NEW FILTERS IN STORES
Culligan recently introduced a line of water filters that garnered orders from such powerful retailers as Dayton Hudson Corp.
Culligan President-CEO Douglas A. Pertz is promising a $4 million national ad budget, Culligan's first since the early '80s. Three TV commercials and four radio spots are now airing, via Grant/Jacoby, Chicago.
But some three-dozen water filter marketers have failed in efforts to crack retail channels over the past decade. Profit margins are significantly thinner than in the water softener and bottled-water businesses for which Culligan is best known.
NOT AN EASY BUSINESS
"This business looks easier than it is. I've watched a lot of competitors come and go," said Charles Couric, president of Brita Products Co., a division of Clorox Co. that claims 85% of sales in the filtered-water carafe category, which Culligan is attacking with a product in partnership with Health O Meter Products.
Nevertheless, nobody doubts the power of Culligan's brand. According to surveys, at least 90% of Americans connect the Culligan name with water treatment.
"Clorox has done a fabulous job in getting Brita established," said Peter Howell, chairman-CEO of Health O Meter. "But Culligan is absolutely the very best brand name in water filtration."
Barry Mannis, an analyst with Goldman, Sachs & Co., pegged the retail filter market at $275 million at the wholesale level, with nearly 12% annual growth.
Mr. Murphy is a correspondent for sister publication Crain's