Clean Slate: How COVID-19 will change the Home Care and I&I industry forever
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“We believe people’s perceptions about the importance of hygiene and disinfection will be permanently altered by this pandemic.” - Chris Hyder, VP GM Cleaning Division, Clorox, April 2020COVID-19 is catalyzing an unprecedented shift in consumer behavior. That shift translates to dramatic changes in purchasing decisions, which will affect the future of the Home Care and I&I market. Panic cleaning and empty shelves dominated the headlines in the beginning of the pandemic, but that was simply the first chapter. This pandemic is going to change our world forever. Here’s how.Hoarding got the headlines, but was this hoarding? Or a market shift?The online commentary ranged from amusing (“If you really need 40 rolls of toilet paper per person per week, you might want to visit a gastroenterologist”) to alarming (“Panicked consumers engage in physical fights over last container of wipes”). Hoarding got the headlines, with tales of families rushing to buy extraordinary quantities of household and home care goods as the COVID-19 pandemic set in.And yet, in the big picture of the market, is it really hoarding? Growth across several household and home care categories growth has been extraordinary, and yet experts suggest that – especially when it comes to cleaning products – the bulk buying wasn’t hoarding so much as a reflection of a real and trackable market shift.The shift is twofold: Firstly, consumers have dramatically elevated standards of cleaning at home, which drives a need for higher quantity and quality of products. We’ve been washing our possessions more frequently and more thoroughly, and cleaning surfaces more often. Secondly, all of us have changed where we’re spending our time. Rather than dining out, we’ve been eating at home, and that means doing dishes at home. Rather than going on vacation (with daily housekeeping service at the hotel or a cleaning service at the Airbnb), we’ve been racking up the wear and tear and dirt and grime at home.The second point is underscored by parallel reduction in spending on certain goods within the commercial industry. For every incremental sheet of toilet paper or drop of dish soap used at home, there has been a comparable gap in usage at the office, at restaurants, at hotels, at museums, parks, gyms, and at any other place outside the home.
While spring cleaning could account for a small percentage of the increases shown in the chart above, the pandemic outbreak is far and away the biggest catalyst for this explosive growth in a mature category. “We are working at full capacity in our manufacturing site to support the demand,” says Héctor Sepúlveda, Technical Director at Fábrica de Jabón La Corona, in Mexico. “COVID-19 has certainly increased the awareness of cleanliness and hygiene in people and homes.”Many industry insiders believe this growth will not completely reverse when the pandemic is behind us. Some consumers may have overpurchased, leading to a greater lapse in time before restocking becomes necessary. This is particularly true in areas that aren’t as directly related to the outbreak, such as bath tissue. But as for cleaning, people stocked up big time — and they’ve been using the products they purchased.
Before COVID-19, a family might have let a container of wipes languish in a cupboard for months. Now they’re wiping everything down multiple times per day, and monitoring online availability so they can purchase more as soon as shelves restock. The hockey stick growth seen in the wipes category in Q1 may not be sustainable, but it’s likely not going to experience a compensatory drop.The liquid laundry detergent category is perhaps one of the more surprising growth categories. With many workers swapping professional clothing for sweatpants (and hoping for audio-only conference calls), a drop in the category during the COVID-19 quarantine would have been reasonable. And yet, the overall trend toward cleaning more often and more thoroughly has more than offset the sudden loyalty to sweatpants. We’re filling the detergent load line to the max even if it’s a partial load, or using two pods instead of one. If we’ve been away from home, we’re dropping our exposed clothes directly into a tub of detergent and water when we return. Again, certain elements of this trend are likely to continue as we elevate our standards of cleaning for the foreseeable future.Consumer preferences make a hairpin turn
The answer: B.In March 2020, the claim “kills germs and bacteria in an effective way” was ranked by U.S. consumers as the most relevant claim for home care products, according to Nielsen Media.Given the importance of health and safety during a pandemic, product quality and efficacy have become key purchase drivers across CPG categories. We also know people are willing to pay more for products that are differentiated from other products.Translation: With the outbreak of COVID-19, consumers will pay more for a product if they believe that it will be exceptionally effective (more so than a competitor’s product) at killing germs and bacteria. Several producers of surface cleaners and sanitizers have seen increased demand for disinfecting products across both commercial and residential markets.This marks a notable departure from what was happening before the COVID-19 outbreak. Prior to the pandemic, consumer product claim preference was increasingly focused on natural