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Clean Up On Aisle Ten

Private label household cleaners have an opportunity to gain dollar and market share in retail

BY MOLLY V. STRZELECKI



As the old saying goes, “If you’ve got time to lean, you’ve got time to clean.” And while household cleaners are leaning toward a flat to down market these days, now has never been a better time for private label to clean up when it comes to gaining market and dollar shares.
For the 52 weeks ending Nov. 27, 2011, the overall household cleaners category declined 1.4 percent, according to Chicago-based SymphonyIRI Group. For private label products, the decline was slightly less than 1 percent, showing a huge opportunity to gain ground.
“Corporate brands continue to gain traction,” says Paul Shilling, vice president of sales for Clearwater, Fla.-based Ameriplus. “The trade is very meticulous about making sure their corporate brand is national brand equivalent or better, and because of that, consumers can go to the shelf and be assured that they’re getting equal to or better than the national brand. If they can do that and save money, then we win.”

WIPING UP THE COMPETITION
Fresh and citrus scents are still dominant fragrances for cleaning products, notes Sue Braun, product manager for Rockline Industries, Sheboygan, Wis. But overall, products with a disinfecting component are what continue to strike a chord with consumers.
“Disinfecting wipes continue to see nice growth,” Braun says. “They are not only convenient, but also provide a valuable benefit in killing germs.”
These wipes, Braun adds, are no longer relegated to kitchen or bathroom use, but becoming a staple throughout the house. “They've also become a supply item on the back-to-school lists.”
Wherever they may be needed, cleaning cloths have shown good growth, according to the SymphonyIRI data: private label household cleaner cloths showed 3.8 percent growth for the 52 weeks ending Nov. 27, bringing category sales to $48.5 million and sweeping up 18 percent of the total dollar sales for the category.
Shilling agrees that disinfectant products are the hot item in household cleaners these days. “Consumers are a lot more conscious of disinfection with all the hype that’s been given to the flu virus. Disinfection is the thing consumers have had their eye on that maybe they didn’t quite as strongly before.”
Additionally, concentrates and PODS, or water-soluble packaging, have also popped up on the private label manufacturers’ radars, notes Steve Berry, “The Green Guy” for Auburn Hills, Mich.-based Greenblendz, Inc. “Controlling doses is the new goal to manage rising raw material costs and this POD innovation will do both.”
While many private label categories have seen a perceptible uptick in products that are natural or organic, not so with household cleaners, experts say. The market, quite simply, is there, but certainly not robust.
“There are still some requests for organic and natural products,” says a spokesman for U.S. Nonwovens Corp., Brentwood, N.J., “but the low volumes prevent much effort or growth in this category.”
Retailers are cautiously reducing their offerings in the natural niche, Berry says. “It’s not as hot as it was three to five years ago.”

DON’T BREAK THE BANK
An economy that has been down and is just now sparking some growth has pushed consumers to scale back on their purchases in more ways than one. Not only are consumers looking for products at a lower price point that still deliver on quality, but they’re also looking to reduce the number of products they are using-something that is directly affecting sales of household cleaners.
“There are a few segments within household cleaners that have shown decline,” Braun says, citing furniture and glass wipes as examples. “They are not a priority and many other options exist in those segments.” Old standards of a spray cleaner with a cloth rag are one such option.
Over the years, household cleaner manufacturers have segmented the category into several subcategories, with products reaching out to every cleaning need consumers could dream. But in today’s soft economy, “Consumers are buying one cleaner that has more than one purpose,” says Shilling. “Manufacturers are coming out with products that will clean everything from countertops to toilets. They’re providing products that are all-encompassing and they get the one sale.” Consolidating purchases into one type of product for different uses, Shilling notes, has caused some contraction in the category.
And the numbers would agree. All-purpose cleaners overall were down 1.9 percent, according to SymphonyIRI data, but other staple products, like private label scouring pads and furniture polish, were up 6.6 percent and a whopping 25.3 percent in dollar sales respectively. Back to basics in a lean economy can really put some polish on the category, experts agree.

A SPOT-SHINE FOR THE FUTURE
With much room to grow, private label household cleaners can really put a shine on the category-if they are careful.
“In the corporate brand world, household cleaners are a very strong segment,” Shilling says. “Now, when chains put out a private label program, they are more interested in making sure it’s something that identifies them, and the quality is national brand product quality.” Retailers that continue to market their line as a brand rather than simply a product will continue to be successful, he adds.
Focusing on value, innovation and differentiation from the national brands will also help spur growth, says Berry. “Retailers need to act and market like a national brand, not a national brand equivalent at a lower price.”

SIDEBAR:

Eye On The National Brands
When it comes to household products, recent concerns about the efficacy of natural and organic products, on top of their higher price point than many offerings, has caused hesitation on the part of consumers. And the green household cleaner category hasn’t been a money maker for private label manufacturers.
However, consumers are starting to put some faith back in the national brands’ green offerings, and some green household cleaning products continue to fare quite well, according to a recent Euromonitor International, Ltd. report. Seventh Generation and Method products, for example, had a good rebound, the report noted, and “consumer demand for green household care products grew steadily.” Additionally, toilet liquids, a high-performing category in toilet care, declined only slightly (less than 1 percent) part of which was helped by “a resurgence of green products…which saw growth as a result of wider retail distribution and renewed consumer interest in green product options.” In 2010, according to a Euromonitor report on bleach in the United States, chlorine bleach sales declined 7 percent overall to $543 million.
Brand leader Clorox played a big part in this, as the report noted, “Clorox is practically synonymous with chlorine bleach, through its eponymous brand, but saw its 63 percent value share decline at the hands of cheaper private label products.”
Recently Clorox rolled out a new high-efficiency bleach gel for toilets. New products equal a new opportunity to capture consumers that may have defected to the siren song of private label, particularly if the new product has no private label equivalent.

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