Commentary

Kimberly-Clark Promotes Hsu To CEO After Rebranding 'Mansize' Tissues

Kimberly-Clark yesterday named Michael Hsu as CEO effective Jan. 1 and said that longtime CEO and chairman Thomas Falk will become executive chairman to “ensure a smooth transition” for the marketer of brands such as Huggies, Kleenex, Scott, Kotex, Cottonelle, Poise, Depend and Pull-Ups.

“Hsu, 54, joined Kimberly-Clark in 2012, and has been a career consumer products executive, working with some of the most well-known American brands.  At Kraft Foods, Hsu was executive vice president and chief commercial officer. Previously at H.J. Heinz he was vice president of marketing for Ore-Ida and frozen meals,” writes Maria Halkias for the Dallas News.

Hsu had been president and COO of the Dallas-based Kimberly-Clark since January 2017. He launched his career as a consultant with Booz Allen & Hamilton, where he rose to partner in the firm’s consumer practice, according to the K-C release announcing the moves.

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“The change at the top comes at a time when the consumer goods industry is under pressure from rapidly changing tastes, intense competition and rising costs. Earlier this year, the company said it would cut at least 5,000 jobs as part of plans to reduce expenses by as much as $550 million,” Alistair Gray writes for Financial Times.

“The company has been hurt by factors from the rise of ecommerce to higher commodity costs. A declining birth rate, which has reduced demand for nappies, has added to the pressure. Shares have lost 11% this year,” Grey continues.

The company also reported yesterday that third quarter 2018 net sales of $4.6 billion decreased 2% compared to the year-ago period. On a conference call transcribed by Seeking Alpha, Hsu said: “The overall environment remains challenging, especially with commodity inflation and currency volatility.” The company said it would further cut its earnings guidance for the full year. Shares tumbled afterward, Bloomberg’s David Caleb Mutua reports.

“Mr. Hsu said the company will focus on selling its more popular items, as well as introducing a mix of larger packs to offset weaker categories,” Kimberly Chin writes for the Wall Street Journal.

There’s a bigger picture to be drawn by Falk, 60, stepping down as CEO, as Lauren Silva Laughlin writes for Reuters BreakingViews: “Company bosses’ shelf lives are getting shorter. Thomas Falk is stepping down as chief executive … after 16 years, following in the recent footsteps of longstanding bosses at PepsiCo and Campbell Soup. It’s a sign of accelerating executive turnover at consumer-goods and industrial companies.”

According to an Equalar report, Laughlin adds, “between 2015 and 2017, the average chieftain’s tenure in the [consumer-goods] category has fallen by nearly a year, to five years; for [industrial sectors], it has fallen by a year and a half, to just under five and a half years.” 

Give those deposed titans a new Kleenex Extra Large. In fact, this is all coming on the heels of K-C rebranding its “Mansize” tissues last week.

“Kleenex Extra Large will take to the shelves in a unisex sales push amid mounting criticism of the choice of wording, a hangover from the 1950s when the brand first launched ‘Kleenex for Men’ as an alternative to large cotton handkerchiefs,” writes John Glenday for The Drum. “Continuing that tradition the outsize hankies are claimed to be ‘comfortingly soft and strong so you can be confident it won't let you down,’” Glenday continues.

“Mansize … hit store shelves 60 years ago in the United Kingdom, the company said, pitched as a disposable alternative to large cotton handkerchiefs popular at the time. It’s only sold there since,” Josh Hafner reports for USA Today. Indeed, the Telegraph’s Katie Morley says it's the “most popular” tissue sold in the U.K.

There’s a lesson to be learned here, too, Cassie Werber tells us in Quartz, and it has nothing to do with “Mansize” Kleenex being saddled with the outdated thinking of copywriters who wore buttoned-down white shirts, ties and Oxfords to work.

“The original moniker was somewhat euphemistic (‘What are you using those for, guys?’) and somewhat nonsensical, implying as it did that all men have bigger noses than women. It was also 60 years old, and thus an early departure from simply calling a product what it is -- in this case, large tissues. Today, that kind of non-functional labelling has mushroomed into an outright trend, as brands celebrate, perhaps a bit too enthusiastically, the era of the adjective,” Werber writes.

Holland & Barrett, a European health-food store based in Britain, sells “Curly Cashews,” “Awesome Almonds,” and “Winning” linseed, for example.  The U.K. is leading the trend, freelance strategic marketing consultant Joanna Chekroun tells Werber, “but others are following suit.” French retail chain Monoprix sells a sandwich with a label that translates to “The only club in Paris without a dress code,” to cite one.

Thank goodness we are not told more than we perhaps need to know on this side of the pond, right?

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