MARKETING CAMPAIGN

Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 1 OVERVIEW Catalyst In 2010, Procter & Gamble's (P&G's) Fairy Liquid brand recorded particularly impressive growth rates in both the auto and hand dishwash product categories in the UK. The growth in sales has been attributed to a heritage marketing campaign designed to celebrate the 50th anniversary of the brand. This case study analyzes how Fairy Liquid has successfully managed to introduce a nostalgia-based marketing campaign while also leveraging superior efficacy benefits compared to competitors to enhance value perceptions of the brand. The case study also looks at how P&G plans to launch another evocative marketing campaign for the Fairy Liquid brand in 2011.

Summary • The Fairy Liquid brand recorded a year-on-year growth in sales value of 13.1% in the hand dishwash category and 24.2% in the auto dishwash category in 2010. A heritage campaign designed to celebrate the 50th anniversary of the brand has been touted as a key driver behind the growth. • The fast moving consumer goods (FMCG) sector saw the use of nostalgia-based marketing themes become particularly common throughout the economic downturn and in the early stages of the recovery, as consumers sought out products that reminded them of simpler and happier times from their past, something that the Fairy Liquid brand has capitalized on.

• In 2011, it was announced that P&G would launch a commemorative Fairy Liquid bottle design to celebrate the royal wedding of Prince William and Kate Middleton. The brand is well placed to capitalize on enhanced feelings of patriotism among UK consumers through its heritage and ability to leverage authenticity traits related to country of origin. CASE STUDIES SERIES Fairy Liquid Case Study Using evocative marketing techniques to boost product sales Reference Code: CM00117-007 Publication Date: March 2011 Fairy Liquid Case Study Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 2 ANALYSIS Fairy Liquid: capitalizing on nostalgic and evocative marketing and packaging cues The Fairy Liquid brand has managed to create an emotional attachment with UK consumers through its long-term presence in the market and well established family-themed marketing campaigns. The brand performed particularly well over 2010 and this was attributed to a heritage campaign that P&G launched to commemorate the 50th anniversary of the release of Fairy Liquid. This case study examines how Fairy Liquid was well placed to capitalize on the growing popularity of nostalgic products/marketing, and how it has effectively combined efficacy and emotive marketing to differentiate from its competitors.

The Fairy Liquid brand witnessed impressive growth rates in 2010 In its Top Product Survey 2010, carried out in association with Nielsen, The Grocer touted P&G's Fairy Liquid brand as having a particularly successful year:

• In the auto dishwash category, the Fairy brand generated sales of £50.5m, which was a year-on-year sales increase of £9.8m. Although this was the second leading brand behind Reckitt Benckiser's Finish, which generated revenues of £132.4m, the year-on-year growth rate in sales of Fairy (24.2%) was considerably higher than that recorded by Finish (3.1%). • In the hand dishwash category, Fairy Liquid further boosted its already well established presence as the market leader over the 12-month period. It recorded annual sales of £127.2m, accounting for two-thirds of total sales in the product category and recording an impressive growth rate of 13.1% Fairy Liquid Case Study Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 3 Figure 1: Fairy recorded impressive sales growth in both the auto and hand dishwash categories in 2010 Top 3 Auto Dishwash brands, UK, 2010 Top 3 Hand Dishwash brands, UK, 2010 Brand Label Sales £m Sa les change (£M) Sales change (%) F i ni s h R ec k it t B e n c ki s e r 1 32 .4 3. 9 3 . 1 Fairy Pro cter & Gamble 50.5 9.8 24 .2 Ecover Ecover 2.8 -0.7 -20.5 Br a n d La be l S al es £m Sa le s ch an ge (£ M) S al e s c ha nge ( %) Fairy Procter & Gamble 127.2 14.7 13.1 Morning Fresh PZ Cussons 11.6 -2.3 -16.8 Ecover Ec over 6.0 -0.8 -11.4 Source: The Grocer/ Nielsen, Top Product Survey 2010, December 2010 D A T A M O N I T O R Datamonitor figures show that the rate of growth of Fairy in both the hand and auto dishwash categories over the last year exceeded the rate of growth experienced in the UK market overall. The Grocer also highlighted that private label brands fared worst in 2010, with sales of store-own brands of hand dishwash products falling by 8.7% and auto dishwash products falling by 10.4%. Interestingly, Nielsen figures also showed that in 2009 growth in private label was beginning to slip, with the value share by sales of store-brand hand dishwash products growing by only 0.1% compared to the previous year, and the sales share in the auto dishwash category falling by 0.6% over the same period. This suggests that consumers are still cautious with regards to private label dishwashing products being good alternatives to well established, market leading brands. This is also reflected in the fact that Datamonitor analysis, carried out in 2010, revealed that the penetration rate of private label offerings in the US household care market was just 9.0%, with the rate for textile washing products being 5.9%.

