Megan Eisenbrown, Juliet Levine, Hillary Pond and Rachel Woloszynski

Agenda IntroductionIndustry StructureAdvertising Strategies Analysis & Recommendations

Why Soaps & Detergents? Regularly and frequently purchased products Brand loyalty to household products Key players stand out High advertising-to- sales ratio

Soap & Cleaning Compound Manufacturing in the United States

Industry Overview Definition: Substances that loosen and remove soil from a surface for personal hygiene, sanitization or cleaning clothes, linens, and furnishings. Major products: Soaps and detergents, polishes and other sanitation goods, surfactants and finishing agents Major functions: Prepare, manufacture, and package cleaning compounds

Soaps & Detergents Overview

ProductProducer Cost Consumer Cost: Average Retail Price Laundry Detergent Ingredient costs are % of wholesale price Labor costs absorb 20% of total costs High initial capital expenditures for plants and technology $5 Soap$2.50 Dishwashing Detergent $2

Demand Drivers World Price of Crude Oil Per Capita Disposable Income Drive/stifle industry growth

Demand Drivers FY13: The increase in per capita disposable income is expected to drive growth in the industry in 2013.

International Trade Industry exports generate $8.6B annually, or 15.4% of industry revenue. Core Market Expansion Opportunity

International Trade

Market Segmentation Commercial Sales Food Service Establishments Healthcare Providers Lodging Establishments Household Sales Supermarkets and Mass Merchandisers Convenience Stores Independent Retailers Soaps and detergents are sold directly from the wholesaler to commercial businesses and through retail outlets for the everyday, average consumer

Market Segmentation

Barriers to Entry Factors affecting entry Mature Life Cycle Government Regulation High Competition High Marketing Costs High Capital Costs Medium Concentration Overall difficulty of entry: Medium

Competitive Landscape Companies: 1,964 Major Players: 4 HHI: “ The top 50 companies hold about 90% of the market.” -FirstResearch

Major Players Ecolab Market Share: 5.9% FY12 Profits: $3.2B 5-Year Growth Rate: 6.7% Brands: Ecolab S.C. Johnson Market Share: 9.5% FY12 Profits: $15.2B 5-Year Growth Rate: 2.9% Brands: Pledge, Glade, Windex, Ziplox Colgate-Palmolive Market Share: 5.7% FY12 Profits: $3.1B 5-Year Growth Rate: 2.4% Brands: Colgate Toothpaste, Irish Spring, Palmolive Procter & Gamble Market Share: 19.6% FY12 Profits: $10.7B 5-Year Growth Rate: 3.4% Brands: Tide, Cascade, Charmin, Crest

Industry Trends Employment Fewer workers due to increased automation Decrease in production costs Emerging Markets The U.S. market is stagnant Increased of acceptance of products and per capita income in undeveloped nations Increasing Regulation Further the green movement within the industry

Strategies and Analysis

Product Differentiation

Differentiated Packaging

Cross Promotion

Online Advertising & Social Media Add pictures

Informative

Ad Characteristics Observations Frequency of Characteristics Mentioned: High Average Number of Characteristics Mentioned: 3 Common Trends: cleaning power, concentration Frequency of Characteristics Mentioned: Medium Average Number of Characteristics Mentioned: 2 Common Trends: freshness, clean boost, scent Frequency of Characteristics Mentioned: Low Average Number of Characteristics Mentioned: 0-1 Common Trends: clean, color enhancement

Sales Promotion

YouTube

Celebrity Endorsement nQj8

Humor Advertising

Comparative Advertising

Sustainability Initiative

Social Responsibility

Sponsorships

Brand Loyalty “That’s my Tide. What’s Yours?” “Get Irresistibly Fresh” “It’s All Good”

Brand Equity Goodwill (2012) In Billions Procter & Gamble Colgate-Palmolive Co. 2.5 Johnson & Johnson

Comparing the Top 3 Companies in the Industry

Total Advertising Expenditure by Company

Advertising-to-Sales Ratio

Analyzing Raw Data

Spending per Media Type

Spending per Network

Spending per Program Type

Advertising Expenditure by Product

Spending per Network

Spending per Program Type

Spending per Week Day

Spending by Day Part

Product Spending on Prime Daypart Total Ad Spending Percent of Total Spending on Prime All$8,228,173$19,878,16041% Gain$3,719,908$8,898,49942% Tide$29,486,556$67,277,10244% Ad Spending on Primetime

Ad Observations: Key Findings High frequency of characteristics Limited to no comparative advertising No celebrities, humor, or emotion Demographic: children Gain Repetition of the word “Freshness” References to “that other stuff” in indirect comparison Money back guarantee Humor was evident in almost all cases Tide Library of commercials was extensive Humor and emotion was evident in almost all cases Demographic: parents “That’s my Tide. What’s yours?” All

Ad Observation: Spanish Demographic

Industry and Advertising Analysis

Investment Barrons

Procter & Gamble Co

Advertising Strategy Exploring less saturated markets globally Promoting sustainable side Expanding the target demographic Innovation

Questions?