Could Sale of White Cloud Name Lead to Brand's Resurgence?

Former Partner Walmart Retains Control of U.S. Trademark Baby-Care Category

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BATAVIA, Ohio (AdAge.com) -- The company that took control of the White Cloud brand years after Procter & Gamble Co. discontinued it and helped turn it into a Walmart private label is putting the rights to the brand name up for sale -- albeit for uses outside paper products in the U.S.

Walmart removed White Cloud from its diaper shelves in March, though the brand's training pants, baby wipes and toilet paper remain on sale there.
Walmart removed White Cloud from its diaper shelves in March, though the brand's training pants, baby wipes and toilet paper remain on sale there.
White Cloud Marketing, originally known as Paper Partners, acquired the White Cloud trademark in 1996 and relaunched it nationally with Walmart in 1999, six years after P&G discontinued what was then a toilet-paper brand in a 1993 efficiency move.

The brand logged $600 million in sales last year, according to Carl Marks Advisory Group, New York, the investment bank handling the brand sale.

That, however, was before Walmart removed White Cloud from its diaper shelves in March, though the brand remains for sale there in training pants, baby wipes and toilet paper. The brand got a mere $1 million in measured-media support in 2007 and 2008, according to TNS Media Intelligence.

Walmart and its private-label supplier, Canada's Kruger, have in recent years acquired rights to the trademark for diapers and other paper products, respectively, for the U.S. and will retain those rights, said Peter Schaeffer, principal of the investment bank.

Mr. Schaeffer said the decision to sell the brand was unrelated to the decision by Walmart to remove the brand from its diaper lineup.

P&G sees an opening
That move appears to be a boon to P&G's Luvs brand, which was in a price tier similar to White Cloud's. Luvs has launched a website, whereiswhitecloud.com, and search ads offering Luvs as an alternative to consumers seeking information on what happened to White Cloud diapers.

The sale sets up a scenario where rights to the brand could be owned by three parties in total and sold outside Walmart in other categories by another manufacturer in the U.S. The trademark rights for diapers and other paper products are also available for some some countries outside the U.S., Mr. Schaeffer said.

A spokeswoman for Walmart couldn't immediately be reached for comment.

"The brand has incredible potential," Tony Gelbart, chairman of White Cloud Marketing, said in a statement. "I'm sure that soon after the brand is purchased, consumers will see a significant increase in new White Cloud products on retail shelves. It's a natural for the laundry sector, as well as the personal-care market. I'm certain this brand will exceed the buyer's expectations."

Mr. Schaeffer said the company's consumer tests show "the brand recognition is still very strong, and most people believe we make laundry detergent and soap and dish-wash detergent. ... Most people think you can buy it in a grocery store. They don't realize you can only buy it in Walmart. It's going to be a very interesting play for the right person."

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CORRECTION: A previous version of this story incorrectly identified the location of Carl Marks Advisory Group as Cleveland and the principal as Carl Marks.

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