Laundry Business Embraces Risk

Clorox Doubles Spending to Pit Green Works Detergent Against Tide

By Published on .

BATAVIA, Ohio (AdAge.com) -- A newfound appetite for risk, innovation and share grabs seems to be emerging in what would have seemed the unlikeliest place a couple of years ago -- the U.S. laundry business.

Clorox Green Works detergent

CLOROX: With Green Works detergent, going toe-to-toe with Tide.

Related stories:

Unilever, Walmart, P&G Buck the Short-Term Trend
As Recession Forces Cuts, Leaders Build for Future With Marketing, R&D
What Happens If You Cut Media Spending?
When Unilever, the only marketer with any substantial consumer spending in the category besides leader Procter & Gamble, sold its business last year, it seemed like the game was over. Instead, it's just begun. Henkel is pumping an unprecedented $50 million marketing budget behind its Purex 3-in-1 product. And Clorox Co. is taking what may be a bigger risk still, betting consumers will buy the notion of a green laundry detergent that works as well as P&G's tech-heavy Tide.

With the launch of Green Works detergent, Clorox is doubling its marketing outlay this year on the cross-category green cleaning brand, said one retailer. The lineup will be priced about at parity with Tide, but below other green alternatives such as Seventh Generation. Clorox says it has a patent-pending technology to boost natural detergent ingredients so they're as effective as synthetic ones, and that most consumers don't see any difference in performance between Tide and Green Works.

That it's a big risk was underscored at Clorox's analyst conference earlier this month, when Chief Operating Officer Larry Peiros told analysts, "I don't want you guys to go and get the Procter guys pissed off at us for entering their category, but there is an opportunity. And we think we have the capabilities to take advantage of that opportunity."

The last time Clorox tried to get into the detergent business in the late 1980s, P&G reacted aggressively and Clorox got pummeled. This time, a consumer survey by Consumer Edge Research indicates Green Works could grab a 3% share -- bigger than that of several long-established value brands and mostly at the expense of Tide.

Green Works detergents, along with hiked support behind such brands as Brita, Hidden Valley Ranch and Burt's Bees, are leading Clorox to move from the low to the high end of its 9% to 10% ad-sales-ratio range this year.

In this article:
Most Popular