After months of delay, Procter & Gamble Company (PG) finally announced the commencement of the marketing campaign of its first multi-chambered laundry detergent, Tide Pods. The $150 million promotional blitz has been christened as ‘Pop In and Stand Out’.
The commercial emphasizes on the multiple uses of the Tide Pods – cleaning, fighting stains and brightening colors of clothes. It highlights the different uses of the product, like popping a pod into a washer or making colors pop with brightness. The word is repeated in phrases that appear in the ads, like “Get ready to pop your laundry,” “Pop of fresh,” “Pop of clean” and “Pop of hello gorgeous.”
The three-chamber Tide Pods are similar to water-soluble tablets for dishwashers, which have been embraced by consumers wholeheartedly. It was supposed to hit the stores last summer. However, P&G delayed the launch of the Tide Pods Liquid laundry tablets to early 2012 instead of previously-decided September 2011.
The chain disclosed that it was compelled to postpone the launch on grounds of supply constraints, which may make it impossible for the company to meet the forecasted huge demand.
Moreover, it also gave the excuse that the mega-launch planned for an item like Tide Pods warrants heavy marketing and advertising spending.
But at last, the retail giant has begun rolling out the revolutionary detergent into big retail chains like Walmart Stores Inc. (WMT). However, as feared by the analysts, the delay has caused P&G loss from twin angles.
Taking advantage of the delay in the launch of the Tide Pods by P&G, Arm & Hammer geared up their own single-use detergent packs in what is expected to be a $300-million new segment. Again, Henkel and Unilever Plc. (UL) already sell similar highly condensed liquid-filled laundry tablets in Western Europe. Water-soluble tablets for dishwashers that can be easily adapted for laundry products also exist.
Moreover, after the proposed launch in September 2011 was shelved, the commodity cost has jumped to great heights in the meantime. To combat this, P&G had to reportedly raise prices. This has put the nation’s largest maker of packaged goods in a spot of bother as the price of Tide Pods should be set cautiously with P&G struggling to woo budget-conscious customers and distract them from cheaper alternatives, like Arm & Hammer, Purex and Xtra.
However, P&G feels that the upbeat, youthful attitude of the ad meant to underline the differences between Tide Pods and conventional detergents. The ads are expected to lure the young people. The commercial will be flashed in traditional, digital, mobile and social media, as well as in stores. Tide Pods will be available in three scents Spring Meadow, Ocean Mist and Mystic Forest in large, XL, and XXL tubs.
Currently P&G holds a Zacks #4 Rank (short-term Sell rating). On a long-term basis, we maintain a Neutral recommendation on the stock.
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