Retailers are stocking the cleaning aisle with larger sizes to compete with mass merchants, but this short-term strategy falls short of a real solution.
It may be that a new paradigm is needed to sell cleaning supplies -- including detergents -- in supermarkets. A new approach might include recreating the cleaning aisle as a solution center and/or repositioning these items as a convenience category.
Chris Hoyt, president of Stamford, Conn.-based Hoyt & Co., a marketing and consulting firm, told SN that supermarkets need to change the way they look at the cleaning categories.
"Household cleaners is a category that is migrating out of supermarkets," said Hoyt. "It's literally drifting away to mass merchandisers.
"Consumers don't go to the supermarkets for items that they can buy 6% less at a mass merchant. Price and time drive a consumer. Retailers are not going to win and they can't compete," added Hoyt. "Supermarkets have to stop promoting [these items] and position them as a convenience."
All the retailers that SN spoke with said they are having a tough time with the cleaning categories. Some are stocking a greater variety of larger sizes to help bring consumers back into the aisle, while others are slashing prices.
"We are starting to eliminate the smaller sizes and promote the larger sizes in ads," said Doug Murphy, director of grocery merchandising for South Bend, Ind.-based Martin's Super Markets.
"We're now going with the bigger-sized packs of items, like paper towels and detergents, so when the customers buy they can fill their pantries for a long time."
Although sales of cleaning supplies remained steady during the past year, Murphy has noticed that air refreshers and scented candles have done very well.
Another retailer that is trying a number of strategies is Super A Foods, Paramount, Calif. "By selling in bulk, the Wal-Mart [type of store] has had a major effect on us. They've taken a lot of business away from retail food markets," said Lou Amen, chairman at Super A. "It's tough, really tough."
Amen thinks that the way to beat these stores is through under-pricing and constant promotion. "We run under-pricing ads all the time," said Amen. "We try to go under and then promote more. With the Wal-Marts, that's all you can do, but we haven't given up."
According to Information Resources Inc., Chicago, many sub-categories in the cleaning category are flat or down in all channels. Scan data for the 52-week period ended Jan. 24, 1999, showed that in the food, drug and mass-merchant channels, sink cleansers and powdered laundry detergents were down 3.9% and 4.7%, respectively, in dollar sales, while floor and wall cleaners were up a mere 0.5%.
Categories that saw growth during the same period were counter and window cleansers, up 7.2%, and liquid laundry detergents, up 2.5%. The biggest increase in dollar sales -- 24.2% -- came from bathroom cleansers.
The Seymour, Ind.-based John C. Groub Co., like Super A, is also cutting prices and promoting more. At Groub, one aisle is devoted to cleaning supplies.
Larry Miller, a category manager for Groub, said that the best way to combat bulk sales siphoned off by mass merchants is through promotion and lower prices. In addition, Miller looks for uncommon products to stock.
"The main thing is to use promotions and to lower everyday prices," said Miller. "We don't carry bulk items in the cleaning aisles.
"We also try to look for items that are out-of-the-ordinary. An example would be a foam garbage disposal cleaner that sanitizes. A product like this is not seen in a lot of other stores," added Miller.
Miller pointed out that sales are down slightly and the mass merchants are a "guaranteed" reason why sales are low. While Groub advertises in circulars and ads to promote cleaning products, Miller said, it's difficult to compete with mass merchants on that front as well, since his smaller store can apportion only a limited amount of space to these items.
Miller noted that shower cleaners see brisk sales at Groub. "It doesn't matter which brand you put up; people tend to buy them." Acme Markets, North Tazewell, Va., unlike the other retailers, steers clear of promoting cleaning products.
According to Ed Kolodzieski, president of Acme, promotions done in the past did not pay off. "In years past we tried a number of 'spring cleaning' promotions, and those items turned out to be not as responsive as others," said Kolodzieski. "Now we just try to sell the merchandise off the shelves.
"We have one aisle and that hasn't changed. This is not an area that we've had success in, and we' re not promoting it aggressively," he continued, adding that the company sees profits with outdoor impulse items during this time of year.
Another marketing consultant said that it is nearly impossible to get ahead of mass merchants in the cleaning-supply area. Jon Kramer, president of the Stamford, Conn.-based marketing and consulting firm J. Brown/LMC, said the entire grocery business model needs to be changed.
"The model is inconsistent for Center Store products," said Kramer. "People are stocking up on staples in alternative channels and using the grocery store for fill-in-as-needed items. Products are price-based and cheaper in the mass classes. Center Store is grappling with this issue. It's a price game."
According to Kramer, the average American family spends $4,700 a year on groceries. "Consumers are using stock trips, because if they can save 15% they will," he said. "They'll take that trip once every six weeks."
Kramer said supermarkets should emphasize the perimeter and cut down on stockkeeping units in Center Store, while selling certain staple items at full price.
Nonetheless, as reported in SN, some supermarkets are extending the detergent category, for example, by offering customers more sophisticated products. Wegmans Food Markets, Rochester, N.Y., is offering private-label laundry supplies in five categories and marketing a five-step laundry process to help drive sales.