There’s no doubt that unit dose technology makes it easier for consumers to do laundry. No measuring, no mixing, no laundry room alchemy of any kind. Similarly, the technology has provided a lift to older and handicapped consumers who find it difficult if not downright impossible to lug a jug to the laundry room or down into the basement. Whether young or old, it’s clear that consumers love the convenience inherent to the unit dose format.

Sales of Pods, Pacs, Flings and the like soared nearly 26% to more than $796 million in supermarkets, drugstores, mass market retailers, military commissaries and select club and dollar retail chains for the 52 weeks ended Nov. 2, 2014, according to Infoscan Reviews, IRI (see chart).

“Price and convenience continue to be deciding factors for laundry detergent,” explained Anne Candido, fabric care communications, P&G.  “Consumers value the fool-proof, all-in-one idea of unit dose.”

When it comes to a convenient way to do laundry, there is bifurcation in the market, agreed Ed Vlacich, executive VP-national brands, Sun Products. He noted that even cash-strapped consumers want to purchase higher cost-per-load innovations like unit dose detergent packs.

“They see the value of getting something clean the first time, and the convenience that packs provide. Plus, there’s the cache of knowing that they have the latest innovation in their laundry basket.”

Some Forms Suffer
Unfortunately, gains made in unit dose haven’t carried over to the entire laundry care category. For the same period, total category sales dropped 2.6% to about $6.8 billion, according to IRI. Taking a closer look at product formats, liquid laundry and liquid fabric softener sales each declined more than 3%, and their poor cousin powder continued its precipitous sales decline, tumbling 14% to a tad below $870 million.

“We see polarization (in the laundry category), with pods doing well,” observed Ian Bell, Euromonitor International.

Bell pointed out that private label isn’t doing as well as one might expect in a value-based market. He attributes that with big players coming with a value proposition of their own.

For example, he noted that P&G’s value-priced Tide Simply Clean and Fresh bears a striking resemblance to Church & Dwight’s Arm & Hammer brand. According to IRI, Church & Dwight is on the only top five player in food, drug and mass to eke out a gain in the liquid laundry category, with a .55% increase for the 52 weeks ended Nov. 2, 2014.

The category has been battered by price wars that have eroded overall sales and ultimately could impact innovation.

“It is tougher than it’s ever been,” insisted Vlacich.  “It’s been very competitive during the past year and the category has been heavily discounted.”

He noted that through mid-October 2014, the category was flooded with more than $10 billion worth of coupons, an increase of 17% over the previous year. More than $7 billion of that came from just two brands, Vlacich added.

Harried & Worried
“The economic landscape has certainly impacted home care and all CPG categories,” agreed Steve Johnson of Information Resources, Inc., who spoke at the Cleaning Products 2014 Conference. Although the Great Recession was followed by several years filled with positive economic momentum; i.e., rising stock prices and falling unemployment rates, about 40% of US households feel challenged by today’s economy—heck, even 30% of households with incomes of $100,000 or more feel stressed about the economy.

Johnson expects economic concerns and consumer stress will continue through 2020 and, as a result, he predicted that gains can be made in the underdeveloped private label segment of the laundry care category. He pointed out that while private label commands 17.6% of total store sales, it accounts for just 7.7% of home care sales (vs. 22.1% for general merchandise and 23.6% for health care sales). More specifically, private label accounts for just 2.5% of liquid laundry detergent sales and 4.0% of fabric softener sales. Even worse, sales of private label liquid laundry detergent slid more than 12%, according to IRI data.

On the flip side, private label represents the fastest growing segment in the home care sector, with a compound annual growth rate of 4.6% vs. 2.8% for the total store; bleach and fabric softener sheets are two of the best performing product types within home care private label. If that news wasn’t bad enough for national brands, Johnson noted that one of the biggest beneficiaries of the move to private label just happens to be the biggest retailer on the planet. In fact, Walmart and Sam’s Club private label sales have posted 12% CAGRs since 2011, while all other retailers report an 0.7% decline.

