US Laundry Care Market Case Study: How leading manufacturers can enhance perceptions of value

Buying behavior in the US laundry care market was impacted by the economic downturn, as greater emphasis was placed on obtaining value for money. Procter & Gamble looked to capitalize on this through the launch of Tide Basic and re-positioning of Cheer brightCLEAN as a value brand. The Dial Corporation looked to emphasize value through enhanced efficacy benefits with its Purex brandEnhance brand desirability by understanding what factors have the most influence on shopping behavior in the marketBest understand how to enhance perceptions of value and respond to the threat of cheaper priced competitorsUnderstand the key challenges for Tide, Cheer brightCLEAN and Purex in a post-recession marketGreater emphasis on obtaining value doesn’t necessarily equate to purchasing the cheapest priced product, and this is ultimately why Tide Basic failed. Instead, perceptions of value are enhanced through satisfying factors such as efficacy and convenience at a satisfactory price point – which is why Purex and Cheer brightCLEAN have fared betterLeading brands recognize the threat to market share from cheaper competitors and that strategies are needed to reduce switching intentions. The key lesson is that leading brands are better differentiating from cheaper competitors through leveraging traits such as quality and convenience, rather than launching cheaper, less effective, offeringsWhat are the key product traits that influence buying behavior in the US laundry care market?How did the recession impact buying behavior in the US laundry care market?How can national brands in the US laundry care market respond to the threat of private label?What are the dangers of releasing a fighter brand?

Laundry Services Industry in the United States

OVERVIEW
Catalyst
Summary
ANALYSIS
The recession brought about changes in consumption behavior in the US laundry care market, which resulted in major manufacturers adjusting their strategies
The US laundry care market is currently in a period of stagnation
The recession brought about changes in consumption patterns in the laundry care market
This change in buying behavior prompted major brands to re-assess their strategies in order to offer better value for money
Tide Basic looked to stave off the threat of private label, but the product failed
Tide Basic was removed from shelves a year after launch, with P&G saying that the Tide brand's future activity would be centered around improved efficacy
Cheer brightCLEAN: capturing market share through being repositioned as a value brand
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P&G will need to remain mindful of the threat from cheaper alternatives as upstream, supply-side market developments will cause future price rises
Purex: enhancing perceptions of value through efficacy and simplicity
Purex is looking to capitalize on the success of Complete 3-in-1 with the launch of Complete Crystals Softener
Conclusion and implications: the key message for laundry care manufacturers is that even in times of reduced financial wellbeing, consumers are willing to trade-up to products that offer enhanced efficacy benefits
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