Table 1: Market value of the UK dishwash market,(£m), 2005–10 Category 2005 2006 2007 2008 2009 2010 CAGR 2005–10 Auto dishwash 148.9 159.5 169.3 177.5 185.5 193.6 5.4% Hand dishwash 193.9 197.9 201.6 205.0 208.2 211.5 1.8% Note: CAGR = compound annual growth rate Source: Datamonitor's Market Data Analytics D A T A M O N I T O R Fairy Liquid Case Study Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 4 Brand heritage has been touted as a key driver of growth in the market The success of Fairy Liquid has been attributed to a brand heritage marketing campaign to celebrate its 50th anniversary, including the re-launch of the brand's distinctive white bottle and the on-screen re-appearance of Nanette Newman, star of the brand's original television advertisements. "The campaign has driven record share and cemented the brand position in the nation's heart for years to come." Geraldine Huse, P&G customer business development manager, quoted by The Grocer, December 2010 P&G celebrated the 50th anniversary of Fairy Liquid through leveraging brand heritage In January 2010, it was announced that throughout the year P&G would celebrate the 50th anniversary of the launch of the Fairy Liquid brand with a marketing campaign focused around the brand heritage and long-established credentials of the dishwashing product. This included a nostalgia-driven ad campaign that involved bringing back Nanette Newman, as well as the use of print images looking to emphasize the heritage of the brand. P&G also reintroduced the well-recognized and distinctive Fairy Liquid white bottle for a limited period, as well as re-designing artwork across the brand's hand and auto dishwash product portfolio. The heritage marketing campaign was also used to leverage the quality credentials of the brand, with the marketing push to celebrate the anniversary using the tagline "Trust Fairy cleaning power!" to reiterate efficacy-related claims. Meanwhile, the auto dishwash portfolio was promoted as being "50% tougher on grease" to help differentiate the brand from alternatives on the basis of efficacy and trust.

The Fairy website was also redesigned to commemorate the anniversary of the brand's launch, celebrating the past 50 years during which it has been stocked in the UK retail sector. This included uploading themed video footage of the UK over the last half century, including titles such as "Looking Back over Five Decades of British Bank Holidays" and "Discover Fifty Years of Iconic Hairstyles with Fairy." Brand-specific videos were also uploaded, featuring Nannette Newman and television presenter Konnie Huq. Konnie Huq was particularly relevant due to her previous involvement with children's program Blue Peter, in which the Fairy Liquid bottle became synonymous with the section of the cult show where children are shown how to make different creations using basic household equipment.

Fairy Liquid Case Study Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 5 Figure 2: A heritage campaign was launched in the UK to celebrate the 50th anniversary of the launch of Fairy Liquid Fairy liquid advertising has looked to emphasize brand heritage Source: P&G, Fairy D A T A M O N I T O R Nostalgia provides a strong emotional pull in a price-driven market In April/May 2009, Datamonitor asked consumers in the UK what the main factors were influencing their buying behavior when it came to household care products. Although price was cited as the primary factor influencing purchase choice (64% of responses), there were a number of other attributes such as product effectiveness, ease of use/storage, and multi- purpose benefits that were identified as helping to significantly shape perceptions of value. The high proportion of consumers who stated that promotional incentives and habit have a significant influence on their buying behavior highlighted the issue that, even in less financially affluent times, consumers are reluctant to break from the routine of buying tried and trusted products. Indeed, in order to make shopping occasions more affordable, consumers would rather look to take advantage of promotional/pricing incentives on favored brands, rather than switching to cheaper alternatives. This goes someway to explaining why sales of private label have slipped based on the sources analyzed.

Fairy Liquid Case Study Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 6 Figure 3: There are a range of factors that have significant influence on product choice in the household care product category Price 64% P r om ot i o na l o f f er 55 % Ease of us e 51% Product's promise 45% Ha bi t 42 % Ease of storage 40% Multi-purp ose b enefits 38% Whether it s aves ti me 37% Sce nt/fragrance 27% Family p references 21% Na tural i ngredient s 20% B r an d i m ag e 19 % Ethics/sustainability benefits 13% Recommendations from friends/family10 % Level of influence Very high Hi gh Medium Lo w Very low How much influence do the following factors have in your choice of household cleaning and laundry products?, UK, 2009 Source: Datamonitor Consumer Survey, April/May 2009 D A T A M O N I T O R A key theme that has long been established in advertising campaigns for Fairy Liquid has been the link between the brand and family interaction. This has included adverts in the past featuring a young boy asking his mother why her skin was so soft after using the product. P&G looked to continue the family theme with the 50th anniversary heritage campaign, with the brand's website even carrying a section entitled "meet the Fairy family." However, beyond habit (42%), other attributes that can be directly linked to family values, such as family preference (21%) and recommendations from family and friends (10%), have been shown to have considerably less influence on product choice than benefits such as efficacy and convenience.

