P&G To Launch Stronger Detergent In Smaller Packages

Bowing to pressure from retailers like Wal-Mart to squeeze more product onto shelves, Procter & Gamble is readying an autumn launch of double-strength laundry detergents in packages that are half the regular size.

Starting in the fall, the packaged goods giant will replace all its $4 billion liquid detergents portfolio in North America, which includes such brands as Tide, Gain, Cheer, Era and Dreft. It will start in the southern U.S. and Puerto Rico in September and complete the full conversion by April in the Northeast and Canada.

Known within the Cincinnati-based company as "Tide 2X," the project is being touted via press release as an environmental "breakthrough" because it uses up to 44% less water and at least 22% less packaging. (The issue of recycling or discarding more, albeit smaller plastic bottles was not addressed.) That may be part of the selling proposition P&G uses in advertisements that will try to convince consumers that they are getting the same product for the same price.



P&G's liquid detergents dominate in the U.S. with a market share of more than 60%, led by Tide. P&G's largest customer, Wal-Mart, has been pushing suppliers to cut packaging by at least 5%.

The company will face higher costs with the introduction of the new products, including converting its packaging molds, in-store materials and higher marketing costs.

In 2005, P&G's top competitor, Unilever, launched its more highly concentrated liquid detergent "Small and Mighty" in the U.S. Unilever estimates the product reduces packaging by more than 40%, water usage by about 60% and shipping volumes by 60%, according to published reports.

Unilever has a comprehensive advertising and promotional program with TV, print, outdoor, online, product samples and couponing designed to reach consumers "looking to make life just a little bit easier in their time-pressed daily schedules," according to RetailWire.

A major component of that program is driving awareness and trial in-store. Supporting the effort are in-store displays in floorstand/mini pallet and PDQ tray formats; educational signage, including shelf strips, cap comparison signage, sign dangler, bottle dangler, flagpole and spring-loaded shelf tray; on-pack stickers, and account-specific options, such as Floorgraphics and take-one coupon boxes.

P&G tested the concept in Cedar Rapids, Iowa, for six months within the last year. Consumer awareness of the compacted products there reached 65% in the first 12 weeks of the test market effort, indicating that consumers would be receptive of the shift to concentrated detergents, the company said.

"We were very energized by the positive results of this test market," said Paul Vraciu, P&G fabric care brand manager, in the press release issued yesterday. "After our testing, we now understand that with the right education and communication around 2X concentrated products, our consumer will welcome this change."

The compacted formulas and smaller bottles allow for increased efficiency across the entire supply chain, including reduced fuel consumption and warehouse space usage, the company said.

"We view sustainability as an opportunity and stimulus to innovate, to improve consumers' lives, while also making important contributions to environmental quality and society," said Peter White, director of corporate sustainable development, in the same release.

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