Do these statistics spell doom for national brands? Not at all, insisted Johnson.

“Brands are bringing value to consumers in fundamentally different ways,” he said, noting the success of products such as P&G’s Tide Pods and Downy Unstopables. Johnson pointed out that brands can bring value not based on price, by offering multipurpose and/or sustainable solutions.

“Innovations that work deliver on three key trends,” he explained. “Simplicity, wellness and excitement.”

On Target
The retail landscape is littered with losers—think Sears, Best Buys and Staples—all of which have been unable to adapt to changing consumer tastes and values. And while it’s had its share of missteps over the years with shopper identity theft and a poor online presence, Target remains a leader in the private label space through its Up & Up brand, which is available in more than 50 categories including laundry care.

According to Tom Flicker, principal product engineer, Up & Up, the brand helps drive consumers to Target, while boosting sales and earnings.

“Guests (customers) love them,” insisted Flicker, who noted that Target has 20 own brands and that Up & Up does $2 billion in sales on its own.

“Target sees private label and national brands as working together to drive business,” explained Flicker. “We need national brands to grow the categories as we grow our brands.”

He explained that when it comes to product development, Target develops the product first, considers the cost second and tests products just like national brands.

“If we can’t exceed a national brand then we don’t launch it,” Flicker maintained. “If an Up & Up diaper leaks, then we know the consumer won’t buy our trash bags (or other private label products).”

Consumer research convinced Target to develop products that stand out from the competition.

“If our products are too similar to national brands, then consumers don’t see us,” he explained.

And while Flicker acknowledged that national brands own the laundry detergent aisle, that didn’t stop Target from developing Up & Up laundry detergents after extensive research that included asking test subjects to keep diaries on tough stains.

“Target guests have different kinds of stains,” he maintained.

The Tide Turns
One of the reasons why private label has had such a tough time making headway against national brands is because Tide, Gain and the rest do such a good job of protecting their turf from imitators.

“The laundry market continues to be highly competitive,” agreed Candido. “Tide will continue to compete by offering the consumer value added innovation that truly delivers.”

For example, P&G is rolling out an Unstopables megabrand in January 2015 that will include a suite of home care products to join the in-wash scent booster, and the following month, Tide will introduced a new pod innovation. Meanwhile, P&G will introduce a new fragrance variant, Botanical Mist, to its Infusions line.

Candido noted that the category continues to be highly competitive due to promotion activities. However, Tide is growing share and household penetration. 

 Vlacich predicts that consumers will return to national brands as oil and gas prices continue to drop throughout the US. And Sun’s All brand will reap the benefit. In a 2014 Consumer Reports’ study, All Mighty Pacs provided the best performance among single-dose laundry detergents, according to the Sun executive.

“It’s been a great year for innovation for us,” insisted Vlacich. “We had a couple of new products that reinforced our reputation for innovation.”

One of them was All Free Clear ultra fabric softener for sensitive skin. It is the No. 1 detergent brand recommended by dermatologists. Another is All Small & Mighty Superconcentrated, which provides 30% more loads than the old formula. Finally, Sun introduced Snuggle Scent Booster in two fragrance variants. The unit dose format combines convenience with two fragrance options.

Ready to Wear?
If grass and food stains aren’t enough for formulators and suppliers to worry about, Kim Scheffler, director of garment development, Adidas, warns that the next generation of active  wear—commonly called smart garments—may have as many wires, processors and modems as a cellphone. There are already heatable garments from companies such as WarmX; clothing to monitor heart rates, such as Fibretronic’s ConnectedWear; and even illuminated hoodies, shirts, skirts and jackets from a variety of designers and clothing companies.

More advanced garments obtain a signal from the body, rely on electronics to move data around and transform it into information and include interfaces to share the results with users. High-tech clothing, for sure, but they create unique problems for Adidas researchers and ultimately, the fabric care industry.

