Seventh Generation Products Gain Better Position on the Shelf
By Linda Winick
Sales of “green” household cleaning products continue to increase in mass market stores, but a critical merchandising decision persists: Shelve eco-friendly products in a separate section or blend them with non-green cleaners?
That’s easy, said Sarah McLaren of Seventh Generation, a Burlington, Vt.-based maker of green household products. Since it’s a challenge to get green products in front of consumers, stock them alongside conventional products on the shelf so consumers can choose what’s right for them.
“A lot of times, conventional retailers are putting green products in separate aisles or separate sections of the store,” said the brand manager of home care, laundry/paper/trash. “Consumers are walking down the aisles and not even seeing [green products] because they may not be going to that section of the store. However, when the consumer finally finds where the product is, they are more likely to pick up the product. There is a very high conversion rate. Eighty-four percent of them – once they find it – put it in their cart. It’s really valuable for the retailer,” she said in a presentation at the IRI Growth Summit recently in Nashville, Tenn.
Consumers of natural products are shopping at five more retailers than consumers. This is largely because shoppers can’t find what they are looking for all in one store. In fact, only 31 percent of shoppers interested in purchasing natural products say they can always or often find the items, said McLaren.
Research conducted by IRi found that 75 percent of the new buyers of Seventh Generation products are purchasing them in traditional food and mass stores.
“Food and mass stores are where we’re seeing the most growth for green products,” said another presenter, Emily Whitney, consultant, consumer insights, with IRI. “A lot of this is tied to smarter green category management, especially at Target and Kroger. So it’s getting these green products out in front of consumers. Now that Seventh Generation is here on these shelves, they’re getting a lot of line of sight that they didn’t have before.”
As consumers continue to adopt greener lifestyles, sales of environmentally conscious products are becoming mainstream. They are growing at a far great rate at traditional retailers than at natural grocers, which originally offered the best assortment.
Seventh Generation has focused its marketing efforts on these eco-friendly consumers and has achieved strong growth over the years. McLaren said the company has engaged with the green consumers while also bringing in new green-learning consumers through effective media and shopper marketing initiatives.
The bad news is that while 61percent of consumers believe that environmentally conscious cleaning products are better for them, only 25 percent are buying products such as natural laundry detergent.
“The good news is that the green trend is really catching on. And four out of five Millennials are green-leaning, even though they are just starting to enter the category,” McLaren said.
While the green category grew 5.5 percent from 2012 to 2015 compared to a 0.3 percent decline for conventional home cleaning products, there are several barriers to purchasing natural products. McLaren listed four of them:
- Availability (“They’re not available where I shop.”)
- Price (“Green products are too expensive.”)
- Efficacy (“I don’t want to sacrifice product performance.”)
- Execution Excellence (“I don’t know why I should choose alternatives that are environmentally friendly.”)
She said the business challenge for Seventh Generation is to optimize marketing spend to recruit “green-leaning consumers.” To that end, the company uses IRI's Liquid Modeling for objective insights into consumer response to marketing across channels.
As well as household cleaners, Seventh Generation makes products for baby care (shampoo, lotion, shampoo) and feminine care (organic cotton tampons, chlorine-fee pads and pantiliners).
For the 52-week period ending March 19, 2017, sales of Seventh Generation products in multi outlets increased 14.3 percent in units and 14.8 percent in dollars compared to the year before, according to IRI, the Chicago-based market research firm