Seventh Generation Expands Lineup

Despite Boardroom Drama, Brand Is Rekindling Growth With New Products

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Many marketers talk about getting back to their brand roots after a stumble in the marketplace. For Seventh Generation, that roots movement is all the more interesting, considering that the company fired founder Jeffrey Hollender less than two years ago.

Today, the green-cleaning and personal-care megabrand is undoing some of what has happened since 2009, when the company adopted a more mass-market approach.

Under new CEO John Replogle, a veteran of Burt's Bees, Seventh Generation is putting a renewed focus on what its name really means. (It comes from the great law of the Iroquois nation, which held that deliberations about every decision would take into account the impact on the next seven generations.)

It is unleashing a slew of products that will increase its already-hefty item count by more than a third, to 240. And it's preparing in August to launch an "Inciteful Insights" campaign from Colangelo in Darien, Conn.

The push will run primarily in digital and social media. Along with revamped packaging, it will call attention to the proportion of bio-based (as opposed to petroleum-based) ingredients in Seventh Generation's products to help point out what natural products are all about, said CMO Joey Bergstein.

Preceding the revamp and what appears to be a nascent rebound, Seventh Generation had more than its share of boardroom drama for an eco-minded company based in pastoral Burlington, Vt.

Mr. Hollender's successor as CEO, former Gatorade executive Chuck Maniscalco, offered his resignation in late 2010, a little over a year after taking the job. Mr. Hollender, who had remained as a board member, was then forced out by the board, which had just secured $30 million in private-equity capital. The board then hired Mr. Replogle, a Unilever veteran who helped sell Burt's Bees to Clorox Co. and stayed on to run the business under its new owner. 

Mr. Hollender declined to comment, and Mr. Maniscalco, now VP-strategic initiatives at Champlain University in Burlington, didn't return calls or email for comment. But Mr. Replogle said that "Jeffrey Hollender did a wonderful job of creating and sustaining a vision that made it a lot easier for me to step in and figure out a strategy for the next generation of Seventh Generation."

"Anytime you lose ... a founder, an organization goes through a period of introspection," he said. "I was kind of fortunate in that it was almost parallel to the situation I came to at Burt's Bees. ... I followed the CEO, who followed the founder in both situations."

Mr. Replogle said he believes Seventh Generation got off track in part because it focused too much on mass media-TV advertising.

The new emphasis, said Mr. Bergstein, is on digital and social media aimed at interaction with the brand's often-fervent following. There's also a shift away from print in the coming campaign.

Appearances aside, Mr. Replogle said he's not out to flip Seventh Generation a la Burt's Bees. Unlike Burt's Bees, Seventh Generation has "patient capital" that 's not pushing for a quick sale, he said, adding that other stakeholders in the business, including employees, have the final say.

Seventh Generation is in it for the long term, Mr. Replogle said. As in really long term, which is where the roots revival comes in. "Our mission is to create a consumer revolution that cares for the health of the next seven generations," he said. "We do define ourselves as a health company, with the firm belief that you can't live a healthy life on a sick planet."

The new Seventh Generation team is also out to rekindle growth. It's been lagging design-focused competitor Method in recent years despite a green-packaged-goods market that 's generally been outgrowing the mainstream business.

Those efforts seem to be working. Amid management transition last year, Seventh Generation's sales grew 2%, to $82 million (not counting Walmart, where it's also distributed), as many of the categories where it competes shrank, according to SymphonyIRI data.

For the 12 weeks ended April 15, Seventh Generation's growth accelerated. It was up 15% vs. the year-earlier period, to $20 million. That increase came as Seventh Generation focused marketing efforts on a tie-in with Universal's "The Lorax."

Mr. Bergstein acknowledged the film's brand tie-ins generated some backlash among green consumers who thought Universal was selling out to corporate interests. But he said he thinks the Dr. Seuss book and movie are perfect fits with Seventh Generation and that the promotion appeared to bear fruit for the brand, even if it had some explaining to do to some fans.

A message on Seventh Generation's website defending the use of the Lorax character on the brand's diapers said the licensing deal wasn't "intended to directly market the movie itself. ... We simply thought it would be a fun way to encourage family reading and environmental awareness while creating a few smiles."

While the deal attracted detractors on Seventh Generation's Facebook page, Mr. Bergstein said it got at least equally strong defense from other fans of Seventh Generation and "The Lorax."

"It was controversial, but for us it was successful," Mr. Bergstein said. "In terms of market share, Q1 was the strongest quarter we've had yet." Seventh Generation's "Lorax" hashtag also became a Twitter trending topic twice and was well received by mom bloggers, said Seventh Generation spokeswoman Brandi Thomas.

More broadly, green household products are enjoying a rebound. Much of the category's growth comes not from hardcore dark-green consumers but less-committed "light-green consumers making better decisions," Mr. Replogle said.

"The big question for us is , "How do we broaden the story beyond just being green?' " Mr. Bergstein added. "Our team has done a great job in recent years really upgrading the performance of these products so people don't think they have to make a tradeoff."

As part of the brand's biggest product expansion perhaps ever, it's rolling out more than 60 items, such as a superconcentrated laundry detergent packaged in recycled cardboard and lines of baby-care products. There's also laundry and cleaning products designed for use around infants—a major consumer need that 's underserved, Mr. Bergstein said.

Those roots, they keep bearing offshoots. Though gone from Seventh Generation, Mr. Hollender is not forgotten. In the Triple Pundit blog, he recently lashed out at Walmart, one of the brand's biggest customers, for alleged foot-dragging on sustainability.

Mr. Bergstein said the brand's relationship with Walmart remains strong.

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