Claire Beaton's biography (document anglais)

CleanSpritz

- Claire Beaton convinced a concentrated version of CleanSpritz would slow continuing sales decline.

- 5 consecutive years of sales decline, average rate of 7.5%

- Loyal customers wanted environmentally friendly substitutes, or cheaper options.

- In 2009 released a new formula, 15% less chemical, biodegradable, faired poorly to competition.

- Also in 2009, released a 3:1 concentrate, wasn’t very successful, even in a growing segment.

- Brand might be too old. Popular in times when environmental concerns were not.

Company Background: MJ Brenner

- Founded in 1925 in Toledo.

- In 1950 created cleaning products.

- 2011 revenue $6.2 billion, 80% coming from the US

o Household Cleaning Products: 31.5%

o Industrial Cleaning Products: 40%

o Auto Cleaning 28.5%

7% of sales are invested in research and development.

25% of brand revenue on marketing to grow and reinforce brand awareness.

Organization

- Privately owned, 10,00 employees worldwide.

- 30 Products, under 11 brands.

- Split into 3 divisions, Industrial, Home Cleaning and Auto Cleaning.

- All run independently.

US Household Cleaning Industry

- Household supplies totaled $5.04 billion in 2010.

- Hard-service cleaners 56% of sales, generated $1.4 billion

- All purpose cleaners equaled $384 million in 2011

- Consumers have become more price sensitive because of economic downturn, cleaning habits have changed.

- Consumers used fewer products and replenished them slower.

Environmental Concerns

- Consumers worry about the environmental impact of chemical products.

o Concerned about skin exposure, children at risk

o Long term effects on food and water supply.

o Cancer

- Demand for green product grew during the early 2000. In 2006 had 17 green products, 2010 had 164

- 5 largest consumer product companies produced the 8 leading all-purpose cleaning brands, generating 79% of sales.

Distribution

- Consumers could purchase at many outlets.

- Food, drug, and mass merchant retailers (FDM) accounted for $199.68 million of 384$ all purpose market. Supermarkets accounted for $139.78 million. (Low profit marigins, offered as lost leaders)

- Also can be found in small grocery chains, convenience stores, hardware stores.

CleanSpritz History

- Acquired in 1985 from Stalton & Sons

- 2 different kinds, CleanSpritz all-purpose and 3:1 concentrated.

- Revenue $53.76 million

- 32 oz. spray bottle (96% water, 4% chemicals)

CleanSpritz Concentrate

- Created in 2008 due to environmental concerns in 16 oz. bottles.

- High interest from professional cleaners, those looking to save money, help environment.

- Thought Concentrate could reach 30% of all-purpose cleaning volume within 4 years

- Concentrate would make up 20% of CleanSpritz volume in 2011

Advertising

- 70% of ad budget went to trade promotions. Smallest were consumer promotions including coupons sweepstakes, reward program.

- Consumer promotions were further reduced, to 1% to launch a series of new media campaigns.

Declining Sales

- Between 2006-2011 combined revenue between both products fell at an average of 7.5% annually.

- Caused by economic recession. Consumers cut spending, used less product.

- Consumers migrated to greener products and inexpensive private lables.

Strategic Options

- In 2010 it was indicated that 70% of consumers after being educated on concentrates were open to trying them to cut down on packaging for environmental reasons.

- Consumer interest had not translated into high sales of CleanSpritz concentrate. This behavior mirrored a broader trend in US consumers.

- Actual sales of green household cleaning supplies lagged far behind reported consumer interest in green cleaning supplies.

- Could it be because of price? Doubt about effectiveness? Brand Confusion?

- In 2011 green cleaning supplies were only 3% of FDM cleaning supply sales.

Option 1: Re-launch the existing 3:1 CleanSpritz Concentrate

- Heavy promotion of environment benefits.

o Reduced packaging (45% less than diluted spray)

o Less pollution from freight

o Reuse of old spray bottle.

- 6% increase in ad spending in 2011

- 60% of media spending on diluted spray, 40% of diluted spray

- Expected to increase

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