Hair-care offensive: P&G cuts in on Suave price

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Procter & Gamble Co. is going on the offensive against Unilever's Suave juggernaut in the $4 billion hair-care category with a one-two punch, slashing prices on its Pert and Renewal 5x brands and recasting them as midtier value lines. The move follows dramatic sales declines for P&G's VS Sassoon and Physique brands and the company's decision to drop its Clairol Daily Defense line in the U.S.

The once-lowly Suave value brand, nearly discarded by Unilever, is now an enviable hair-care force that after years of consecutive double-digit growth has captured P&G's attention. Beyond its own gains, Suave has become an even bigger threat. It's a "profit center" that has allowed Unilever's Thermasilk to compete more effectively against P&G's premium brands, said Bryan Emrich, brand manager for midtier brands at P&G.

Pert, a brand that has had slipping sales for years, gets its complete makeover starting in June. P&G is pulling the plug on the four-year-old "Sink Boy" campaign from Bcom3 Group's Leo Burnett USA, Chicago, on hiatus since December 2000, replacing it with TV ads from Burnett breaking in September that P&G trade materials claim have the highest "consumer trial potential scores" of any Pert ads in more than seven years. Pert will take on a "light and lively" positioning that harks to before the brand became P&G's first two-in-one shampoo-conditioner product in the late 1980s, Mr. Emrich said.


Pert will also get brighter packaging beginning in July, with products grouped according to hair-care needs as P&G has done with premium brands Pantene and Physique. Following one price cut last July, Pert gets another 20% cut in June, this time to around $2.49 on the retail shelf. Pert volume is already up 6% on last year's price cut to just over $3, P&G said. By comparison, Suave's price point hovers between 99 cents to $1.49.

P&G in June also repositions Clairol's Renewal 5x from Pantene killer-as styled in its launch by Bristol-Myers Squibb last year before P&G purchased Clairol-to value-priced Suave killer.

Currently priced above Pantene at nearly $4 in many chains, Renewal's price will be cut nearly by half to $1.99. It will still be above Suave's price points, but Mr. Emrich said the formulation will be better than Suave's. While less costly than the original formulation, it's "consumer preferred" to the original, he said.

not concerned

Jon Ackenbaum, general-manager, hair and oral care for Unilever, said he expects the P&G moves may hurt other brands in the category, but he's not concerned about Suave. "Suave is not a price brand," he said. "It's got the highest loyalty in the category, higher than Pantene. ... What [P&G is doing] is taking brands that are not really differentiated ... and trying to drive them primarily on price." Suave is handled by WPP Group's Ogilvy & Mather, Chicago. The moves follow P&G's decision to retreat on its Clairol Daily Defense line in the U.S. after it was delisted by major U.S. retailers earlier this year.

Kaplan Thaler handled Clairol Daily Defense, originally launched in 1997 but without media support since 1999 under former owner Bristol-Myers.

Meanwhile, P&G and others are bracing for anticipated entries into the premium and superpremium hair-care categories, including L'Oreal's superpremium Garnier Fructis brand and Unilever's Dove shampoo and conditioner.

Despite a 30.7% sales decline to $51.5 million in the year ended March 24, according to Information Resources Inc., P&G's superpremium Physique will continue to get heavy media support, with TV ads from Publicis Groupe's Saatchi & Saatchi, New York.

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