As such, it is important for manufacturers to recognize that nostalgia-based marketing (if successful) can elicit an emotional reaction from consumers that reminds them of happier and more care-free times, something that can help boost levels of mental well-being. This can bring these factors into play, as opposed to simply encouraging consumers to purchase a product because it is a family preference. Fairy Liquid Case Study Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 7 The importance of nostalgia has increased as a result of the additional pressures brought about by the economic downturn The influence of nostalgia on buying behavior is not a new concept in the FMCG market. In February 2004, for example, Professor Brian Wansink, director of the Food and Brand Lab at Cornell University, reported in Restaurant & Institutions magazine on how his research team had studied consumers in a cafeteria line and their subsequent buying patterns. While some foods were labeled in a cursory manner, others were given more evocative descriptions. "Grandma's homemade apple pie," for example, had better sales than a similar dessert with a less emotive description. The favorable connections to homemade flavor or sentimental attachment to family influenced immediate purchases and some repeat business.

Although the aforementioned example is food-specific, the influence of nostalgic marketing is relevant across the whole of the FMCG spectrum.

The recession had a severe impact on the mental well-being of UK consumers. As well as the financial concerns brought about by the downturn, the 2009 Datamonitor consumer survey found that 42% of respondents were dissatisfied with the quality and quantity of their sleep, while 40% said that their levels of stress had worsened in the six months prior to the survey being undertaken. This additional level of stress will have exacerbated the desire for a return to times that were simpler and more care-free, as summarized by psychologist Ben Williams in an article in British Airways' Business Life magazine.

"When times are good and life is easy, there is less nostalgia around, and when times are hard, people look back to the 'the good old days.' That is what's happening now. With the credit crunch, the recession, war in Iraq and Afghanistan, every time you turn on the news there is such grief – so people are looking back to more comforting times." Chartered psychologist Ben Williams, in British Airways' Business Life magazine, May 2010 The economic downturn led to a longing for the simple life As well as positive feelings of mental well-being brought about by reminders of fun and stress-free times, the favorable perception of nostalgic products can also be linked to consumers' desires to lead a more simple lifestyle. This has been brought about by factors such as the economic downturn leading to greater feelings of time scarcity and shoppers feeling that they are being subjected to choice overload when grocery shopping. This has resulted in consumers looking to streamline their buying behavior in order to lead a less complicated lifestyle and becoming less attentive to new product launches. Streamlining shopping behavior and sticking to tried and trusted brands also boosts favorable perceptions of nostalgic brands through the increased feelings of confidence among consumers with regards to the efficacy benefits of these products. Fairy Liquid Case Study Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 8 Figure 4: Consumers are increasingly looking to lead a less complicated lifestyle 1% 3% 43% 40% 14% Si gn ific an tl y l es s Less No more or less More Significantly mo re Compared to two years ago, is it more or less important living a less complicated lifestyle? UK, 2010 Source: Datamonitor Consumer Survey, July/August 2010 D A T A M O N I T O R Nostalgic marketing offers benefits for both the manufacturer and consumer As well as benefitting the consumer through enhanced feelings of mental well-being, nostalgia can also prove beneficial for manufacturers in encouraging shoppers to make impulse buys during times when spending is more considered.

Datamonitor research conducted during 2009/10, for example, found that 55% of respondents were making conscious efforts to stick to a pre-determined list when out shopping and 49% were looking to reduce spend on products deemed non- essential (product categories such as biscuits and confectionery, where there have been a number of high-profile nostalgic launches in recent years, have been particularly vulnerable to cuts in spending). Figure 5: There have been a number of high profile nostalgic launches in the UK confectionery market in recent years Ca dbury Da ir y Mi lk Caramel brought back the Caramel Bunny in the UK in 2009, popular in the 19 80 s and 19 90 s Nestle Milky Bar revived its popular “the red car and blue car had a race” advert for i ts Milky Way off ering, nearly three decades since it was last r egularly ai red in the country The Cadbury Wispa bar was re-i ntr oduced in the UK following an online social n etw ork in g c amp ai gn , fo ur years after it disappeared off shelves Examples of nostalgic-orientated re-launches in the UK confectionery market over the period 20 07-2 01 0 Source: Datamonitor analysis D A T A M O N I T O R Fairy Liquid Case Study Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 9 Additionally, research conducted last year found that half of all UK consumers said it was more important to buy private label in order to save money compared to two years previously. Given the continued concerns over levels of financial well- being among consumers, as well as possible worries over austerity measures being implemented in the country in the near future, these attitudes and behavioral traits will continue to influence buying behavior in the UK for some time to come.

