Innovation reaches new levels

Most people recognize the brand Schick when talking about razors, but what company is behind the production of this brand? The company known as Energizer Holdings, Inc. This company expanded into the personal and household products industry around 2003 and is know owner of brands such as Schick, Playtex Products, Hawaiian Tropic sunscreen and Skintimate shaving gels. Razors for shaving may not seem like a product that too many people care about. Surprisingly though, Schick Hydro did a study which resulted in findings that 75% of men always pack a razor for traveling and 82% think shaving should be an easy part of their on-the-go lifestyle. Because shaving is so important to men, Schick realized that it needed to step up its game and come out with a new razor with new features that would entice men to buy it. Even though our economy is slowly climbing out of the recession, many people are still unemployed or not well off and are therefore looking for cheaper alternatives to everyday products. In order to make a profit, companies have to be innovative and find ways to better their products. Schick introduced the new Schick Hydro Blast razor, available in 5 or 3 blades, which also comes with a travel case, and is meant to “deliver the ultimate skin comfort system.” The senior brand manager for the company said “We want men to experience the difference, and show that they don't have to compromise on a dramatically improved shave – even when they're on the go.” One thing that I thought was interesting is that this article mention that Schick has a Facebook page. This is the digital era and if companies don't jump on board with social media they are quickly going to fall out of the game. The mention of Facebook sparked my interest and the fact that the company is offering a contest with current prizes made me want to read more. Companies need to do everything they can to stay competitive and get consumers and it looks like the Schick brand is doing just that. Their knew product has innovative skin guards, a hydrating gel reservoir, a flip trimmer and a new type of handle to deliver the best shave. 

http://finance.yahoo.com/news/New-Schick-Hydro-Blast-Brings-prnews-2811609873.html?x=0&.v=1

Bringing new ideas to old products

Even though the companies in this industry are the creators of many products that people need and use on a daily basis, they still, at times, find it difficult to keep their profits on the rise. In order to do this, they need to constantly be creating new products that solve problems that people have or that appeal to new interests and tastes of consumers. Despite the recession, people are still buying many personal and household products because there are some things people really just feel they can’t live without. This is very good for our industry because it means the recession has not impacted their sales as much as it has in other industries. However, some companies still feel like they need to be devising new features or products in order to gain profit because there are just so many companies in this industry all competing against one another. Unilever, which makes Lipton Tea, Vaseline, Sunsilk shampoos and other well-known brands recently devised a new product, “Dove Ultimate Go Sleeveless.” This product “claims to make underarms not only odor-free but prettier.” The well-developed companies in this industry know how to compete, they found a product that is extremely popular in the US, deodorant and are bringing a new angle on selling it. After doing a good amount of research, they found 93% of women feel their armpits are unattractive. Based on this fact as well as other results and the fact that deodorant sales are continuing to grow, this company as well as others are trying to bring new innovative takes to well-known products while in some cases also addressing problems that consumers may not have realized they even have. In order to flourish in this market, I’ve learned that you need to be on your toes and constantly coming up with a new idea that meets the most consumers needs. Wherever your company is located, you need to meet the unique tastes of those people as well as making your product attractive and interesting. Marketing your product the right way is how you will get the sales and I think Unilever is definitely on to something here. 

Prices go up, but will sales go up?

A well-known company that we haven’t mentioned on our blog yet is Kimberly Clark and this company is a big player in the household and personal product industry. This company is the producer of brands such as Kleenex, Pull-Ups, Kotex, Scott and Huggies which are well-known products people buy everyday. In addition to producing many well trusted products, Kimberly Clark has the No.1 or No.2 share position in over 80 countries around the world. The brands that Kimberly Clark produces are a very necessary part of life for people all over the world because they are used for health and hygiene. Unfortunately though, the company recently announced that their prices will be increasing in North America which is not something most consumers will be too happy about. The price increases will be focused on child-care and consumer-tissue products and will likely be put into effect in the second and third quarter of 2011. These raises are the result inflation causing commodity prices to increase. The companies raw material and energy costs have gone up which leaves them no choice but to raise the prices of their products, for diapers it will be between a 3 and 7 percent increase and for tissue about 7 percent as well. The company hasn’t been seeing as much profit as it would like so hopefully these raised prices will increase profit and not decrease it. Kimberly Clark has been around for a while and it is known as being a trustworthy and respectable company. The corporate responsibility action plan of this company was recently recognized and the company has won numerous awards regarding it. I don’t think the increase in their product price will have a negative effect on the company because people already known and trust them so they aren't going to turn to a less-known brand, especially in terms of personal products. 

