Growth Despite Challenges.
Retailers could win by offering wipes that address consumers' health and environmental concerns -- and deliver value and performance.
With so-called "flushable" but not dispersible wipes clogging city sewer systems and concerns about chemical formulations growing, the disposable wet wipes sector has confronted its share of controversies. Nevertheless, wet wipes as a category, and especially store brands in that category continue to post strong dollar sales growth as the industry addresses consumers' apprehensions while introducing highly specialized and convenient new products.
IRI, a Chicago-based market research firm, reports that U.S. retail sales of store brand baby wipes, the largest subcategory, rose 3.5 percent during the 52 weeks ending May 15 (see the table, p. 60). Unit sales fell slightly, however. The drop isn't surprising, given that millennials are having fewer babies than any other generation in history did in their 20s and 30s, according to an April Urban Institute report titled "Millennial Childbearing and the Recession."
But millennials are also known to spend more for products that reflect their values and priorities. For example, in its October 2015 report, "The Sustainability Imperative: New Insights on Consumer Expectations," New York-based Nielsen notes that 73 percent of millennials globally are willing to pay more for sustainable products.
And in the more robust personal care "moist towelettes" subcategory--defined by IRI as including toddler wipes, adult moist toilet tissue and a variety of hand wipes -- store brands saw a dollar sales gain of 12.5 percent and a unit sales increase of more than 9 percent.
Millennials favor wipes that contain fewer chemicals and gentler cleansing agents, says Aileen Vitale, sales and marketing manager for Disposable Hygiene, LLC, Clifton, N.J.
"It's across the board, whether you're talking about facial wipes or household cleaning wipes, millennials and increasingly other consumers don't want to see certain chemicals, including parabens, phthalates, formaldehyde, chlorine and alcohol," she notes.
Lucienne DePonte, senior category director for Nice Pak Products, Orangeburg, N.Y., agrees that "millennials take a minimalist approach to the products they use." They want to know what's in consumable products, including wet wipes, and prefer those that contain natural ingredients to the largest extent possible.
To better target millennials and seize this essentially untapped opportunity, retailers should look for private label manufacturing partners that can produce natural-ingredient wipes, DePonte suggests. Retailers should then work with these manufacturers to come up with eye-catching visuals and effective messaging to promote the environmental and health attributes of such products on packaging, shelf extenders and signage.
Germ fighters spell opportunity
Industry consultant Phillip Mango of Summerville, S.C., points out that household cleaning and disinfecting wipes are also poised for significant gains because consumers have become increasingly concerned with microorganisms as a result of outbreaks of severe acute respiratory syndrome, methicillin-resistant Staphylococcus aureus and the influenza viruses H1N1 and H5N1.
As consumers are starting to realize, according to Mango, disinfecting wipes that kill 99.9 percent of household germs work better than traditional cleaning solutions that are squirted on a surface and wiped dry with a paper towel.
"With a spray, you might use too much or too little," he explains. "With wipes, you automatically have the right amount of the disinfectant formulation. You just need to wipe the surface and let it air-dry -- it's almost foolproof."
Most wipes not flushable
A March 13, 2015 article in The New York Times titled "Wet Wipes Box Says Flush. New York Sewer System Says Don't" describes how flushable but intact wet wipes combine with other materials to form indestructible clusters that clog municipal sewer systems. Newspapers in many other cities have published similar stories. The nonwoven industry so far has been hit with 15 lawsuits related to flushability, with retailers such as Target and Walmart also named in these suits.
Mango explains that certain manufacturers previously claimed that their wipes were flushable simply because they were small enough to fit through pipes in residential plumbing systems. According to the industry's Code of Practice, only wipes that are "dispersible" -- that disintegrate once in water -- can be labeled flushable today.
New nonwoven fabrics are emerging, however, that not only boast improved dispersibility for septic and sewer systems, but also feature better cleaning action/soil holding and a synergistic combination of the solution with the fabric, explains Greg Fries, vice president of marketing for Guy & O'Neill Inc., Fredonia, Wis.
"There is also a trend pushing for biodegradable or compostable products without sacrificing any product perforance," he says, adding that the era of national-brand-equivalent wet wipes is over, with national-brand-equivalent-plus or even national-brand-better products necessary for retailers to realize own-brand success.
But for non-flushable wipes, industry guidelines specify that when they are likely to be used in or near bathrooms, manufacturers need to put a prominent "Do not flush" warning on containers and packaging. Retailers should make sure that their store brand baby wipes, cosmetic wipes and other nonflushable wipes carry the appropriate cautions, Mango says. And merchandising signage should clearly warn consumers not to flush nondispersible wipes.
Despite such concerns, the wet wipes category is exploding with new products. Although they care about sustainability, millennials also crave convenience and variety, Mango says.
"Unlike previous generations," says Mango, "millennials tend to want something unique and special for the job."
Today, there also seems to be a wipe for every purpose -- expanding opportunities for store brands. For instance, Boogie Wipes are designed for wiping toddlers' noses. And dog owners, meanwhile, will find ear wipes, eye wipes and dental wipes, on top of general-purpose grooming wipes, for their four-legged friends.
In addition to responding to these new opportunities, retailers should give own-brand wet wipes an advantage via merchandising.
For one thing, they should cross-merchandise private label personal care wipes more creatively, in Vitale's opinion. Typically, wet wipes are found only on the shelf near their brand-name counterparts.
"Retailers should put an assortment of their store brand wipes at one end of the store or on an end cap," Vitale advises. "Be proud of your brand. Promote its unique qualities," she advises retailers.
To stimulate impulse purchases, stores could also display travel-size packets of private brand hand wipes at checkout counters alongside lip balm, tissues and other useful items.
keep in mind that millennials favor wipes with fewer chemicals and gentle cleansing agents.
forget to warn consumers on-pack against flushing nondispersible wipes.
consider product development opportunities in men's care, pet care and other growing wipes subcategories.
forget to communicate the health and environmental positives of own-brand wipes on-pack and near the shelf.