However, research has shown that despite their best intentions, consumers find it increasingly difficult to stick to a set shopping list and avoid making unplanned purchases, and this means that nostalgic marketing will remain a useful tool in encouraging consumers to make non-essential, impulse buys, while also staving off the threat of cheaper alternatives.

"Nostalgia is a powerful emotional tactic that can make people buy a product without any logical analysis of its benefits." Niall McKinney, founder of online community UTalkMarketing, in British Airways' Business Life magazine, May 2010 Efficacy benefits are a key driver of sales of Fairy Liquid Although the heritage campaign has been cited as a key driver behind the solid performance of Fairy Liquid over 2010, it has to be remembered that price is the primary factor that influences choice of product in the household care market. Put simply, while nostalgia-based marketing can help create positive feelings of well-being that increase the chances of consumers becoming less rational and more impulsive in their product selection, the cost of a product can still act as an inhibitor (as well as a driver) regardless of the emotive nature of the marketing. This is something that will be of particular importance during periods when consumers look to make their shopping habits more cost-effective.

Despite trying to leverage brand heritage and attributes such as trust and efficacy, P&G did not give the limited edition bottle a premium price positioning. Indeed, it was announced in January 2010 that the 510ml limited edition bottle would carry a recommended retail price of £1.20, a price tag that fitted firmly between the £0.98 charged for a 450ml bottle and £1.38 for a 650ml bottle. This price tag will have further enhanced favorable sentiment towards the brand, as the nostalgic marketing would have provoked positive emotional memories at a price point that would have been deemed good value for money.

This focus on offering good value for money based on the efficacy and price of the product is a strategy that is well established by the Fairy Liquid brand. An analysis of the websites of leading supermarkets in the UK, for example, shows that the Fairy Liquid brand can easily be purchased on promotional offer and can also be bought at a competitive price compared to many store-own brands. The slightly higher prices per liter that do exist are justified because of the well established efficacy benefits associated with the Fairy Liquid brand.

Fairy Liquid Case Study Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 10 Figure 6: The Fairy Liquid brand looks to leverage value through pricing and promotional strategies combined with established efficacy benefits Tesco website includes promotional and pricing incentives for th e Fa ir y b ran d, Mar ch 2 01 1 Source: Tesco, March 2011 D A T A M O N I T O R P&G will release a limited edition bottle in 2011 to celebrate the UK royal wedding of Prince William and Kate Middleton In February 2011, it was announced that P&G would launch a limited edition Fairy Liquid bottle to celebrate the UK royal wedding of Prince William and Kate Middleton. The company has obtained royal approval for the commission and has already sent out instructions to agencies to design the bottle.

Research has shown that national events such as sporting competitions can lead to an increase in positive consumer sentiment through a sense of national unity and collective belonging, and this increase can result in an upturn in retail spending, with Verdict Retail estimating a £360m boost in food and grocery sales as a result of the royal wedding. This is because the sense of collective belonging taps into feelings of patriotism and a willingness to purchase products that express and emphasize national identity. Given the infrequency of royal weddings in the country and the generally favorable opinion geared towards the prince, FMCG manufacturers are well placed to capitalize on the increased positive feelings of UK consumers in the run-up to the event. Evocative marketing campaigns by these manufacturers will increase the likelihood of consumers making impulsive, emotional purchases as opposed to rational and considered buys. This is an opportunity that has also been recognized by other FMCG manufacturers. Fairy Liquid Case Study Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 11 Figure 7: FMCG manufacturers are looking to tap into feelings of patriotism in the run up to the UK royal wedding I n March 2011, it was announced that a decorative edition of biscuits would be released by McVitie’s to ce le br ate t he o c ca si on In Ma rc h 20 11 , Pr es tat an no u nc e d th e la un ch o f a new Union Jack th e med b o x of chocolates to coincide with the event FMCG ma nu fa c tur er s are l au n ch in g li mite d ed it io n o ffe ri ng s to coincide with the Royal Wedding “…whi le foo d an d gr oc er y r et aile rs c ou ld ca sh in t o th e tun e of £3 60 m as consumers buy extra treats to celebrate the occasion as well as champagne and wine to toast the happy couple….” Verdict Retail, November 2010 Source: Datamonitor analysis D A T A M O N I T O R This willingness to purchase products based on feelings of patriotism was demonstrated in 2005 when a limited edition design of HP Sauce went on sale at premium retailer Harrods with a mark-up of around 300%. The limited edition design was part of a celebration of the retailer's Truly British season, with the label being designed by British designer Paul Smith and each bottle coming with its own certificate of authenticity. It was reported that the first 500 bottles sold out in a matter of hours, and that consumers had traveled from across the country to make a purchase, meaning that subsequent deliveries had to be limited to one purchase per person.

