Putting The Shine On

9/1/2011

Suppliers have some advice for grocers: “Don't give up — clean up!”

Innovation. Excitement. Shopping destination. A tool for building a store's image and strengthening its brand. Can those words and phrases actually apply to a supermarket's household cleaning and laundry departments?

A number of suppliers believe they do, and they say many supermarket operators are proving it. But they also say many more are failing to meet changing consumer needs and to leverage new product opportunities — and are ceding category sales and profits to discounters, home centers and big-box competitors.

Certainly, there are innovation and plenty of new products within the cleaning and laundry categories, but there's also the danger of trading sales of one product for another and doing little more than confusing the consumer. Clearly, it's a challenge.

As with most GM categories, the reality is that many supermarket operators are focusing on perimeter innovation and strategies to build shopper excitement, sales and profit. Unfortunately, in many cases this is occurring at the expense of GM, either in terms of space or commitment, and possibly both.

“There is constant pressure on space as grocery store management tries to determine what direction they should go,” says Jasper McKinney, president of Aero Concepts, a Middlebury, Ind.-based manufacturer of household chemical products, including the new line of Evolve brand laundry and dishwashing tablets. “With food retailers, the landscape has changed dramatically over the last decade. Supermarkets had control of a lot of different categories, but with the advent of mass merchandisers diversifying into the food arena, now you have everybody selling essentially the same types of products — but at varying prices.”

So the channel-blurring phenomenon is certainly having a direct impact on supermarket sales of household cleaning products, in McKinney's view, and that, combined with increased financial pressure on consumers, is affecting supermarket sales of these items.

Scott Harper, VP of marketing at Cinnaminson, N.J.-based Quickie Manufacturing Corp., manufacturer of a wide variety of mops, brooms and other cleaning products, observes that many supermarket operators realize that use of current space must be optimized.

“The incremental impact of ‘me-too’ type products — quite often with over-faced sections and multiple packouts of similar items, has been weak, and retailers are increasingly looking for value-added assortment and meaningful innovation to drive growth,” Harper says.

What Do Consumers Want?

“The category impact from new introductions has been mixed, with too many new items simply cannibalizing sales of current items,” he explains. “Consumer demand for products that improve their quality of life — either through time-saving innovations or products that create a safer home — has been a big influencer, because these are translating into increased category sales.”

Bob McDonald, CEO of Cincinnati-based consumer packaged goods powerhouse Procter & Gamble, made a similar point during an August news conference.

“Our overarching growth strategy is to touch and improve the lives of more consumers in more parts of the world more completely,” he said, noting that there are more than 7 billion people in the world. “We want to reach all of them with products and services that make their everyday lives just a little bit better.”

McDonald outlined new product launches and upgrades he said are helping to drive growth, including Gain hand dishwashing liquid, Downy Unstoppables, Tide PODS and Ariel with microboosters. “These are just a few examples of new products that we'll launch this fiscal year in the fabric category alone,” he said. “We have strong innovation plans across all of our businesses.”

The movement toward laundry tab-type products is a “big trend” moving to the United States from Europe, contends Aero Concepts' McKinney: “It is better for the environment, there is less packaging, and it is a stronger product that uses less water.”

Cleaner than Clean

Other product manufacturers agree that added value is a critical differentia-tor during an economic environment in which shoppers are watching every penny, particularly when it comes to basic products such as cleaning or laundry supplies.

In fact, manufacturers of green laundry and cleaning products contend that their products offer that edge, but they also stress the importance of educating consumers about the attributes of their products beyond their cleaning power.

“I think the green market is here to stay, but this environment has made it difficult,” acknowledges Eric Green, president of Toronto-based Siamons International, manufacturer of the Planet People brand of cleaning products, including iQ_sprays consisting of concentrated refill cartridges whose contents are combined with tap water in a spray bottle.

“Consumers want something that fits their budget, so they typically pick up what's on promotion, a brand that they know,” says Green. “It's hard to compete against that.” But the iQ line, with its claim of high performance based on small cartridges that reduce plastic and landfill by 80 percent, offers the added advantage that's needed, Green contends.

“With the iQ line, we have reduced packaging and, therefore, costs. There are savings in plastic that is used and in transportation, and these savings can be passed on to the consumer. They are not going to buy products just to save the polar bears,” he says.

Bill McConnell, VP of sales at Del-ray Beach, Fla.-based Direct Source Special Products Inc., which makes and sells the Aussan Natural brand of household cleaners and odor eliminators, agrees that added value in such products is of critical importance.

“The perimeter has taken over everything,” he notes. “You see a whole lot going on, but little, if anything, has been done to make the household cleaning aisle a destination. If it's all about price, you can't win at that game.”

McConnell says Aussan Natural products “are more about safety, health and wellness, as well as the environment.” In fact, he contends, once supermarkets convert shoppers to purchasing green products, their ring triples because their consumers then also purchase other higher-priced products.