Sources: 

http://online.wsj.com/article/SB10001424052748703818204576206380107721692.html?mod=WSJ_Consumerproducts_leftHeadlines

http://investor.kimberly-clark.com/releasedetail.cfm?ReleaseID=558344

Just a note...

Since I believe we've mentioned Colgate before in a blog or two I thought this would be interesting to mention. I came across an article a few days ago that reports that Colgate is being sued by Church & Dwight Inc. for patent infringement on packaging. Church & Dwight Inc. is claiming that Colgate-Palmolive used a specific type of packaging for their electric toothbrushes that Church & Dwight own the patent for. This packaging lets the buyer test the toothbrush in the store for a couple of seconds and then switches off as to not waste battery. The case will likely go to a jury trial but neither side had any comments at the time of this article. Colgate-Palmolive is a well known and trusted company so I was just wondering how this trial might affect them and their customers. Will they lose customers and trust? Or, will there products gain more attention from the publicity and thereby raise sales? It will be interesting to see which happens. I think that if Colgate knew about the patent infringement and went ahead with their product anyway, it says to me that they need to improve their CSR. If they somehow didn't know about the patent, well then they just need to be more aware, for themselves and their customers.

http://online.wsj.com/article/SB10001424052748704615504576172360509745644.html?mod=WSJ_Consumerproducts_leftHeadlines

How do I know which one to buy????

There are some products most people feel they just can’t live without. One of these is toothpaste. But honestly, when there are so many different brands and different kinds of the same product, how on earth are we supposed to know which kind to buy? Shopping for something that should be easy has instead been becoming pretty overwhelming. However, many manufacturers are realizing this and so last year a reported 69 new toothpastes hit stores instead of 102 like in 2007. One well-known company, Proctor & Gamble, which makes the well known brand, Crest reported significantly reducing the number of toothpaste and oral hygiene products that it makes worldwide in the past couple of years. Matt Doyle, the director of global oral-care research and development at this company said “we’ve come to realize that fewer is better.” In addition to companies cutting down the number of products they are creating, stores are also limiting the number of different toothpastes they are selling. Almost everyone in the US uses toothpaste and they use it regularly which has allowed companies to continue upping the price of this product despite the current state of the economy. Companies are also putting more effort into packaging, such as reducing size or making their product more attractive so that customers are more likely to pick their product from the sea of options. In order to remain competitive companies are stepping up their innovation and investing more in trying to make their current products more attractive, rather than overwhelming customers with more new ones. 

Article used:

http://online.wsj.com/article/SB10001424052748703373404576148363319407354.html?mod=WSJ_Consumerproducts_leftHeadlines

Despite a profit decrease, Reckitt remains a top competitor

If you were to begin talking about the company Reckitt Benckiser PLC, not many people would know what you were talking about. However, if you mention brands such as Air Wick, Veet, Lysol and Clearisil, people have usually heard of these. Reckitt Benckiser PLC is a household goods and personal products company based in Slough, United Kingdom. The company was founded in 1814, currently operates out of more than 60 countries and sells products in over 180. Despite having many different products out on the market that appeal to many different people, last week the company reported having an 8% decline in profit. According to company representatives this is likely due to the status of the economy. It is also likely that because of a slow global economy and growing cost pressures, the company will see little growth in its earnings this year. Chief Executive Bart Becht said “It is a two-world picture. Europe and North America are not doing well, while developing markets are doing well.” However, despite these current profit declines and the stagnant economy, the company still expects to see sales rising in the future. For many years now Reckitt has been at the top of the industry in terms of market capitalization, so they face a lot of competition from other companies. Recently, there have been increases in commodity prices such as oil, palm oil and plastics, which are all big components of many of Reckitt’s products. These rising costs are a challenge for all the companies in this industry because without raw materials, you have no product.  Still, it doesn’t seem like the company will suffer too much as it remains listed as one of the top companies in the industry in many reports. Furthermore, to help with these decreasing profits, Reckitt remains on the look out for possible acquisitions in emerging markets but hasn’t made anything public about any possible ones at the moment. Having so many different products, created by so many trusted names will definitely keep this company afloat and in competition for that so desired spot as the number one country in the industry. 

