Meanwhile, SC Johnson’s Nature’s Source
has also lost shelf space at some retailers
this year, say industry sources.
Why the decline? Blame a weaker economy and stronger skepticism by consumers.
According to results of a September poll by
GfK Roper Consulting, there’s been a dramatic increase in the percentage of U.S. consumers who say that they are wary of
environmentally friendly product alternatives. The share of consumers who think
green products are too expensive rose eight
points in two years to 61%, while those who
believe they don’t work as well jumped nine
points to 33% and those who believe they’re
not even better for the environment in the
first place increased eight points to 38%.
Add to all that are difficult comp sales,
as a year ago, the H1N1 scare had every
consumer running for the disinfecting
sprays and wipes.
Industry observers insist that only true
innovation can help the household cleaning products category find its way back to
the levels of profitability it enjoyed a few
years ago. In a recent conference call to analysts, Clorox reported that cleaning product sales fell 1% in its first quarter while
volume improved 1%.
“While our Q1 results were a little
weaker than we anticipated, we are win-
ning the competitive battle, as evidenced
by several consecutive quarters of share
growth,” explained Larry Peiros, executive
vice president and chief operating officer.
“Investing in the long-term benefits of our
brands. When the economy recovers we
will benefit disproportionally.”
Peiros maintained that the growth of
private label has flattened and has even
started declining a bit in the channels
tracked by Clorox. Moreover, as the econ-
omy improves, the pace of innovation will
begin to improve as well.
“We believe that we’re through the
worst of it as we get through with this
quarter and we head into calendar year
FY’ 11,” explained Don Knauss, chairman
and chief executive officer, Clorox. “A lot
depends on the pace of innovation that
CPG puts out there. You’ll obviously see
that ramp up.”
Clorox executives wouldn’t disclose
what’s on tap in terms of new product introductions in 2011, only stating that several new items in the home care lineup are
in the works. But Knauss insisted that the
Clorox team feels very good about the
pipeline that its got starting in January.
Unfortunately, maintains Wasik, the
company has a lot more to contemplate
than a new cleanser or two. In September,
Clorox sold its auto care business to Avista
Capital Partners for about $780 million.
“Clorox did not get a great price for their
auto business—selling to a sponsor and not
a strategic could be considered a failure,”he
told HAPPI.“I think Burt’s Bees is tying up
more of their time and resources than anyone admits. They have to make it work as
they staked so much of the company on it.”
The story was a bit different at Reckitt
Benckiser (RB), where surface care sales
rose 4% in the third quarter, despite indexing against H1N1. One reason for the gain
is RB’s strength in developing markets
where, during the past decade or so, the
company has been very successful in rolling
out its powerbrands such as Vanish and
Harpic into countries where specialty products such as toilet bowl cleaners didn’t exist
only a few years ago. For example, right
now, RB is focused on rolling Dettol disinfectant into new markets.
Consumer sentiment toward green
products may have waned in the U.S., but
that didn’t stop Method from rolling out its
first line of botanical household disinfectant sprays and wipes in August. The
Method Antibac assortment of antibacterial, antiviral and antimicrobial products is
registered by the EPA and consists of two
cleaning sprays—one for the bathroom and
the other for the kitchen—and all-purpose
cleaning and disinfecting wipes.
For the antibac, Method partnered with
CleanWell Company, maker of a thyme-based disinfecting technology, to create a
patented botanical formula that kills
99.99% of household bacteria including
E.coli, salmonella enterica, influenza A and
H1N1 virus on hard, non-porous surfaces.
The bathroom spray is optimized to
target soap scum and hard water stains