“There is a lot of corrosiveness in sweat,” explained Scheffler. “Durability and washability remain barriers to smart garments.”
She’s asking for industry to come up with answers to several questions, including:

• Are there cleaning products compatible with epoxies and silicone sealants?
• Are there recommendations on sweat-resistant moisture barriers?
• How about better options on freshening agents?

Clearly, many wrinkles must be ironed out before smart garments replace that favorite Van Halen T-shirt as workout garb. The industry, too, faces plenty of issues that must be addressed, noted Ernie Rosenberg, president of the American Cleaning Institute.

Issues to Iron Out
According to Rosenberg, there’s a great chance that the Toxic Substances Control Act (TSCA) will be modernized in 2015. That’s the good news; the bad news is that states and local communities continue to develop their own versions of chemical regulations in place of a new TSCA.

“We expect real movement on TSCA early in the session,” predicted Rosenberg. “But it has to have bipartisan support. To be characterized as an improved TSCA, it has to have the right people on board.”

With the right lawmakers behind it on both sides of the aisle, Rosenberg said TSCA will have the credibility to help dampen activity by NGOs and retailers alike.

“We have a narrow window to make a move before the Presidential silly season gets underway,” explained Rosenberg, referring to the 2016 Presidential Election process, which seems to capture the attention of lawmakers earlier and earlier.

Away from Capitol Hill, ACI is moving forward with its cleaning product ingredient initiative. In 2015, the Association will add exposure information on top of hard data sets; ensuring that the ACI and its members are going further than other industry, Rosenberg insisted.
ACI also issued an analysis on enzyme management and sensitization at member companies’ facilities around the world.
“Those facilities that followed our guidance saw diminishing low levels of allergy symptoms. That convinced us that we are on the right track,” explained Rosenberg. “Facilities that follow the guidance had minimal if any allergy problems.”

Rosenberg was quick to point out that in use, enzymes are not a concern.

ACI also conducted a surfactant review spanning five decades and concluded that, as used today, surfactants don’t present any health problems. Rosenberg estimates that the industry has spent $30 million ensuring surfactant safety.

“This is an industry that takes the safety of its products very seriously,” he told Happi. 

In 2014, ACI expanded its iSTREEM web-based computer model to include the Great Lakes and Canadian watersheds. iSTREEM  predicts the concentration of a chemical used in “down-the-drain” products at the discharge of more than 10,000 wastewater treatment plants, at the intake of 1,700 downstream municipal drinking water treatment facilities, and in approximately 30,000 river reaches covering over 200,000 river miles across the continental US.

“We are not just a lobby shop; we are a science shop,” observed Rosenberg. “We spend more time on the sustainability side of the business than we do on the advocacy work. We have five people in our technical department and three in government affairs.”
He added that ACI member companies are involved in a wide array of projects to reduce the environmental footprint of their products, as well as ensuring the safety of its products.

One of its biggest product safety programs is the two-year-old Be the Key pledge to ensure that consumers are safely storing unit dose detergent packs to avoid accidental ingestion by children. At press time, more than 50,000 people had taken the pledge and ACI is devoting another $500,000 in 2015 to get the word out about the importance of correctly storing unit dose detergent packs.
Just last month, ACI teamed up with the Coin Laundry Association (CLA) to help keep children safe and prevent injury. According to industry statistics, seven million consumers head to laundromats every week. The collaboration brings together ACI’s expertise in consumer education and CLA’s influential membership base of laundromat owners across the country.

“ACI is pleased to announce this partnership with the CLA as we work together to prevent accidents when laundry is done outside the home,” said Nancy Bock, senior VP-education, ACI. “Children act fast and so do accidents, so we are urging laundromat owners, staff and the public to keep liquid laundry detergent packets away from children.”

Indigestion over Ingestion
While ACI is taking the lead on the accidental ingestion issue surrounding unit dose packs, P&G has been making changes of its own regarding packaging design, labeling and in information campaigns, noted Candido.

Tide Pods’ packaging is now opaque so the detergent packs cannot be seen. P&G added a triple-latch lid to the container and at the end of last year, introduced a new zipper seal for its bag version.

