Wiping out the competition

New and improved branded and private label offerings ensure the love affair with the supermarket paper goods aisle will keep going strong.

Paper products sales are on a roll—and that even applies to rectangular boxes of facial tissue.

Chances are most shopping carts rolling down supermarket aisles will contain at least one multi-pack, single roll or box of a paper product. Consumers, it seems, cannot get enough bathroom tissue, paper towels, napkins and facial tissue.

“As true consumer staples, these categories are unique,” says Ken Champa, Scott brand manager at Kimberly-Clark Corp., the Dallas-based manufacturer of Cottonelle, Kleenex, Viva and Scott brands. “They are part of only a handful that can drive foot traffic into the store, and ultimately across all categories. To harness that power, there is no one strategy—EDLP, convenience, selection—that ensures success. Those retailers who select a go to market strategy that is unique to their market, and stay true to it without wavering, seem to be the most successful time and again.”

According to IRI, a Chicago-based market research firm, for the 52-weeks ended September 7, sales of toilet tissue in the food channel reached $3.1 billion, a 0.4% decline from a year ago, while volume was 570.8 million units, a decline of 2.3%. During the same period sales of paper towels reached $1.87 billion, a decline of 1.2%. Napkins were $332.5 million, a decline of 2.9%, while facial tissue had sales of $622.3 million, a minimal decline of 0.5%.

Some of the marginal declines can be attributed to shoppers purchasing their products in other channels, namely dollar stores, drugstores and membership clubs; Kirkland Signature private label bath tissue, for example, is said to be among the top-selling products at Costco. The dollar store channel targets consumers living paycheck to paycheck with single rolls of paper towels and bath tissue that sell for a dollar apiece. 

According to industry observers, traditional supermarkets can fight back by offering a full range of product sizes.

“People that don’t have enough money to spend on big packages on a weekly basis will buy a smaller form, so we are looking into doing smaller packs, like a two-roll pack of towels and four-roll pack of bath tissue that both have that premium quality,” says Daniel David, executive vice president, Global Tissue Group, a Medford, N.Y.-based manufacturer of branded and private label paper products. “This way supermarkets can serve that customer that wants the premium product but just doesn’t have the money to spend on a larger pack.”

Global is among the manufacturers revolutionizing the paper category with new product offerings and improved packaging. On its Quilty paper towels and Q Soft bathroom tissue, for example, Global has added a hologram feature to its polyfilm packaging. “It has a sparkle or sheen to it, so that reflection off the light in the store gives it a hologram look,” David says.

The product inside the packaging has also been improved, officials say. “Quilty is an ultra premium value towel,” David says. “We are creating a new ultra premium category that is in between a Bounty ultra premium level and a Sparkle mid-tier premium level. It has the characteristics of an ultra premium towel, but more the pricing and cost effectiveness of a mid-level towel.”

David says Global’s Q Soft bathroom tissue fulfills the same niche, falling between a Charmin and Quilted Northern. Currently Q Soft is available in 12-roll packages while Quilty is available in 6- and 8-roll counts.

The Sparkle brand is brightening up the staid white paper towel set with its Hint of Color line, introduced earlier this year.

“Sparkle Hint of Color is unique in that it is a paper towel that is not quite white, but not quite a print, with one subtle color across the pattern,” says Katie Kolesky, brand director for Sparkle at Georgia-Pacific, based in Atlanta. “It offers consumers a pop of color to brighten things up. Research shows that Sparkle Hint of Color over-indexes with Millennials, who prefer Hint of Color over print designs.”

Kimberly-Clark also did its part to liven up the paper towel set with Viva Vantage, which is billed as having one-of-a-kind, V-Flex Weave technology. “It is the best combination of strength, stretch and softness, giving consumers remarkable scrubbing power and absorbency to clean up everyday messes,” says Sean Nobui, Viva brand manager.

Sister brand Scott is also merchandising its strength. “Consumers expect a paper towel to meet their many needs, and creating a compelling consumer benefit is key to achieving category growth with both premium and pragmatic consumers,” says Champa.

Change is also afoot on Kimberly-Clark’s Cottonelle bathroom tissue line, which, in 2015, will introduce its new CleanRipple texture across both toilet paper and flushable wipes. “Only Cottonelle toilet paper and flushable wipes feature the unique CleanRipple texture—a texture exclusively designed to absorb faster and remove more for an effective personal clean,” says Amanda O’Connor, Cottonelle senior brand manager.

In 2015 Cottonelle will also continue to build its flushable cleansing cloth product lines. “The current Cottonelle ‘Let’s Talk About Your Bum’ program, for example, is all about getting people to talk about an often taboo topic, the way they wipe, in order to learn about a better way to get clean using Cottonelle toilet paper and flushable cleansing cloths,” says O’Connor.

On the Scott side of the business, this past summer the Scott Naturals Tube-Free product went national. “While Scott Naturals Tube-Free has been on shelves since 2010 in limited Northeastern markets, the national release signifies Kimberly-Clark’s continued commitment to sustainability initiatives,” says Champa.   

