Driving sales, of course, is an interest in environmentally-friendly products; but while market leader Procter & Gamble extols the benefits of washing in cold water and Unilever/Seventh Generation talk up their recyclable packaging, consumers tune in to a completely different message—whether marketers and their suppliers like it or not, according to Josh Winters, a research associate with Euromonitor International.
“When consumers think ‘green,’ they want ‘natural, non-toxic’ chemicals,” said Winters. “When we ask consumers, ‘what is natural,’ it’s not about what’s in the product, it’s about what’s not in the product!”
The reality is, consumers are scared of chemicals, and marketers must do a better job of allaying their fears no matter how irrational those fears. One successful example, admittedly in a different category, according to Winters, is Colgate’s education campaign for its microbe surface cleaners.
“Colgate is really pushing the lack of chemicals in its message and explaining to consumers that a home can be a healthy biome and convincing consumers to think about a clean home in a different way,” he told Happi. “Colgate is saying lemon-scented isn’t clean.”
The competitive world of FMCG claimed another victim this month, when Henkel Chief Financial Officer Karsten Knobel took over as Henkel CEO after Hans Van Bylen was forced out following a string of poor results, but that doesn’t include detergent. For the 52 weeks ended Nov. 3, 2019, according to IRI, sales of Persil unit dose detergents outpaced overall unit dose sales gains.
“Persil is an interesting case,” observed Winters of Euromonitor International. “Companies with premium-priced liquids have had an easier time switching consumers to unit dose. That’s why Persil has been declining in liquid and has healthy growth in tablets.”
At the same time, the No. 2 player in the US liquid laundry detergent category, Church & Dwight, recorded a 5% gain in sales and an 8.8% gain in unit dose. But the big winner, according to Winters, is private label. In a quick scan of the data, private label is set to outpace national brands in tablets, concentrated liquids and prewash stain removers. Consumers are drawn, of course, to lower prices, but something else is at work here, according to Winters.
“There is less brand loyalty today, especially among younger consumers,” he told Happi. “With shorter patent periods, private label can enter unit dose and other categories faster than ever. It is definitely something to keep an eye on.”
Of course, everybody has their eyes on Solimo, Amazon’s private label brand, which now offers laundry detergent packs, concentrated laundry liquids and automatic dish detergent packs.
According to Euromonitor’s shopping preference data, 27% of shoppers seek private label and low-cost products. Moreover, future spending habits suggest consistent growth of private label.
“The majority of those who seek out private label said they will increase their spending on private label in the next 12 months,” he added. “Millennials aren’t loyal to national brands.”
Winters noted that as private label brands invest in their products, even segmenting them, consumers are open to try new categories. For example, they may start with a Target stain remover and, happy with the results, try Target unit dose detergents.
“That trust is building across all categories, which is why we see growth across all private label categories, especially surface care,” he explained.
For example, sales of private label wipes rose 20% in 2019 and hold more than 25% of all-purpose wipes sales.
“Private label is something to monitor,” he warned.
Even market leader Procter & Gamble, with a share approaching 80% in some fabric care segments, has reason to be concerned with the march of private label. But that hasn’t stopped P&G from launching a variety of fabric care formulas in the past year in the areas of cleaning, wrinkle prevention and plant-based cleaning products. About a year ago, P&G leveraged Tide Pods’ multi-chamber design with an improved formulation that is said to provide better whitening, brightening, and freshness in one, easy-to-use pac to provide an effortless, yet effective washing experience, explained spokesperson Mary Johnson.
For heavy duty laundry problems like caked-on dirt, tough odors and set-in stains, Tide Heavy Duty 10X is the newest and best stain removing detergent from Tide. The formula includes 10 concentrated cleaning ingredients to remove tough stains and keep them off in the wash.
“It was designed for the working professional who experiences the torture test for stains, but can also handle tough laundry challenges at home, whether they come from the auto shop or the playground,” explained Johnson.
At the opposite end of dirt spectrum, new Studio by Tide is a collection of products that provides gentle protection to the clothes you care about most with a great clean. According to Johnson, many consumers fear that the first wash may ruin their new garments.
According to P&G research, 80% of people experience in-wear wrinkles and are actively seeking solutions or trying to compensate; for example, 65% try to smooth their clothes by hand; 50% will avoid slouching, crossing their arms and/or legs; 34% will remove their jacket before getting in the car, and 27% will pull the shirt out from under the car seatbelt. But all of their efforts can quickly become undone by sitting.
“Most of us sit for 13 hours a day, which can build up pesky wrinkles,” explained Johnson.
