Engineering News

Energy savings touted with new laundry detergents
Mon Apr 4, 2005 12:01 PM ET

NEW YORK, April 4 (Reuters) - Call it the "cold-water wash wars." Tide and Purex, two well-known names in the laundry aisle, are going head-to-head with new detergents formulated for use in cold water.

Consumers who wash their clothes in cold water instead of warm water could save more than $60 per year, they say. At a time when costs for necessities such as gasoline are on the rise, consumers are expected to welcome the savings.

Both Tide Coldwater and a reformulated Purex have received positive feedback from consumers, their manufacturers said.

Procter & Gamble Co.'s marketing campaign for Tide Coldwater includes television commercials and alliances with energy organizations. Purex, a lower-priced rival, is highlighting its new cold-water formula on its bottle, but has no big marketing plans.

"We're a bit of a David versus the Goliath in this marketplace," said Eric Schwartz, senior brand manager for Purex. Its detergent is made by Dial, which is a unit of Germany's Henkel KGaA.

Tide Brand Manager Julie Woffington declined to comment on specific marketing figures for Tide Coldwater. She said the spending should be just as big as it was for "Tide with a touch of Downy" -- which in late 2004 was the biggest new Tide launch in 10 years.

That product was soon copied by Church & Dwight Co. Inc.'s Arm & Hammer Detergent Plus a Touch of Softener.

Purex launched its product once it heard of Tide's plans.

"We've been working on this kind of a formulation for some time, but when we caught wind of their change, we pulled the trigger on something that we weren't planning to pull the trigger on yet," Schwartz said. His company expects to sell more than 12 million bottles of the new Purex this year.

"Henkel's probably doing the smart thing by leveraging off of P&G's marketing spending to educate the consumer and introducing a lower-end product that attempts to do the same as Tide Coldwater, but at a lower price point," said A.G. Edwards analyst Jason Gere.

Purex's average retail price is about $3.50 for a 100-ounce bottle, versus about $6.99 for a bottle of Tide.

"We definitely hear from consumers that Tide is more premium-priced," said Woffington. She said Tide Coldwater "is appealing to a new group of people who have not wanted to consider Tide before because of the price premium."

P&G and Dial each cited research that an average family, doing seven loads of laundry per week, could save $63 per year in energy costs by switching to cold-water washing.

Consumers are often concerned about how clean clothes will be when washed in cold water. Purex's Schwartz admitted that washing in cold water is sometimes not as effective as using warmer water, since the combination of heat and motion helps the detergent in cleaning. However, he said the new Purex is more effective at cleaning in cold water than the old formula.

P&G's plans include launching a Web site with the Alliance to Save Energy, http://www.coldwaterchallenge.com, where consumers can sign up for a free sample of Tide Coldwater. The company hopes to get 1 million consumers signed up. So far, more than 780,000 have done so.

"I think P&G as the marketers they are have found another niche segment that they can tie into," Gere said of linking the new Tide into energy savings. He rates P&G "buy" and does not have a rating on Henkel. "I don't expect it to be a blockbuster, but I think that it certainly will help shift some people maybe from lower-end products to trade up."

Source: Routers

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