A recent study from Scarborough Research found that “Super Greenies,” who engage in 10 or more environmentally friendly activities, are some of the most desirable consumers on the planet, even though they account for just 5 percent of all U.S. adults.

According to the study, they are wealthy, with 76 percent likely to have incomes above $150,000 per year and own homes worth more than $500,000. They are also the top spenders in all retail categories tracked by New York-based Scarborough.

Green at Siamons International agrees that those “dark greens” are valuable customers, but says the key target for supermarket operators should be those who are “a lighter shade of green,” consumers who would like to do something better for the environment and the health of themselves and their families, but also need to save money.

“There has to be something in it for them, not just for the abstract planet,” he explains. “You have to be able to show a value product.” That, he contends, is where his company's iQ line comes into play.

Direct Source's McConnell believes that supermarket executives who understand the value of green shoppers and the importance of paying attention to the cleaning aisle as a destination will see sales and profits increase.

“If the supermarket operator grasps this and determines how to become a destination to meet all of the consumer's needs versus this perimeter image, that will change things dramatically,” he predicts. “There needs to be more education about these products. Consumers need to be informed about their efficacy.”

Building a Clean Image

Thus, McConnell would like to see more supermarket operators make use of such resources as in-store marketing to help educate customers. “It helps to have somebody in the store who can provide information and answer questions, because labels can only say so much,” he says. “There are progressive retailers like Publix that tag things and train consumers to trust these products.”

Such a marketing approach can build the store's own image, McConnell advises. “Green moms are more informed, more interested, and they know more about the impact of chemicals in the house,” he observes. “It is just another thing the grocery store can do to say, 'We are supporting the community.' There are the core green buyers and the midlevel shoppers, and that midlevel is growing, and that's who the grocer wants to reach.”

McConnell likes the idea of integrating green household cleaning products with others of their type as a way for consumers to make informed decisions without making a separate trip from the “green aisle” to the cleaning aisle.

“By integrating within the household cleaning section, people have the opportunity to make that choice,” he says. “There is going to be a bigger ring; it's more than just a fad. People are getting the message around their health and their family's health, and that is very important.”

However, Siamons International's Green isn't so sure about that. He likes the idea of participating in combined “spring cleaning” sales events that involve a number of participating suppliers, but believes having a separate green aisle offers significant marketing opportunities for the retailer.

As long as that section isn't too far away from the conventional products, it allows the retailer, Green says, to showcase innovation, and to promote sustainability and a healthy home — all good things to be aligned with as a retailer. “But when it's buried among the Windex and Clorox bleach, it just gets lost,” he cautions.

Meanwhile, Quickie Manufacturing's Harper believes retailers need to take “a tough look” at their product assortment.

“In many cleaning sections now, there is a jumble of products, and the consumer shopping experience is very challenging,” he says. “One of the things we are seeing that has been effective is a 'shop-by-room' approach, where the consumer can easily shop for bathroom, household and kitchen cleaning tools in a more logical way. Then, within the sections, focus on the tool segments and offer variety in only those segments where it is going to offer meaningful value.”

Regardless of approach, it's clear that the shine can be restored to the cleaning aisle with a little innovation, commitment and attention to what's driving consumers' shopping decisions. And, as Harper suggests, make it as easy as possible for shoppers to make their product choices.

That, as they say, is how to clean up.

Mass Appeal

Along with the channel-blurring phenomenon and consumer belt tightening, a further challenge in selling cleaning products is the segmentation of the American shopper, according to Steve Throssel, CEO of Eldora, Iowa-based Whink Products Co. “Just when retailers would like to cut back on their product offerings, the consumer decides they want lots of choices,” he notes. “Our product line is segmented and niched for retail consumer targeting. We have the rust stain solutions, we have the cooktop and countertop cleaner solutions, and we have the plugged-drain solutions. We also have a social commitment to the environment, and we offer organic and environmentally friendly products and ingredients whenever possible.”

To attract these various segments, “all the major cleaning areas, like floor, carpet, kitchen and bathroom, should be addressed” in a store pianogram, Throssel advises. “Our products are designed, via easy-to-read labels and neutral bottle colors, to fit in with any other products on the shelf. The recent investment in colored bottles and exciting label designs and looks by some of the new owners of old companies has us all revamping and upgrading our look. The danger here is that a fancy-looking package can be hard to place in a planogram. To some degree, I want the SC Johnson or Clorox captains to be able to put my products next to any other company's product. We know we're not the only brand in town, and we want to be easy to fit in, and easy for the shopper to locate and understand.”

The key, Throssel says, is to leverage brand loyalty, something his company is expert at. “The brand loyalty that exists today is more valuable than it's ever been, and Whink has a very high brand loyalty factor,” he notes. “We have tremendous promotional programs, and we have an excellent drive-time national radio presence, as well as syndicated game show advertising on television. There will always be a new product coming from us, and we help sell through all of our products.”

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