The solution? More than 30 scientists spent more than 14 years developing a product with seven new patents to provide a wrinkle solution. New Downy WrinkleGuard Fabric Conditioner contains a technology that increases fiber flexibility to help provide in-wear wrinkle prevention all day long. The patented and exclusive fiber-relaxing technology penetrates between and into fibers to improve flexibility and help prevent wrinkles, while the fabric conditioners reduce friction and help protect against stretching, fading and fuzz.
“For wrinkles out of the dryer we’ve introduced new Downy WrinkleGuard Dryer Sheets, our best wrinkle fighting dryer sheet yet,” said Johnson.
“With triple the wrinkle relaxing ingredients of regular Downy sheets to fight wrinkles formed in the dryer while it also fights static,” explained Johnson. “We’ve also introduced Downy Wrinkle Releaser Spray. It’s an on-the-go solution with Fiber Relaxers that allows you to smooth out wrinkles with the swipe of your hands as it also removes odors and freshens in between washes.”
Euromonitor analysts may disagree, but P&G is focused on designing more plant-based products to meet consumer needs and help increase its use of renewable materials. Procter added a plant-based portfolio in fabric care, with Tide Purclean, Downy Nature Blends, Dreft Purtouch and Gain Botanicals and launched Home Made Simple, a plant-based home care and cleaning line designed to meet EPA Safer Choice and USDA Standards. Also new is 9 Elements, a vinegar-based laundry and cleaning line made with no more than nine essential ingredients and no artificial preservatives, dyes or thickeners.
According to Johnson, as more people strive to adopt resource-efficient habits, it becomes increasingly important to use products designed to perform in the toughest conditions. For washing clothes in shorter, colder cycles, Tide is designed with a specific enzyme to clean in the quickest, coldest wash. To get clean dishes with less water, Cascade lets users skip the rinse and save up to 15 gallons of water per load.
“If you’re using a lower performing product and something don’t come clean, chances are you’ll compensate for that by washing it again—this time with more water or more product, driving your footprint up,” explained Johnson. “So that’s why we design products like Tide and Cascade specifically to help you save water, time and energy, without sacrificing the clean you need.”
Johnson agreed that how products are made matters, too. P&G’s facilities use 100% renewable wind power electricity and send zero manufacturing waste to landfill. In packaging, P&G created a recycling stream for colored PET, and is working to find alternatives to plastics, like Cascade cartons made from 100% recycled wood pulp, and the reusable stainless steel packaging for Tide Purclean in Loop.
“Finally, we know people have many reasons to be interested in what ingredients are, and are not, in the products they use, so we’re being transparent about what’s in our products and why,” explained Johnson. “We believe ingredient information should be available to you wherever you are, so we were one of the first companies to participate in the online SmartLabel system, where you can find information about all of our fabric and home care products listed. We are working to incorporate more of this information onto our packaging to further our transparency efforts and enable consumers to make informed choices.”
Trade associations are working to ensure that consumers’ need for transparency doesn’t interfere with their members’ ability to protect critical business information. In fact, Melissa Hockstad, president and chief executive officer of the American Cleaning Institute, said ingredient communication continues to be a top issue for the cleaning industry.
“We had a great victory in New York,” said Hockstad in reference to the September 2019 decision by The New York State Supreme Court which invalidated the Household Cleansing Product Information Disclosure Program (HCPIDP) issued by the New York State Department of Environmental Conversation (NYSDEC) on the grounds that they did not comply with the State Administrative Procedure Act (SAPA).
ACI executives say they are hopeful that New York with work with ACI and allied trade associations to create a workable ingredient transparency program like the one in California. Of course, the industry wants to avoid a patchwork of state laws.
“We want a federal law regarding ingredient communication,” said Hockstad.
To get its message heard in Washington DC, during its Fall Meeting in September, ACI members visited the offices of key committees on Capitol Hill that impact the industry. According to Hockstad, Congress wants to work with ACI and allied trade associations; they understand the need for a federal-based approach to ingredient communication (for more on the topic, see p. 62).
In addition to ingredient communication, ACI continues to work with the US Food and Drug Administration providing data on the active ingredients that are critical to hand sanitizers.
“We have a good relationship with the FDA and that will continue,” explained Hockstad. “FDA appreciates our commitment to generate the data for several active ingredients.”
