P&G gambles on 30m Ace launch

Laundry is not as dirty as it used to be. Stubborn stains make up a smaller part of washing problems, and 93 per cent of all washes are carried out without any additives.

These conclusions of the 1996 UK fabric washing detergents report by Lever Brothers have done nothing to dissuade rival Procter & Gamble from launching Ace Gentle Bleach (MW February 21). Ace is a washing additive aimed at cleaning up that declining number of stubborn stains in the British laundry basket.

P&G is taking a gamble with its first new brand launch in the UK laundry market for 20 years. But it also signals that P&G is feeling confident about standalone launches rather than simply going for a line extension. And more significantly it appears to be exploiting an apparent fear at Lever about launching innovations after the Persil Power fiasco in 1994.

A 30m ad campaign is planned across Europe. But even so, the introduction of Ace Gentle Bleach to the UK next week is going to need some explaining to consumers.

P&G says Ace can be used with all washable fabrics – from cotton to silk and wool, and on all colours – without fading them. This upsets the conventional wisdom of the laundry detergents market, which has split into two branches: products for washing whites, which include bleach, and those which can be used for colours, without bleach.

Ace Gentle Bleach uses hydrogen peroxide; the same substance used in hair dye. Lever’s Persil also uses oxygen-based bleach, but a company spokeswoman says: “We haven’t made a feature of bleach for a long time, it can be a problem for coloured garments. We make a benefit of not having bleach in colour products.”

Bleach has negative connotations in the minds of British consumers as far as laundry is concerned. It is a cheap way of dying your hair, or a liquid which, handled with care, can be used to clean the filthiest recesses of the nation’s toilet bowls. A great whitener, bleach will lift tannin from sinks and floors.

But its use in laundry detergents has been played down by detergent manufacturers for more than 30 years. Confused consumers were using it to clean coloured clothes, and found it faded those colours. “Bleach paranoia” swept the country; with warnings about keeping it away from children, and its use by criminals to blind security guards.

In southern Europe, the story is very different and bleach is a widely used and popular additive to the wash. Ace has already been introduced in Greece and Italy. But whether UK consumers will take to it is another question.

The gamble for P&G is not just that consumers may fail to grasp why, after years of being played down, laundry bleach is suddenly back on the agenda. But the launch may also undermine P&G’s “key driving principle” of making brands more “transparent” or obvious to the consumer; the philosophy behind its “value pricing” moves of the past year.

This principle has led P&G to axe price promotions, cut out irrelevant product lines and simplify the sizes of its different products. But some observers say that the launch of Ace Gentle Bleach is more likely to fuel consumer confusion.

P&G is to start by explaining the product’s benefits to consumers. Apart from a heavyweight TV advertising campaign, there will also be a programme of consumer education. In large supermarkets, Ace will even have its own display units to preach its advantages.

Retail buyers are sceptical that Ace will gain widespread acceptance in the UK. One says: “P&G has an enormous amount of work to do in allaying consumers’ fears about putting bleach into washing machines.”

He is not convinced that there is much of a market for Ace in the UK. After all, only seven per cent of washes use additives, according to Lever’s fabric report.

P&G claims to be opening a new sector in the UK detergents market, a third string to add to detergents and fabric conditioners. But there is already a laundry additives market in the UK, worth about 30m, of which Benckiser’s Vanish has well over 50 per cent.

Benckiser marketing director Keith Edwards says the sector has doubled in value since the launch of Vanish in 1994.

P&G is reported to have earmarked 30m for advertising the launch of Ace across Europe – to enter a market worth only 30m in the UK.

This raises the question of how the launch of Ace fits in with P&G’s pledge to make its marketing more “transparent”. One of its main objectives over the past year has been to “provide meaningful product advantages over competitive brands, which meet needs and can be readily experienced in the home”. Ace will fit into this category only if P&G is successful in persuading UK shoppers of the benefits of using bleach on their clothes.

After introducing this strategy of clarification, P&G has proceeded to take steps that are leaving the trade, and no doubt some consumers, more confused than ever.

The company has reversed the price cuts it implemented on a range of products early last year. The prices were slashed when P&G introduced its strategy of axing promotions and establishing prices for its products to make them more competitive with retailers’ own-label products. Through having stable, low prices P&G argued that consumers would become more loyal to its products. The absence of the promotional machinery saved the money.

The strategy may have achieved these aims, but it has also wiped millions of pounds off the value of P&G’s brands (MW December 6 1996).

Price hikes have been introduced in recent weeks. The company says the rises come as a result of product improvements. The price of a standard pack of Pampers was reduced at the beginning of last year from 6.45 to 5.95, but has now been put up to 6.35. Lenor has seen its price increase from 1.45 for a 750ml bottle to 1.55.

But the latest price rise on Fairy Liquid does not fit in with P&G’s wish to clarify the position of brands for consumers. The company says there have been improvements to Fairy, and there will be more changes to the brand. However, it admits that these improvements have not been demonstrated to consumers with the “new improved” tag. Confused? Consumers will be.

Companies like P&G are under great pressure to rush new products on to the market. The slide in the values of P&G brands since the introduction of its value pricing strategy makes it even more important for the company to come up with some money-spinning new products.

It may succeed with Ace, given enough advertising and support from retailers. If not, the launch could look like a panic measure to claw back some of the cash lost on value pricing – a strategy that has yet to prove its worth.