As Western companies duke it out for a piece of the developing-market pie, Procter & Gamble is going deeper  -- courting not just the newly rich but also the very poor. The company's vaunted R&D operation is turning up surprises.

By Jennifer Reingold, senior editor

Wei Xiao Yan, a 29-year-old farmer in China, washes her hair in the doorway of her kitchen. P&G researchers spent a day with her at home.

We are a long, long way from Cincinnati. Getting here required a 15-hour flight to Beijing, followed by a nearly three-hour flight to Lanzhou, an industrial city on the Yellow River in China's midsection, and, finally, a bumpy, two-hour drive deep into treeless hills the color of dried clay. Our destination, in a pinprick of a town called Shahe, is a small cinder-block house framed by Szechuan pepper trees, its primary decoration a poster of Chairman Mao. Eight of us -- a reporter, a photographer, two local "fixers," a translator, and three executives from Procter & Gamble -- have come here so that we can watch a 29-year-old corn and potato farmer named Wei Xiao Yan wash her hair.

And she washes it with gusto, especially considering that she is doing it in front of a crowd while standing in the doorway of her kitchen, using a small metal basin with no more than three cups of water. Water scarcity is the rule here; the family stores rainwater in a well and must pay a private company for anything more. After trying to work up some lather with a tiny bit of Rejoice -- P&G's cheapest local offering, which costs about 10 renminbi ($1.50) a bottle -- Wei Xiao Yan does a cursory rinse, then forces the family comb through her tangles. "The shampoo puts nutrients in my hair," she says, noting that it is her first bottle of real shampoo after a lifetime of using laundry soap flakes, which made her hair oily. I make the error of asking her if it might not be more practical to cut her nearly waist-length hair. She looks at me with disdain. "As a woman, you should have long hair," she snaps. "And my husband likes it." More