Summary List Placement
Soon after Rod Little became CEO of Edgewell Personal Care’s business in 2019 he started looking for which brands to sell-off. The feminine care business was on the shortlist.
Edgewell is best-known for brands including Schick razors, Banana Boat sunscreen, and Wet Ones wipes. These brands have remained steady over the years, while the company’s feminine care business, which includes Playtex, Stayfree, has faltered. Sales at the segment fell 6.3%, the worst result at any of Edgewell’s segments during its 2018 fiscal year.
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“We actually went through a strategic alternatives process, and looked to divest it,” he said. “We could have explained it to the street and made sense out of it.”
As Little dug through the financials and structure of Edgwell’s feminine care business, though, he realized that the underperformance was the result of neglect — Playtex and Stayfree were consistently lower on the company’s list of priorities than brands like Schick, he told Insider in an interview.
“Immediately, the light bulb went off,” he said. “I thought, ‘We don’t even know what we have, and this business has not had any love or priority for a long period of time.'”
Tampons and pads are only Edgewell’s third-largest business, behind razors and skincare products like sunscreen. But Little told Insider that Edgewell sees potential in the category, which Mintel estimates represented $4 billion in US sales in 2020.
“Before me, but certainly over the last couple of years, we’ve not invested in the category. We’ve been in more of a milking position because the category did not have priority,” he said. “We’ve put priority back into fem care and deemed it a key category for us.”
Sales of Edgewell’s feminine care products were down 3.1% to $299 million for the company’s 2020 fiscal year, which ended in September. Little’s immediate goal is to increase distribution and get sales to roughly even year-on-year, he said.
Previously, feminine care shared many key staff, such as sales teams, with other Edgewell brands. This arrangement meant that Playtex and Stayfree lost space at store shelves, causing overall sales to drop.
Little established a separate structure just for the segment, including its own sales team. Edgewell is also investing in launches of better-for-you and organic products for 2022, having already culled products that weren’t working for the company since Little became CEO.
Those launches could help it compete with DTC brands like Top, Thinx, and The Honey Pot. Executives at those companies pointed out early in the coronavirus pandemic that sales of their products held up better than other personal care items. Sales of razors and some shaving products, for instance, have suffered as far fewer people work at offices or go out in public regularly. But at Top, for example, a maker of organic, eco-friendly pads and tampons, its monthly subscription program had increased by 100%, according to a spokesperson.
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Source:: Business Insider