Driving Growth Through Innovation – Part 2: Retail Tissue

Stagnation in developed Retail Tissue markets prompts demand for innovation

Product innovations in developed markets are targeted at convincing consumers to pay a premium price for value-added benefits, as there is little room for volume growth. However, in tissue, pricing remains a key factor in purchase decision-making. Products that are unique and offer a clear benefit to consumers, rather than just another softer and stronger product, are more likely to attract consumers.

Localisation is an important consideration in value-added innovations, such as packaging, design, and ingredients

Several recent product launches included an element of localisation. While scented tissue products are popular in several markets, the preferences for scents vary, which is an important consideration for manufacturers operating globally. Design innovations that partner with local organisations and artists help generate buzz around the product. Packaging innovations must also take into account consumer lifestyles and needs in order to provide meaningful value.

Opportunity for cross-border innovations

Products created for domestic markets may benefit from expansion into additional international markets, based on similarity in consumer needs and buying behaviour. For example, the UK’s Better All Around Ora paper towels have proven to be successful in the US market as well, due to the innovative nature of the product format.

Growth opportunities lie in developing markets, creating need for low-cost and efficient-use innovations

A significant amount of unmet potential in global retail tissue comes from developing markets, where consumer habits are beginning to change, leading to the expanded usage of tissue products. As a large portion of consumers in these markets tend to be from lower income households, the primary focus for innovation in these markets should be on cost reductions, as well as offering products that consumers can use efficiently, as an alternative to re-usable products.