P&G Awash in Success of Tide Pods, Despite Wrinkles Along the Way

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Tide Pods are providing a robust helping of good news for Procter & Gamble in a year when its brands, products, strategy and even CEO have been taking a beating.

The company is projecting $500 million in first-year retail sales for pods, according to Ad Age. That’s a major feat, given that of the 1,500 new consumer-packaged-goods launches tracked by SymphonyIRI in 2011, only 21 percent reached one-year sales of even $50 million.

Hungry for a big win at a time when nearly everything about its long-running formula for victory has been questioned, P&G has seen Tide Pods become a relatively rapid success since launching in February with a colorful campaign — with a few speed bumps along the way.[more]

Those stumbles: There’s a supply constraint on the pods, so P&G hasn’t been able — or hasn’t had — to offer promotions on the product. Politicians, regulators and consumer advocates have been looking at Tide Pods because of the predilection of small children to eat them and be poisoned, which happened about 500 times since launch (including 320 calls to poison centers just in May) according to federal government estimates. Tide has started promoting laundry safety and safe storage to educated consumers and hopefully avoid any more accidental ingestions.

P&G announced in May it would tweak the packaging, as WSJ noted, adding “a double latch lid to containers of its new Tide Pods detergent following reports that some children have mistaken the colorful, gumball-sized packets for candy.” In September, Sun Products, maker of All Mighty Pacs, sued P&G for patent infringement.

Still, so far, Tide’s share of the unit-dose segment of detergent sales has swelled to 73 percent, more than double its 36-percent share of the liquid-detergent segment and 29 percent in powder, according to SymphonyIRI figures cited by Ad Age.

And P&G posted that result in an overall laundry category whose sales are only flat. Americans apparently have been scrimping on washing their clothes as well as on everything else these days.

The key to Tide Pods’ success so far seems to be that consumers perceive it as an efficiency play more than demonstrating a price advantage, Ad Age commentes. That’s why it’s especially popular with Millennials, apartment dwellers and people who have their washers in the basement.

P&G has even begun marketing Tide products toward men, the age-old slackers in the laundry department. The brand features New Orleans Saints quarterback Drew Brees on bottles of Tide Plus Febreze Sport “with victory fresh scent.” Seems like Tide Pods — with its emphasis on no-brainer convenience — also would figure into the brand’s future marketing toward men.

In any event, Tide Pods also is a stellar example of what P&G can still accomplish when it gets its much-vaunted innovation machine running on all cylinders. And once supply of the product rises to the point where P&G can begin to apply some of its marketing magic to Tide Pods, it could gain even more dominance in a nascent category.

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