Sources:

http://online.wsj.com/article/SB10001424052748704858404576134230786079352.html?mod=WSJ_Consumerproducts_leftHeadlines

http://biz.yahoo.com/ic/323.html

Big Profit Increases for Estee Lauder

The cosmetics company Estee Lauder recently reported that its second quarter profit was boosted by 34% thanks to holiday shoppers and a weaker dollar. The company now has a better outlook for the coming year and a higher share-price as a result. Estee Lauder has been around since 1946 when Joseph and his wife Estee began producing different cosmetic products in New York City. The company has since expanded to include businesses in Europe, the Middle East, Africa and China. Because of the current high level of unemployment in the US, chief executive Fabrizio Freda doesn’t see the high profit being sustainable. However, for the time being the company is greatly enjoying the increased revenue. They recently developed new products such as Clinique’s dark spot corrector and thanks to luxury consumers saw an 11% rise in local currencies. To make other profit, Estee Lauder gained shares in department and speciality stores which helped raise their shares to $91.80, up 14% in the NY Stock Exchange. In addition to doing well in the U.S., the company’s international businesses have also experienced large sales increases in the past quarter. Due to China’s booming economy and emerging middle class women who are seeking more makeup products, Estee Lauder sales rose 29%. Revenue growth also results from the company having many products to sell. Estee Lauder owns Clinique, Origins and Smashbox. In terms of economics, the company did have to shell out some money for restructuring charges but demand has been increasing and so sales continue to rise. It seems there is a high demand in the skin care business, followed by makeup and small fragrances. Estee Lauder’s slogan is “bringing the best to everyone we touch” and people are clearly realizing the quality of this company’s products. Even though most of their products are high end and a bit more expensive, consumers are still purchasing them because they want high quality. Estee Lauder may have been around for a while but that doesn’t mean it’s losing any ground whatsoever. It definitely seems like this a company worth investing in.

See the article:

http://online.wsj.com/article/SB10001424052748703652104576122230192422522.html?mod=WSJ_Consumerproducts_leftHeadlines

Snow Shovels and Ethics

At first glance, one may wonder what snow shovels or snow blowers have anything to do with the ethics of the household and personal products industry. However, a closer look will reveal that one can actually reveal a lot about the other. Snow has always existed and has always been something that people have to deal with. It often traps people in their homes, keeps them from getting to work, and ruins travel plans. So what is being done to end this problem of large amounts of snow? Well, nothing can be done to change weather patterns or how could it gets outside, but something can be done about how we deal with the snow that falls. In the past people had two options, shovel the snow or let it melt. Now though, there exist a multitude of snow-clearing machines, such as "the Snow Joe, the Sno-Thro, the SnoBoss, [and] the Sno Wovel." More and more companies are coming up with new ways for people to get rid of snow quickly, easily, and less painfully. As people age, it often becomes more difficult for them to shovel snow, but now there are snowblowers with heated handles, new kinds of snow shovels that are easier to use, and even self-melting driveways and sidewalks for the bigger spenders. Consumers want products that make their lives easier. The household and personal products industry seeks to create prodcuts that consumers will buy and so it is their duty to produce products that will make life easier. It makes sense for them to create products that are helpful to their buyers because then their profits will increase. Rather than worry about creating a product that will cost more and earn them more profit, the industry faces challenges of coming up with products that will help people. One woman, Barbara Krashnack, "bought seven SnoBoss shovels--three for herself and four to give as gifts." The consumers will buy helpful products and they will buy a lot of them. There will be less consequences for the companies to face in the long run if they make better, more helpful products now.

Work Cited: http://online.wsj.com/article/SB10001424052748703954004576089904229906370.html?mod=WSJ_LifeStyle_HomeNGarden#articleTabs%3Darticle