51

55 45

33 30 16 21

39 25 15 30c

31 29 17 23

34 31 16 19

38 30 15 17

39 30 16 24

35 37 12 16

40 44 16%

41 41 18%

43 42 15%

38 45 17%

38 46 16%

42 44 14%

28 50 22%

Source: Company research Note: To be read, for example: 48% of respondents who claimed Ivory Liquid as their usual brand had used an automatic dishw * Defined as +15 sinksful per week. **Female head of household. *** The heavy LDL-user skew toward older respondents may be misleading. P&G management believed that, though users was

Exhibit 18 LDL Category Assessment (4-week blind in-home use test of H-80 in 45

Attribute Ratings (%) Overall Cleaning Removing baked/burned/dried-on food Grease Removal Amount of suds made Mildness Amount of suds made Mildness Mildness Odor of product Color of product Favorable Comments (%) Unduplicated cleaning Cleans well Cleans hard-to-remove food Cuts grease Unduplicated sudsing Product color Mildness Unduplicated odor Unduplicated sudsing Product color Mildness Unduplicated odor Product color Mildness Unduplicated odor Unduplicated cap/container Unduplicated consistency Like scrubbing particles/abrasives Unfavorable Comments (%) Unduplicated cleaning Not clean well Not clean hard-to-remove food Not cut grease Unduplicated sudsing Product color Mildness Unduplicated odor Unduplicated cap/container Unduplicated consistency Not like abrasive/gritty feel Dishwashing Information Used product full strength for scrubbing Used scrubbing implement for tough jobs

Source: Company research. Note: To be read, for example: 77% of the 425 households who used H-80 rated it as 4 or above on a 5-point scale on overall performance. * Unmarked bottles of H-80 were given to one of two representative samples of LDL users. The other sample group received unmarked bottles of an established competitive brand. Both brands were accompanied by instructions suggesting the product be diluted for general dishwashing but used full strength for tough dishwashing jobs.

bit 18 n-home use test of H-80 in 45 households) Established Competitive LDL with Scrubbing Instructions * 71 73 61 72 69 63 68 69 65 29 15 32 45 5 34 40 2 2 9 1 5 8 17 3 14 9 2 1 1 52 85

H-80 with Scrubbing Instructions * 77 79 73 77 73 55 70 72 73 36 25 34 49 6 25 45 8 12 12 4 1 3 9 1 16 10 2 12 11 61 79

Exhibit 19 Selected Research Data: Personal Feelings Concerning Dishwashing

1. What is the worst thing about doing dishes? The time it takes Having to do them Cleaning pots and pans Scrubbing/scouring Cleaning greasy items Hard on hands 2. What is the toughest dishwashing job? Removal of baked/burnt/fried/cooked foods Removal of greasy foods Cleaning of pots and pans Cleaning of skillets Cleaning of casseroles Cleaning of dishes 3. What is most disappointing about your current dishwashing liquid? Nothing Suds disappear Leaves grease Odor Hard on hands Price/expensive Have to use too much 4. What improvement do you want the most in a dishwashing liquid? Milder to hands Do it by magic/itself Eliminate scouring or soaking Cut grease Soak dishes clean Suds never vanish Nothing/satisfied Source: Company research.

Dishwashing % of Consumers 24% 22 15 14 6 4 39 32 22 16 7 3 51 12 8 6 2 4 4 11 10 9 9 9 6 9%