Daily Insights

A Tough Sell

By: Alizah Asif Farooqi | Jun 19, 2019

With an increasingly complex web of retail models, consumer packaged goods (CPG) brands face the daunting task of navigating new distribution models while supporting traditional channels, which still represent upwards of 95% of their sales. With Amazon’s influence and push for profitability, bulky home care products like laundry detergents are facing the heat.

Seventh Generation and Tide launched new laundry detergent packs — EasyDose in October 2018 and Eco-Box in January 2019, respectively, according to Gartner L2’s report on the topic. These products are optimized for e-commerce fulfillment, with less water in the formula and less plastic to reduce the overall weight. Amazon challenged Tide to turn its plastic in the packaging bottles into cardboard boxes on their merits of shipping and eco-friendly packaging, but the new designs could also alienate current buyers, and so both brands have included visuals and “how-to” videos to educate consumers on their Amazon product pages.

Tide and Seventh Generation differ distinctly in their media strategies. Tide owns a 34% share of Amazon’s Laundry Detergent Best Sellers, whereas Seventh Generation owns 10%. With 96% paid visibility against its own branded terms, Seventh Generation is aggressively promoting EasyDose, even at a potential risk of cannibalization. Tide Eco-Box, meanwhile, had only 32% paid visibility against its own branded terms during April 2019. On the other hand, Tide Eco-Box is more focused on converting undecided buyers, and it achieved 63% organic visibility and 34% paid visibility for nonbranded laundry terms — higher than the mere 25% organic and 22% paid visibility achieved by EasyDose against nonbranded keywords. It is paying off.

for Tide Eco-Box, which quickly rose to an average rank of 12 on Amazon’s Liquid Laundry Detergent Best Sellers within three months of its launch. Meanwhile, EasyDose’s average rank is 63 even six months after launching. Unlike the traditional arrangement with brick-and-mortar partners, multiple layers of supply chain costs quickly pile on for e-commerce fulfillment, challenging CPG brands to create more profitable unit economics. It is still too early to call the verdict on Tide Eco-Box and Seventh Generation EasyDose. However, Tide proves that brands have to be prudent and support new launches on Amazon with ads to boost visibility and build awareness higher up in the sales funnel to enter the Amazon sales flywheel.