Reckitt Benckiser launched Dettol Kitchen Gel in India in February 2013, extending the country’s leading brand in surface care into hand dishwashing liquids, a category which is seeing
rapid growth. Positioned as a “complete kitchen cleaner”, Reckitt Benckiser expects to capture a significant share of the Indian dishwashing category by encouraging consumers to use one product for all cleaning tasks in the kitchen. Riding on its brand equity in household antiseptics/disinfectants, Dettol’s new launch implies the importance of adding value in product development while keeping costs down in order to expand in emerging markets where consumers’ disposable incomes are still low.
Liquid dishwashing growing in popularity
The Indian hand dishwashing category is dominated by bar soaps, led by Vim Dishwash Bar (Unilever) with a 54% value share in 2012. However, growing urbanisation in India is prompting
changes in lifestyle as consumers are increasingly using high-end crockery and glassware, on which consumer spending doubled over 2007-2012. This has resulted in consumers also trading up when it comes to cleaning products, shifting towards liquid formats due to their convenience and better performance. The upsurge in liquid dishwashing products in India has largely contributed to the dynamism of the wider dishwashing category, which recorded 12% growth in 2012.
The liquid dishwashing category in India is still at a nascent stage, with Pril Utensil Cleaner (Henkel) and Vim (Unilever) being the two key brands, holding value shares of 8% and 7%, respectively, in 2012. Dettol’s entry with its extra benefits of germ fighting and more importantly multi-surface cleaning is likely to shake up the competitive landscape.
Indian consumers’ health awareness may be surprisingly high even in a budget consumption culture. Consumer expenditure on household antiseptics/disinfectants in India accounted
for an enormous 58% share of surface care and 2% share of total home care in 2012, compared to 20% of surface care and 2% of home care in China, 6% of surface care and 1% of home care in Japan, 9% of surface care and 1% of home care in the US and 12% of surface care and 2% of home care in the UK. As Dettol is already the leading brand in household antiseptics/disinfectants in India with a 57% value share in 2012, it is likely that consumers will be willing to try out a new product that offers the convenience of cleaning both the dishes
and kitchen surfaces.
Such multi-purpose functionality resonates well with budget-minded Indian consumers due to their lower disposable incomes compared to consumers in other emerging markets. At US$0.30 in 2012, Indian per capita spending on dishwashing was still way behind that of Brazil (US$3.40), Russia (US$3.80) and China (US$1.10). That said, with per capita annual disposable income in India set to reach US$1,500 by 2014, a typical threshold for hand dishwashing sales to genuinely take off, the category could quadruple in size, reaching US$1.3 billion by as soon as 2020, when Indian consumers will be spending US$1 per capita on hand dishwashing, a level similar to that in China in 2011.
In addition, India’s 1.2 billion population is highly youth-oriented, with a median age of 26 in 2012 compared to 40 in China and 46 in Japan. With young consumers in India being more open to Western lifestyles, they will likely also be more receptive to switching from traditional bar soaps to liquid alternatives.
It is possible that Dettol may face sales cannibalisation in household antiseptics/disinfectants, which is expected to see absolute growth of US$19 million over 2012-2017. However, the
opportunities for growth in Indian dishwashing will far outweigh the risks.
Sophistication in the value bracket
With economic importance shifting towards the emerging markets, multinationals are stepping up their development in emerging economies so as to achieve sustainable long-term growth. However, product development is tough in emerging markets given consumers’ growing sophistication in terms of requirements, exacerbated by westernisation driven by the digital media, but also low per capita disposable income. Manufacturers will need to focus on both performance and price to attract consumers. In the case of Dettol, it should benefit from its multi-functionality while also keeping overall cost down. This will help the brand to create a niche, thus successfully avoiding direct competition with the leading brands Vim and Pril.
While the new Dettol launch may not be the pioneer of this format, with the likes of PZ Cussons’ Morning Fresh 3-in-1 expanding from dishwashing to multi-purpose surface care by
including the patented Byotrol barrier that promises similar antiseptic/disinfectant properties in Nigeria in 2011, Dettol’s entry confirms the rationale behind such product development going mainstream in emerging markets. Morning Fresh 3-in-1 has so far proved to be successful in Nigeria, even despite PZ Cussons’ limited marketing and advertising capabilities when
compared to those of Reckitt Benckiser.
How well Dettol Kitchen Gel fares in India could also have implications across the wider home care market, particularly in laundry detergents where powder formats dominate. Similar
product development trends in terms of combining extra benefits in a liquid format could support an easier transfer given the country’s youth-oriented demographic that does not stubbornly stick with old traditions. New product development in Indian home care will herald a new era of competition in the country.