This summer Oasis Brands improved its Fiora Bath Tissue by adding more sheets and softness. A roll now contains 350 sheets, more than twice as many as most double rolls, say company officials.

“Our position is simple: good products, longer lasting rolls. That’s why Fiora continues to be the fastest growing tissue brand in America,” says Scott Hunter, senior director of corporate communications and branding, at Oasis Brands, based in Winchester, Va.

The Fiora brand includes bath tissue, paper towels and facial tissue. “The Fiora brand spans the key retail paper categories and offers simple value equations, clear assurances of sustainability and better margins for retailers,” says Hunter. “Our new paper towels will be the longest regular roll out there and Fiora is the only tissue brand with Programme for the Endorsement of Forest Certification (PEFC)-certified products across all categories.”

According to IRI, Fiora is the 12th largest brand of toilet tissue and rapidly growing, with a sales increase of more than 54%. Company officials expect sales to grow even further now that the brand has launched its fall television debut, including in-show integration on ABC’s The Chew.

“In addition to a national base plan of FSIs, TV support and a social media program with very strong engagement rates, we have invested market-by-market to demonstrate to retailers that we’re committed to this brand and their business,” Hunter says.  “We’ve also had an aggressive promotional strategy to encourage and incentivize consumer trial. Increasingly we are finding that participating in retailers’ own programs is a good way for us to generate grassroots support with shoppers.”             

Common scents

Fiora is capitalizing on the latest development in bathroom tissue: scented tissue. “Our Fiora Lavender Scented product is a unique innovation for added freshness,” says Hunter. “The inner core is scented with a special blend which delivers a fresh fragrance without adding any dyes or perfumes to the actual sheets.”

Consumers eyeing their carbon and environmental footprints prompted U.S. Alliance Paper to launch Earth First earlier this year.

“Earth First is made with 80% post-consumer recycled paper,” says John Sarraf, CEO of the Brentwood, N.Y.-based company. “The demand is steady. It is a segment that is really focused on being conscious on about the environment and this is a product they demand.”

Consumers are also demanding competitive price points, which is where U.S. Alliance Paper’s Daisy brand comes in. “Daisy is a brand we have targeted for the value market for grocery chains, dollar stores and dollar distributors. It offers a very good value proposition,” Sarraf says. “We also have another label, Delicate Touch, that is a high-grade quality that goes up against the national brands.”

In order to maximize category reach and profitability, retailers need to strike a balance between national brands and private label, say observers. “Best-in-class retailers utilize the national brands most valued by the retailer’s core shopper to drive traffic and trips, and utilize private label to drive retailer loyalty, opening price point and category margins,” says Georgia-Pacific’s Kolesky.

Many private label offerings are now equal to or superior to the big national brands, says Bruce Woodlief, director of marketing – consumer products, at Clearwater Paper Corp., a private label paper manufacturer based in Spokane, Wash.

“Clearwater continues to have much success in the growth of its TAD ultra-premium bath product that was rolled out in 2013,” Woodlief says. “Consumer acceptance has been very good and retail customer volume continues to grow.” 

He adds that a strong private label offering will help supermarkets better compete against other classes of trade that use big packs of national brands to draw in shoppers.

“Competing effectively against national brands requires a true national brand equivalent quality product that is priced, promoted and merchandised competitively against the branded product,” Woodlief says. “Packaging with product claims also plays an important role in attracting branded shoppers including use of ‘compare to’ statements.”

Just about every retailer has a private label paper line, says David of Global Tissue Group. “The reason is the margins,” he says. “Margins are just so much more on private label, and the retailer is building stock in their own company name, company brand and loyalty with their customers.”

According to David, the “me too” merchandising of private label next to the national brand is becoming passé. “There are a lot of retailers that are innovative and going after what their consumer is looking for that’s not a me-too national brand, but in their price range and in the quality that they are looking for,” he says.

But national brands are also innovating. In February, Kimberly-Clark will introduce a new small format solution called Kleenex PerfectFit, that is designed for use beyond sickness and placement throughout the home.

Kleenex brand is once again touting its www.achoo.com website that includes helpful information on signs to identify risk of getting sick, a daily cold and flu tip, as well as local vaccine finders. Consumers can also print a coupon good for 40-cents off two boxes or one bundle pack of Kleenex brand tissues, or 75-cents off three boxes or one bundle pack of Kleenex brand facial tissue if they share with friends.

“Kleenex brand is encouraging consumers to share the softness of Kleenex brand tissue to help bring comfort to others, and to themselves, this cold and flu season,” says Anna Elledge, Kleenex brand manger.       

Elledge says retailers can increase sales by correctly merchandising facial tissue for the cold and flu season. “At the beginning of the season, retailers may want to focus on encouraging their shoppers to stock up to prepare for cold and flu with Kleenex brand bundle packs,” she says. “As the season moves into more symptomology-heavy periods, they may want to consider giving some focus to super-premium variants like Kleenex Cool Touch, Lotion and Ultra, since consumers often gravitate towards those when they are sick.”