PROCTER & GAMBLE still rules the roost when it comes to the US laundry category, but it’s Henkel that’s crowing loud- est these days. The German multinational grabbed headlines more than a year ago when it dared to challenge P&G on
its home turf with the rollout of Persil in the US—a launch that
quickly gained traction. According to Ian Bell, head of home care,
tissue and hygiene research, Euromonitor International, the Persil
launch lifted Henkel’s sales from $67 million in 2015 to $150 million last year. Next, Henkel made an even bigger bet on the New
World with the August acquisition of Sun Products for about $3.6
billion. The move immediately gave Henkel a better position in
the world’s biggest laundry care market.
“As one would expect, Henkel has been the big mover in the
laundry category,”noted Bell.“Sun had been hemorrhaging mon-
ey, down $50 to $100 million a year, for several years.”
With a new owner, brands such as All and Snuggle may see a
revival just as the US laundry category enters a new era of growth.
According to Euromonitor estimates, US laundry care sales rose
for the first time since 2011, adding 2.3% year-on-year to top $12
billion. The gain, of course, is due to the continued success of unit
dose formulas. Bell noted that unit dose formula sales totaled just
$2.5 million in 2011, its first year on the market. In 2016, unit dose
sales rose 20% to $2.5 billion. Meanwhile, sales of liquids rose
1.5%, and powders fell 8%.
The rise of unit dose
doesn’t surprise Jonathan
Propper, CEO of
Cot’nwash, who created
Dropps unit dose detergent in 2008. Back then,
that unit dose would
never come to the
laundry detergent aisle
because people love to
control their own dosing.
“But then the re-
cession came, people
started trading down in
laundry due to a lack of
innovation, and suddenly the big guys decided that people don’t
need to control the dose!” he recalled.
Recent data from Information Resources, Inc. (IRI) are even
more promising. Laundry detergent sales rose more than 3.3% to
over $7.1 billion for the 52 weeks ended Oct. 30, 2016. The liquid
laundry category still accounts for more than 70% of sales ($5.2
billion), while powders could only muster sales of $731 million,
according to IRI (see chart).
“Eventually powders will just disappear,” predicted Bell.
Another laundry loser is private label. With price wars among
the national brands heating up again, the price differentiation between store brands and multinationals isn’t great.
“There is a matter of trust in detergent formulas not making
a mess of one’s wardrobe,” noted Bell. “Why should consumers
rely on private label formulas, when they can buy an inexpensive
For example, a 138oz bottle of Tide Simply Clean & Fresh re-
cently retailed at Walmart for just $9.97 or just 7.2 cents an ounce;
even better, Arm & Hammer 2X Ultra Clean was on sale for $9.98
or 4. 8 cents an ounce.
No wonder, then, that private label hasn’t made headway in
laundry care like it has in other fast-moving consumer goods
sectors. P&G, Henkel and Church & Dwight dominate, and will
continue to dominate the US laundry business, said Bell.
Still, that doesn’t mean other companies aren’t trying to
make in-roads. Chief
of these is Unilever,
Seventh Generation in
September. The Anglo-Dutch giant paid nearly
$700 million for the
maker of environmen-tally-friendly detergents,
something that Unilever
is keen to capitalize on as
it tries to woo Millennials
who are said to be greatly
concerned with sustainability issues. The
Tom Branna • Editorial Director
Are the worst days over for the US laundry category? Sales are up, innovation
continues and Henkel is determined to make it a dogfight in the detergent aisle.
Persil Proclean from Henkel is making headway in the US