ingredients, and consumers were willing to pay some premium for products featuring differentiated claims within those areas. The outbreak catalyzed a rapid and dramatic shift away from this natural trend. And while home care products that provide protection against germs are most top of mind while we’re in the grip of a global pandemic, there is compelling reason to believe that this shift in prioritization toward disinfecting and sanitizing will endure beyond this initial period of a paralyzing outbreak.What’s nextOf course, just as it was difficult to predict the onset and severity of COVID-19, it is difficult to predict with certainty where consumer behaviors will trend in the long-term. The key is for brands to stay connected with consumer preference shifts as they happen – and to anticipate that the pandemic will leave behind a permanent impact.One critical curveball to watch out for: As commercial institutions reopen and consumers begin to spend more time away from home, demand on the industrial and institutional cleaning side will naturally increase. But experts suggest that it won’t just recover to pre-COVID levels. Expect demand for any products related to cleaning to experience a significant spike year-over-year as businesses reopen and people feel more comfortable going out. “For many, leaving your home now feels like a risk,” says Clorox’s Hyder. “As people emerge from shelter in place and return to public spaces, they will be looking for reassurances that those spaces are clean and disinfected.”The desire to earn trust and win business will almost certainly drive reopened businesses to do exactly what the rest of us have been doing at home since the outbreak began: Clean more surfaces. Clean more often. Clean more thoroughly. Choose more disinfecting and sanitizing products.Seth Erdner, Business Director of Home Care I&I Solutions at BASF, says we can expect businesses to not only ramp up their cleaning standards for the long term, but to emphasize and even advertise those standards as a method of earning consumers’ trust and business. “Consumers are going to want to know how their airplane seat was cleaned, and how their hotel room was cleaned,” says Erdner.This trend has already taken flight, with several top hospitality companies making announcements. On April 21, Marriott announced the forming of the Marriott Global Cleanliness Council, which will focus on developing the next level of global hospitality cleanliness standards and will “tackle the realities of the COVID-19 pandemic at the hotel level and further advance the company’s efforts in this area.” Six days later, Airbnb announced the unveiling of a new Cleaning Protocol for hosts, with guidance from a former US Surgeon General. Two days after that, Hilton followed suit “in partnership with leading experts in hospitality and medical hygiene” with the launch of their North American initiative Hilton CleanStay with Lysol protection, “a rigorous system that incorporates RB’s trusted know-how and scientific approach to cleaning practices and product offerings,” with additional expertise given by Mayo Clinic’s Infection Prevention and Control team.
The proof is already here: more than ever before, a verified promise of cleanliness is going to be a selling point for businesses, and perhaps even a minimum cost of entry. (No restaurant wants to be the only one in town not emphasizing their newly elevated cleaning standards.)A comfortable solutionThis demand for elevated standards can be explained in part by the psychology of people’s habits. We as human beings are able to independently shape our lives, to understand and influence our surroundings, and, generally speaking, make our own decisions. This need for a sense of control heightens in the face of threats and uncertainty, or when we believe that we can’t have influence on the things happening around us. It’s easier for us to control what happens inside our homes than outside our homes, which can explain a trend toward “comfort cleaning” and even overcleaning.In public spaces, we need to rely on others to exercise control on our behalves, which is why assurances from the business community are going to be so important.And while the COVID-19 pandemic will (presumably) abate at some point, elements of the behavior shifts it catalyzed will almost certainly persist. The base level will remain higher than it was before, and we’ll continue to see spikes if and when subsequent biological or viral threats emerge in the future – likely with an even faster response. We’ve already seen that medicine is not always available as an immediate and comprehensive response to health crises, so consumers are doing what they can in the meantime – and that means reaching for disinfecting and sanitizing wipes and products. “The defense mechanism for humans will continue to be cleaning,” says Erdner.Household cleaning fills a basic human need, which falls between the core drivers of health, hygiene, and quality of life. It’s something we’re all willing to invest in, especially if it helps us feel like we’re doing what we can to combat threats to ourselves and our families.Clorox’s Hyder sums it up best:“This pandemic has created a new form of human accountability: The responsibility to keep yourself, your family, and those around you from becoming sick. Combined with the deeper understanding of the critical role disinfection plays in public health, there will be enduring changes to cleaning behaviors across consumer and professional markets.”