Although marketing literature accompanied the announcement of the limited edition royal wedding Fairy Liquid bottle, there was no mention as to whether the product will command a premium price. On this point, it has to be remembered that the limited edition bottle to celebrate the 50th anniversary of the brand did not have a significantly higher price tag. If the limited edition of the brand for the royal wedding does not carry a premium price tag, P&G will be able to enhance value perceptions through evocative packaging and marketing cues (particularly because of Fairy Liquid's ability to be positioned as an iconic British brand), without concerns that the price will impact perceptions of value. Fairy Liquid Case Study Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 12 Conclusion and implications: brand heritage and levels of trust with regards to efficacy mean that Fairy Liquid is well placed to continue to differentiate from other products through evocative marketing claims • While buying behavior and perceptions of value in the dishwash market are more commonly associated with factors such as efficacy and price than emotional marketing and packaging cues, the long-established quality credentials and heritage of Fairy Liquid mean it is well equipped to capitalize on the more evocative attributes that influence purchasing habits.

• The history of Fairy Liquid has helped to firmly establish its quality and credibility, and this combined with family-themed marketing over the last half century has also helped transcend issues such as trust and reliability in favor of more emotionally orientated feelings linked to periods of comfort and reduced stress.

This factor, in addition to the brand also having a competitive pricing strategy, means that Fairy Liquid is able to effectively position itself as a better alternative to private label/cheaper offerings.

• The launch of the limited edition bottle to commemorate the royal wedding of Prince William and Kate Middleton is well placed to capitalize on the positive sentiment and feelings of national pride that the event will create. This will particularly be the case as authenticity cues (the display of the Royal Warrant on the packaging) and brand heritage (Fairy Liquid's ability to position itself as an iconic British brand) can help tap into feelings of patriotism within the country and encourage emotionally led impulse buying.

Fairy Liquid Case Study Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 13 APPENDIX Case study series This report forms part of Datamonitor's case studies series, which explores business practices across a variety of disciplines and business sectors. The series covers a range of markets including food and drink, retail, banking and insurance, pharmaceuticals, and software.

Each case study provides a concise evaluation of a company that stands out in some area of its strategic operations, highlighting the ways in which the company has become one of the best in its field or how it deals with different problems encountered within that sector. Methodology This case study draws upon a mix of primary and secondary research, including Datamonitor's Market Data Analytics database and Product Launch Analytics database, alongside an extensive review of secondary literature and other in- house sources of information. Data have also been selectively extracted from the findings of the consumer fieldwork conducted for the purpose of Datamonitor's New Consumer Insight research. Secondary sources Business Life (2010) The nostalgia boom: Buying into the past, http://www.babusinesslife.com/ , May 2010 Marketing Magazine (2010) Fairy brings back iconic white bottle to celebrate 50th anniversary, http://www.marketingmagazine.co.uk/ , February 2010 Marketing Week (2011) Fairy Liquid to be redesigned for royal wedding, http://www.marketingweek.co.uk/ , February 2011 MHP Communications (2010) Why big brands are reviving their trusted brand icons, http://www.mhpc.com/ , October 2010 Talking Retail (2010) Fairy introduces limited edition retro bottle, http://www.talkingretail.com/ , January 2010 The Guardian (2010) Marketing 101: Bringing products back by popular demand: The departure of the Cadbury's Flake strapline may be just the first step in a canny campaign – next comes the "public outcry," http://www.guardian.co.uk/ , June 2010 Ask the analyst The Datamonitor Knowledge Center Writing team can be contacted at [email protected] . Fairy Liquid Case Study Fairy Liquid Case Study CM00117-007/Published 03/2011 © Datamonitor. This report is a licensed product and is not to be photocopied Page 14 Datamonitor consulting We hope that the data and analysis in this brief will help you make informed and imaginative business decisions. If you have further requirements, Datamonitor’s consulting team may be able to help you. For more information about Datamonitor’s consulting capabilities, please contact us directly at [email protected] . Disclaimer All Rights Reserved.

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