A 1931 P&G memo told each brand to act like its own business — and built brand management

On May 13, 1931, in Cincinnati, a 27-year-old promotions manager named Neil McElroy typed out a three-page memo. Six years earlier he had joined Procter & Gamble as a summer intern and risen from the mail room to the advertising team; his boss, company president R. R. Deupree, wanted separate branding teams inside the portfolio and asked McElroy to formalise the idea. The memo proposed 'brand men' — and brand management was born.

The memo assigned the new role full responsibility for a brand's packaging and advertising, sent brand men out with regional sales teams to see plans executed in the field, and required them to analyse sales, build marketing plans and monitor results with research — supported by a dedicated team of market researchers and assistants. Most radical, each brand team could openly compete with other P&G brands in the same category. McElroy had watched bigger brands drain resources and attention from smaller launches, and feared that would leave P&G exposed to outside competitors.

By 1953, Time could describe the system running at full power: for every P&G product there was a 'brand man' who took full responsibility for results. The company had been decentralised into what the magazine called a cluster of separate organisations, each with its own boss, and P&G had become the biggest advertiser in the United States, spending an estimated $30 million in network radio and TV plus $15 million in print that year. Its own brands traded insults on the air — and when Tide grew too fast, McElroy brought out Cheer to compete with it, settling into second place in detergents.

The system carried its inventor upward: McElroy rose to advertising manager, vice president and president, building the brand-management structure as he climbed, and later served as U.S. Secretary of Defense. The memo's logic — one product, one accountable general manager — spread through consumer goods and became the profession's founding document.

Give each brand one owner, run it like a business

A single accountable owner per brand made results attributable: when sales slipped, the brand man had to find out why, so problems surfaced at the product level, not in company-wide averages.

Dedicated research and assistant teams per brand protected new launches from being starved by flagship brands — the exact cannibalisation McElroy had seen firsthand and wrote the memo to stop.

Internal competition turned the portfolio into a standing test bed: Tide got a house challenger in Cheer rather than leaving the market open for Colgate to fill it.

The structure made expansion cheap in focus: adding a brand meant adding an owner, not widening a committee, so P&G could run dozens of competing products without losing track of any.

Ownership beats oversight. Give every product an owner whose results cannot hide and decisions move at market speed; deliberately competing with itself keeps a company ahead of rivals.

Time in 1953 credited the individual brand-management system as what gave P&G its competitive drive, by then the largest advertiser in the U.S. The model spread from P&G to its competitors and eventually across the marketing field; Branding Strategy Insider, revisiting the memo in 2009, called it three pages of strategic advice still valid 78 years on, with the original now a prize antique in P&G's corporate archive. McElroy became company president in 1948 and chairman after his 1957–59 stint as U.S. Secretary of Defense.