|Title:||United Kingdom top 10 household cleaning products by advertising expenditures broken down for advertising medium in pounds sterling and percent change for the year ended October 31, 2011|
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TOP XX ADVERTISERS
Household: X November 2010-XXXctober2011
TOTAL CHAN [pounds y-o-y% Cinema% Outdoor% Press& Radio% TV% sterling]m
Vanish XX.X -XX.X * * X.X * XX.X
Persil XX.X XX.X X.X XX.X XX.X XX.X XX.X
Ariel XX.X -XX.X * * X.X X.X XX.X
Comfort XX.X XXX.X * XX.X XX.X * XX.X
Glade XX.X XX.X * * * * XXX.X
Feibreze X.X XX.X * * XX.X * XX.X
Finish X X.X -XX.X * * X.X * XX.X
Air Wick X.X X.X * X.X * XX.X
Kleenex X.X XX.X XX.X X.X X.X * XX.X
Domestos X.X XX.X * * XX.X * XX.X
Top XX XX.X XX.X X.X X.X X.X X.X XX.X total
In a market characterised by a slowdown in spending on nonessentials, suppliers of household products are having to ask themselves a fundamental question: do consumers really need to buy my product?
In many cases in the past year, the answer has been no. "It has not been an easy year," concedes Stefan Gaa, Reckitt Benckiser UK marketing director. "We've had to be very innovative and competitive/'
Of the XX household products sub-categories, seven experienced volume declines and although inflation-driven price rises kept value sales artificially in the black, there are clear signs of consumers cutting out discretionary items and turning to versatile products that help deliver a total cleaning solution.
The star performers are multi-purpose brands such as Dettol and Flash, with value sales up X.X% and X.X% respectively, while more task-specific products such as Toilet Duck and Bloo are down, by X.X% and X.X% respectively [SymphonylRI XXw/e XX November 2011]. At a category level, the worst-performing sub-categories encompass more discretionary products such as toilet soaps, fabric conditioners and autodish.
"Some consumers, especially in cleaning, have reduced the repertoire of products they are using, especially turning away from very specialist products," says James Griffin, homecare category manager for Unilever UK.
It's the same on the 'hardware' side: Laurence Smith, commercial director of EnviroProducts, adds: "There is a trend to find one product that performs well and then stick with it. Our key lines remain our general purpose cloth and our glass and polishing cloths, which are multi-purpose."
A reduction in consumption of non-essential items is not the only factor negatively affecting the category. Laundry detergents, accounting for around XX% of total category sales, saw year-on-year decreases in both value and volume as shoppers left the category and those remaining gravitated towards larger packs, driving down frequency of purchase and spend. The past year has also witnessed a slight rebound for laundry powders - which invariably command a low price per unit - albeit in the context of a long-term shift towards liquids and gels.
Griffin acknowledges the trend towards larger packs but believes the market is already starting to tilt back towards medium packs. "This trend has been changing in the past few months. Firstly very large packs only appeal to larger households that contribute to about half of all washes each week in the UK. Research shows larger packs are polarising and, being relatively big ticket items, do not appeal to the smaller households doing the other XX% of washes."
The consumer shift towards bigger packs hasn't been all bad news for suppliers, either. Tim Smith, UK general manager of eco-friendly cleaning brand Method, reports that many consumers traded up to bigger, better value formats. In October last year, Method claimed a category first with the launch of laundry detergent refills that contain XX washes, working out at iXp per load as opposed to XXP for the brand's standard laundry detergent. "Consumers understand they're getting better value from that and they also realise they're doing something good for the environment because there's not as much packaging," says Smith.
Sainsbury's has helped boost sales of larger detergent packs over the past year by highlighting the pence per wash on its shelf tickets. Detergent buyer Sabine Tester says nearly all laundry brands are in growth in Sainsbury's, bucking the overall market trend. Indeed, Sainsbury's was the strongest-performing of the big five in the total category, delivering growth of X.X% compared with sales declines at Asda, Morrisons and The Co-op [Kantar WorldpanelJ. "Key areas of growth have been in cloths and sponges, cleaning wipes and dishcare - both auto and hand, where we've outgrown the market. We're also now starting to see growth in own label, particularly in the cleaners and wipes sector following a relaunch in August, and in cloths and sponges," reports Sainsbury's household buyer Alicia Sealey.
Across the whole household category, own label has struggled in the past year, growing at just X% in value, slightly behind branded products. In May, McBride, the UK's biggest supplier of own-label household products, warned its full-year profits would be [pounds sterling]Xm lower than expected due to escalating commodity prices, and although it managed to push through price increases of up to X% in the second half of 2011, sales increased by just X% [www.thegrocer.co.uk]
Gaa believes brands need to be credited for their strong value proposition that has not forced consumers into seeking cheaper own-label alternatives in difficult economic times. "A lot of the brands over the past one or two years have also offered great value."
With consumers paring back their repertoire of household products, continued investment in innovation has been vital to achieving individual brand success, according to Ian Morley, fabric and home care marketing director, P&G UK & Ireland. "In an increasingly challenging economy, we have refocused our efforts on large, breakthrough innovations that will deliver consumer benefits and long-term growth."
Over the past year, P&G has restaged its entire Lenor premium portfolio to incorporate a more powerful scent formula across its infusions line-up; introduced a new SKU to its Ariel Stain Remover range - Ariel Stain Remover Hygiene - and launched its limited-edition Bold Xini pink Infusions SKU, Rose Blush & Peony, as a permanent line.
Rival Unilever, meanwhile, has resurrected Persil washing-up liquid, having axed it in 2010; revamped its Surf range; and, in Comfort Bright Whites and Comfort Bright Colours, launched a product it claims will revolutionise laundry conditioning.
