Lower shipping costs and higher profitability for e-tailers—Check. Reduced production costs and carbon footprint for manufacturers—Check. Minimized damages during shipping and more compact storage for consumers—Check. Seventh Generation EasyDose, launched in October 2018, and Tide Eco-Box, launched in January 2019, are designed to do exactly that. Seems like a win-win-win. But is it too good to be true?
P&G and Unilever have literally thought outside the bottle with their new products. But their success will first and foremost depend on how well consumers buy into the newness and convenience of this concept. Given the unconventional design, both brands have taken to product pages on their brand site as well as e-tailer sites to educate consumers about the new design with easy, in-context visuals and how-to videos. However, new products, even in the case of line extensions, depend heavily on Push marketing at their infancy to get the consumers to this content.
Tide’s savvy utilization of headline ads (now called sponsored brands) and sponsored products was key to Eco-Box’s accelerated ascent to the twelfth position in the Liquid Laundry Detergent bestseller charts by May 2019. Headline ads can be a powerful tool to drive awareness, particularly during new product launches. The brand showed a willingness to divert spend away from its long-time hero Tide Pods, instead, featuring Eco-Box as one of the three products. In early February, prior to the Eco-Box launch, Pods accounted for 82% of the products appearing in Tide’s headline ads against both non-branded and branded keywords. By April, that share was diluted down to 61%, with Eco-Box now controlling 23% of those placements. In contrast, Seventh’s Generation’s strategy on Amazon seems targeted towards upselling to its existing customers. Seventh Generation drove 91% organic visibility and 96% sponsored product visibility against its own branded terms, in an effort to leverage strong brand affinity to push shoppers to the new product according to Gartner L2’s report on the topic.
It remains to be seen how e-tailers like Amazon will reward manufacturers for e-commerce centric packaging. Will they receive the coveted Amazon’s choice badging or preferential placement by adapting to Amazon’s increasingly stringent profitability goals? It’s still too early to call but Tide and Seventh Generation will likely continue to invest in their new product to drive discoverability, consideration, and conversion. The challenge for both brands will now come not only in acquiring new customers, but in ensuring that those who have converted to the new format remain loyal, rather than returning to the less profitable, legacy offerings.