“These changes make it more difficult for smaller, younger hands to open, while still providing access for adults and enabling them to re-close the package with ease,” explained Candido.

P&G enhanced the safety warnings and their prominence via icons and printed instructions on the package to make it very clear that these products should be stored out of the reach of children.

“These messages appear not only on our packaging, but also in our TV and print advertisements, our website, and all of our communications representing Tide Pods,” explained Candido. “We’ve also worked with retailers to enroll them in sharing this information with their shoppers at the shelf.”

P&G launched Safe Home, which has been promoted through various media outlets to drive home safe home care practices, especially in the laundry room. As part of this effort, P&G has given away more than 617,800 cabinet latches and thousands of consumers have seen the information online.

Within the medical community, P&G partnered with the American Academy of Pediatrics to inform pediatricians and parents about the safe use of detergent packs. Together, child-proofing brochures help parents create a safe home environment where all household cleaning products are stored out of reach of children.

“We distributed a laundry pack safety poster to AAP pediatricians for display in their offices. We’ve also provided information in AAP publications and social media channels (HealthyChildren.org),” noted Candido.

Finally, P&G is supporting the development of a voluntary international standard for safe packaging, storage, and handling of detergent packs. The company has been actively involved in the development of a new packaging and storage standard for laundry packs with the Consumer Product Safety Commission and European Commission, according to Candido.

What’s Ahead?
While the industry and its association tackles the issue of accidental ingestion head-on, even as they grapple with each other and private label brands on-shelf, they’re not overlooking innovation. At press time, neither Sun nor P&G were ready to divulge all of their new product launches for 2015. But both are confident that they will delight consumers and retailers with their new offerings.
“Retailers are sharp; they’ll make room for us,” predicted Vlacich. “They’ll take room away from powders and reduce shelf space for redundant brands. We try to self-prune our offerings, but retailers know that they can always take shelf space away from the bottom third of SKUs.”

It’s a brand-eat-brand-eat-private label world out there on laundry detergent shelves; survival of the fittest doesn’t just refer to species, it describes detergents, too.

Get Ready for the ACI Annual Meeting • The global detergent industry will head to Orlando later this month for the American Cleaning Institute’s Annual Meeting & Industry Convention, which will be held Jan. 26-31, 2015 at the Grande Lakes Orlando. The theme of the event is “The World of Cleaning in One Convenient Place,” which is an apt theme considering ACI’s Annual Meeting & Industry Convention attracts hundreds of executives up and down the supply chain. In 2014, the event attracted nearly 900 attendees and at press time, registration was ahead of last year, according to ACI. “Our members tell us that they can save a lot of business trips by being able to plan plenty of meetings on sales, product planning and strategic alignment,” explained ACI President Ernie Rosenberg. “It gives suppliers a chance to discuss new technology with key customers.” Besides the opportunity to conduct important meetings with key customers, the ACI Annual Meeting & Industry Convention delivers the news its members need with several informative sessions including: A global industry update with international association executives; A presentation by Fisk Johnson, chairman, SC Johnson; A panel presentation, “From Innovation to Collection, Public Policy and Consumer Packaging;” A Women’s Networking Forum entitled, “Lessons from the White House—Women in Leadership;” and A breakfast session featuring Jack Uldrich, a futurist and expert on global trends. Plus, the event will include a presentation by former Presidential candidate and Massachusetts Governor Mitt Romney. In his talk, “Keeping America Strong,” Romney will share insights on the current political environment and business today, as well as his ideas on the future of the nation, focusing on solutions to the debt, private sector growth, education and immigration, according to ACI. The ACI Annual Meeting & Industry Convention will also include an array of social programs, such as a Fun Run, President’s reception and closing reception. There will also be opportunities to support Cleaning for a Reason through the Quack for a Reason Charity Duck Race and participate in building Clean the World ONE Project Hygiene Kits. More Info: www.cleaninginstitute.org