Unilever's other major laundry innovations of the past year have been Persil Xini, which employs 'XX-minute technology', and Persil Xini with Comfort, its first-ever two-in-one detergent product.
Arguably Unilever's biggest household innovation, however, has come in Domestos, which has been completely revamped and reformulated to create Domestos Extended Germ Kill (see right).
Value sales of Domestos soared XX% in the past year [SymphonyIRI] but it was unable to replicate that success with volume, which fell X.X% [SymphonyIRI]. Indeed, just one leading cleaning brand - Reckitt's Dettol - was able to achieve growth in both value and volume.
Gaa identifies three elements behind Dettol's success: the importance that consumers attach to fighting germs, sound communication, and strong innovation. Dettol's No-Touch Hand Wash System, launched in 2010, automatically senses hands and dispenses just the right amount of soap. It is "a complete step change for a very commoditised category", according to Gaa, who also highlights the ongoing success of the Dettol for Health campaign, which offers consumers tips on how to live healthier and more hygienic lives on Facebook and its website.
Reckitt's Air Wick brand has also benefited from strong innovation. In July, Reckitt launched Air Wick Odour Detect, an air freshener that can detect rapid changes in odour levels and releases a neutralising burst of fragrance. The launch has contributed to a X.X% increase in sales of Air Wick [Nielsen XX w/e X October 2011].
One brand not faring so well is Ecover, the environmentally friendly cleaning brand. It has seen mixed results across its core subcategories, with its detergent in particular struggling: its value sales are down by XX.X% and volume by X.X% [SymphonyIRI]. Where eco-brands once had a strong point of difference, now that sustainability has been embraced by mainstream suppliers (albeit from the opposite direction), simply being green is no longer enough, suggests Gaa. "Consumers' whole attitude to the environment has changed. It has become much more of a must-do for the manufacturer to look at optimising their product from an environmental perspective. Consumers realise they don't necessarily need to buy specialist green products to be environmentally friendly."
Consumers are purchasing and using products more sustainably than ever, according to new research by the International Association for Soaps, Detergents andMaintenance. The findings coincide with the release by the European cleaning industry of its new Charter for Sustainable cleaning logo, which guarantees that the product meets high sustainability standards for helping protect environmental safety and promoting efficient use of resources. Shoppers across Europe will begin to see the new Charter logo on mainstream lines this year.
That's not to say the desire to be green is the only driver of the market shift towards sustainable products. Increasingly, the pressure to economise on utility bills is pushing consumers towards energy-efficient products and processes. "A few years ago the driver was all about being kind to the environment, which stimulated growth of concentrated liquids in particular," says Griffin. "More recently, economic woes have seen many consumers think harder about how they do their household chores. Many are realising, particularly as they get their latest household energy bills, that by doing their washing at lower temperatures and/or on quicker cycles, they use less electricity and water."
P&G aims to have more than XX% of its consumers washing in cold water by 2020 through its ongoing Turn to XX' programme. Its Ariel Excel Gel, launched in 2008, works at XXC and its continued success has contributed to sales growth in Ariel Gel of X.X% in the past year [SymphonylRI].
Suppliers admit, however, that while pushing their green credentials is important, brands can't afford to lose sight of the need to deliver on performance and price. "In the cleaning category, people are expecting a high level of performance," says Smith. "While the majority of people want to be green and friendly, they don't want to compromise on the quality of the product."
Smith believes EnviroProducts' core e-cloth product ticks all the right boxes. The brand is positioned at the premium end of the market and, owing to its micro-fibre technology, uses water alone to clean over XX% of bacteria from any hard surface around the home. "We are a core product. We are helping to eliminate the need for some discretionary products. The e-cloth is a strong-performing product - not only does it remove dirt and grease, but by leaving surfaces clean, it removes odour as well"
Method is another supplier that believes its products add value beyond their green credentials. Sales of the brand have grown by around XX% in the past year, it claims, with specialised products such as granite surface cleaners bucking the trend for declines in sales of task-specific products. Tim Smith believes Method's strength lies in the fact it doesn't rely on its greenness to sell. "Over time, green will become almost commod-itised, almost something that is expected. The reason we've succeeded in the last couple of years is because we offer something more than that; so yes the product is green, but it also works very well and the fragrances are exceptional."
Smith also alludes to the aesthetic quality of Method products as a reason for the brand's popularity with consumers. "The bigger brands have been more focused on fighting their battles with products that are a little bit less differentiated than ours. Looking at our products, consumers like the fact that they can put them out on their kitchen counter, and it can be a positive expression of their personality."
Traditionally viewed as pragmatic, rather I than inspirational, as a category, more and more brands such as Method are seeking to inject some personality into the sector. The Bizzybee brand, for instance, sells gloves and cloths that are intended as an antidote to the dreary products that characterise the household fixture. Its Elegance gloves are elbow length and inspired by Audrey Hepburn, while the brand has recently launched a new range of polka-dot patterned cloths and gloves (see XX).
"Consumers are now very conscious of their purchase decisions, but at the same time they don't want to hold back on novelty, so we are bringing them something that is not only fit for purpose but looks great as well," says Uk consumer marketing director Irene Martinez.
In reality, looking great while cleaning may be a consumer aspiration for some - who doesn't need cheering up? - but for the vast majority, getting the job done quickly and in the most cost-efficient way possible is the overriding priority. And, in the face of static market growth, persuading consumers that household products are worth splashing out for at all must be uppermost on all suppliers' agendas.
* Household has seen a X.X% growth in value, but in a category that already attracts XX% of UK households, this is clearly not down to an increase in shoppers. Growth has been driven by higher prices, particularly in autodish, fabric conditioners and household cleaners.