As a result of this commitment, FDA has deferred, until August 2020, three active ingredients—benzalkonium chloride, ethyl alcohol, and isopropyl alcohol—from further rulemaking to allow for the ongoing study and submission of additional safety and effectiveness data necessary to make a determination regarding whether these active ingredients are generally recognized as safe and effective for use in OTC consumer antiseptic rub products. Their status will be addressed either after completion and analysis of the studies or at another time, if these studies are not completed. At this time, the FDA does not intend to take action to remove hand sanitizers containing these three active ingredients from the market.
In September, ACI issued its 2019 Sustainability Report detailing its strategy, “Our Future Is Clean,” to achieve a cleaner world. The plan is designed to unite industry efforts for greater impact across four goals: increase transparency, reduce emissions, value nature and contribute positively. Members will hear more about this strategy when ACI’s Annual Meeting & Industry Convention at Grande Lakes Orlando gets underway this month.
“We are very excited about the convention. It provides the best business value for the supply chain under one roof,” said Hockstad. “It is always a great combination of business, networking and communication, and we are adding more value with more education programs.”
Some of the highlights include an industry leadership panel, featuring executives from Procter & Gamble, Stepan and Ecolab; a global industry update featuring association executives from around the world; and “Naturally Confused,” a consumer panel sponsored by Takasago that is designed to help consumers understand the concept of “naturals.” In addition, there will be a session on microbiomes and the future of cleaning.
In 2020, ACI will focus efforts on helping its members grow, producing positive legislative outcomes, sustainability and communications. As if that’s not enough, the Association moved to a new location in Washington DC last month. The new headquarters are located at 1401 H Street. The telephone number remains the same (202-347-2900).
It may be January, but it’s not too early to start making plans for the Fabric and Home Care World Conference taking place November 17-19 in Shanghai. Under the theme, “Achieving Business Agility,” the program will explore ways industry can become more agile and increase customer value through design thinking. According to 2020 Conference Chair Manfred Trautmann, the CEOs of Procter & Gamble, Unilever and TerraCycle have already committed to make presentations, and Trautmann is confident that executives from leading Chinese companies such as Alibaba and WeChat will also make presentations.
“We never have an issue attracting top speakers. We deliver an audience that makes industry leaders want to address our attendees,” he explained.
On issues of sustainability, topics will include plastic waste reduction, carbon capture and sustainable fragrances. Technology presentations will focus on robotics, digitalization and social media.
“How do smart machines and other technology impact our business?” asked Trautmann. “What is the new business model to deal with these changes? These are questions that will be answered in Shanghai.”
This is the first time that the Fabric and Home Care World Conference will be held in China, a change that is by design.
“The growth area today are in Southeast Asia and China; both have higher average growth than the US and Europe,” he noted. “Unit dose has changed the way Americans do laundry and now that change is occurring in Europe. Ultimately, it will impact China and southeast Asia.”
At press time, Euromonitor International researchers were putting the finishing touches on their global laundry care study. According to preliminary numbers, global laundry care retail sales are expected to reach nearly $97 billion by 2024, representing a CAGR of 2.7%. For the Asia-Pacific region laundry care, Euromonitor’s 2019-2024 CAGR is 4.3% and China is expected to grow even faster, with a CAGR of 5.8%, 2019-2024.
“Major industry players are heavily engaged in China. All have made investments in R&D and the local supply chain. China is one of the most important markets in the world,” observed Trautmann.
As formulators and their suppliers look to emerging markets, they must grapple with new issues, too. As more consumers wear garments that contain synthetic fibers, use HE washing machines that wash with less water and colder water, and do fewer, much larger laundry loads, laundry is actually getting more difficult to clean, because cleaning isn’t just about removing visible stains, explained Johnson.
“Seventy percent of the soils on clothes come from our bodies and more clothes in each wash means more body soils and odors,” she said.
Body soils stick to synthetic fibers more than natural fibers and are harder to remove with the colder wash temperatures in HE machines. In fact, odor removal has surpassed stain removal to become the new No. 1 unmet consumer need, according to P&G’s research.
“That’s why Tide Pods continues to innovate, delivering an improved formula early in 2019 to meet the evolution of consumers’ laundry habits,” said Johnson.
While Procter & Gamble has dominated the laundry category for decades, there is room for smaller players in a category that is ready for disruption—again. Startups are entering the category at a rapid rate, drawn by ease of entry, a lack of consumer loyalty and other factors.
“Consumers want new attributes like sustainability and health, and because of the success of direct-to-consumer in other categories, Dollar Shave Club took serious share from market leaders, it might work out in laundry care,” observed Winters. “We haven’t seen it yet, but it is coming. The category is ripe for creative companies.”
And that means there are more opportunities for growth in the global laundry care market.
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