Jun 11 2009
Jeffrey Hollender has made the decision to step aside as CEO of Seventh Generation, a company he grew to become one of the most iconic sustainable brands. He should be saluted not just for building a company of which social and environmental values have inspired many entrepreneurs but also for realizing what many entrepreneurs have failed to realize in time when the conjuncture of rapid growth and market switch call for a new set of skills. The newly appointed CEO, Chuck Maniscalco – a former Pepsico executive, will have the challenging task of growing the company from $150 million in annual sales to $1 billion in a market that should grow 873% over the next 5 years. But don’t think for a second Jeffrey Hollender will stop being the inspiration behind Seventh Generation conquest of the home natural products … he is still the Chief Inspired Protagonist after all.
The challenge might seem daunting for many as the green brand is facing increased competition from CPG goliaths Clorox (GreenWorks) and SC Johnson (Nature’s Source and recently acquired Caldrea and Mrs. Meyer’s) that have much more marketing power than 7Gen. Clorox claims to have conquered 42% of the natural cleaners market … in less than a year. We’re expecting P&G to enter the dance pretty soon. But 7Gen’s battle to reach its objective – let alone survive – is more complex than buying TV commercial time.
I strongly believe the 20 year-old pioneer suffers more of an image deficit than an awareness one. We teach to business students that being the first to enter a market confers many advantages and leverages. It may have been true for 7Gen but it is all relative and whatever they were they are almost insignificant today, except for a strong core of customers that experimented the products early and have since turned into loyal – and for some fervent – supporters (Jeffrey Hollender calls them the deeper green community). Carving a market share, setting up standards, owning the message space and so on have relative weight in a low-interest product category in which cheaper and more efficient chemical cleaners have traditionally prevailed. And here starts the list of reasons for not purchasing – let alone trying – 7Gen products: expensive and less potent. Prior 2007, the concern over chemical products and the subsequent responsibility to using environmentally friendly alternatives were hardly a topic of the mainstream, so were green cleaning and 7Gen. However, 7Gen did generate some buzz, thanks to its charismatic and visionary CEO, but it was as often if not more, counterweighted by an image of “products that do not do the job”. And this – underserved – image (that 7Gen might share with others) is today the biggest drawback Maniscalco will have to address. Without much makeover, 7Gen could – and that would be one of my recommendations – use the power of nature to pump up its image. In my line of work, I have tested countless cleaners and detergents, and yes, 7Gen products work as well as, if not better than its direct competitors, green or chemical based (excluding disinfectants and sanitizers).
The second (the first really) is anchored in 7Gen’s genes: it is what it said it does: it is an ethical business, whether it is on social and environmental issues or its business conduct. It is a laudable business behavior, but the standards the company has set for itself on the latter might come as a disadvantage. Understand this, 7Gen is the pioneer of green cleaning and is manufacturing the greenest cleaners of all. Method and Clorox’s GreenWorks “green” strategies address the issue of green cleaners’ lack of potency directly, and the former does not hesitate to remind its audience that “all natural/ green cleaners is not a choice” – because driven by potency and price – while the later rightly believed Clorox is a trusted brand, and while highlighting the limitation of All-Natural cleaners, one does not hesitate to perjure itself by inching it uses some sort of synthetic/ chemical blend and the other affirms without any detour that “trust me, green does work”. Is the world of green cleaning falling on its head? No, not really. Method is aware of the image deficit of pure green brands, and the aesthetic of its containers is not enough to balance the perceptual deficit that comes with pure green. So the people against dirty make sure you understand they do not compromise with dirt, they give you a product that works in a very pretty packaging while assuring you that everything is done on their side to preserve the environment and your health. As for Clorox, they know where their strength lays: brand management and marketing dollars. I’ve written how uncomfortable their TV commercial makes me feel (http://www.green-age.org/blog/tag/clorox/). But what can we do, they are very efficient in making people trust them. Recently, Method went head to head against Clorox in a battle of the bay when the Oakland based giant claimed to have introduced the “first all-natural wipe on the market.” The San Francisco based company replied through the blogosphere claiming they, and no others were the first ones to have used all-natural cleaning wipes. That was not true either, CleanWell did provide celluloid corn based wipes before Method. And 7Gen? Not a word. You’ll find Jeffrey jabbing at Clorox bleach products on his blog, or when someone tries to instigate a foe between Method and 7Gen, 7Gen offers instead to deepen the dialogue between the two companies. Although I believe 7Gen has the right approach, I wonder how much buzz they would benefit from jumping in these battles.
Reading both Hollender and Maniscalo’s announcements, one particular topic brought a smile on my face. They plan on bringing more sustainable products to the main stream. That is very good news. There is one product category that has enjoyed rapid growth in the last 10 years and that has been relatively untapped by green companies, one that desperately needs them: antimicrobial products, from hand soaps to cleaner disinfectants and from air purifier to toothpaste. I would not be a bit surprise to see 7Gen build a strategic alliance with CleanWell. One possesses the market reach and the other one the technology.
That’s it for now. Thank you Jeffrey for all your hard work and the tons of inspiration you gave us through your many endeavors. Very glad you made it that far. And Mr. Maniscalo, welcome and good luck!
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