5-20-18 10:26 PM EDT | Email Article
By Alessandra Malito 

Consumer-products makers are facing growing pressure from retailers and consumers to ensure products are free of risky ingredients. So in a move toward greater transparency, Procter & Gamble Co. is now disclosing the ingredients in most of its 3,500-plus consumer products on SmartLabel, a website where brands provide more detailed information about their products.

To access the expanded ingredient list, shoppers can use a smartphone to scan a product's QR code (a coded square on packages that, when scanned, brings smartphone users to a link) or go to the SmartLabel site and look up the product by name.

The move by the maker of Tide laundry detergent, Pampers diapers and Pantene hair products comes as big brands try to change the perception that their products contain harsh, unsafe or simply too many chemicals. It also comes as competition from smaller firms claiming to use only natural ingredients grows.

In an interview, Kathy Fish, chief research, development and innovation officer at Cincinnati-based P&G, talked about the plan for more transparency and a push to satisfy consumers' demands for more natural ingredients.

Edited excerpts follow:

Seeking balance

WSJ: Why do you think there is a growing concern about fragrances and chemicals in products?

MS. FISH: It started in the food industry more than a decade ago, which led to a desire to make sure the brands and products we use are safe and effective. That has expanded to include household and personal products, but unless you're a scientist it's hard to look at an ingredients list and know what they are. So we are committed to making information more transparent for those who use our products.

WSJ: Why not put all the ingredients on the package?

MS. FISH: Fitting all ingredients on labels is incredibly challenging, and nearly impossible, for many items. We would compromise friendly usage instructions. Those who want this information are seeking product information online before going shopping, and if they want more at the shelf, they almost always have a phone with them, so it is easy to access.

WSJ: How will P&G balance the goal of transparency with keeping product secrets safe?

MS. FISH: Most of our products are protected through patents. And ingredients are just part of it. There are many other things that go into product development, such as sourcing and quality, how we manufacture and how we make sure that products are stable.

WSJ: It seems like SmartLabel enables companies to describe ingredients in a neutral or positive way. For example, the description of fragrance on one Pantene product says, "Makes hair smell great." Is product promotion part of why you are doing this?

MS. FISH: We formulate with things because they do have positive benefits, and this is an opportunity to educate consumers about what an ingredient is and why it's there. We aren't trying to mislead people. We know our products are safe or we wouldn't sell them. We now give more ingredients and why we use what we do.

WSJ: Listing an ingredient as "fragrance," may not mean much to consumers. Is P&G planning to disclose the chemicals that go into fragrances?

MS. FISH: Fragrances in general have captured both consumers' and advocacy groups' attentions, largely because the ingredients in fragrances aren't disclosed. And in reality, some consumers have sensitivities to fragrances. We plan to disclose fragrance ingredients by the end of next year. It is a work in progress.

Within each fragrance, this means nearly 100 ingredients could be disclosed.

What consumers want

WSJ: Is there a sense of urgency within P&G to get more natural ingredients into your products?

MS. FISH: We see a shift toward consumers wanting more naturals, and there is always urgency to meet consumer needs. The challenge is that natural means different things to different people. It can mean what is in a product or what isn't in a product. Interestingly, there is no legal definition of what natural means, so it is important to understand what a product is claiming. It may have natural ingredients but not be all natural.

WSJ: Is that why P&G is using the word "pure" more now?

MS. FISH: Our approach is to understand, for each of our brands, what consumers think is important and design accordingly. It is up to each brand team to name products in a way that will resonate with their consumers. We have used "pure" on products such as Tide Purclean and Pampers Pure Protection because the name signals a very deliberate product design, and the additional information on the package provides a better definition on what "pure" means. Pure can mean free from specific ingredients or full of good things like ingredients derived from plants.

WSJ: What is the company doing differently to develop more natural products?

MS. FISH: We are committed to being very forward-looking in our approach, which means addressing pain points. Breakthroughs in technology can address that in meaningful ways. Tide Purclean is a great example. The consumer pain point was wanting the same performance as Tide but with plant-based ingredients, and to achieve superior cleaning even in cold-water washing conditions, which are the most energy efficient. In addition to having 65% plant-based ingredients, Tide Purclean is produced with 100% renewable wind-power electricity at a facility with zero manufacturing waste to landfill.

[Buyers of natural products] think they have to sacrifice performance. We are taking on the challenge to solve that trade-off and deliver core brands in a much more natural way.

That also involves entrepreneurship. What we find is with passionate founders and access to key decision makers, [product development goes] much faster. One great example is the recent launch of Pampers Pure. The young scientist [behind the idea] had premature twins and wanted Pampers in a more natural way. She became one of the founders of Pamper Pure, which we launched. The team was able to get it to market in 18 months, versus the standard three years.

WSJ: Does having natural ingredients mean you have to sacrifice performance?

MS. FISH: We are very committed to our core products striking a balance. A lot of natural products are about taking things out or removing ingredients that consumers are concerned about. That isn't innovation. That is diluting the product, so we are instead looking at ingredients that are sourced in more natural ways. That requires innovation and strong quality-control systems, as there tends to be more variability.

In general, ingredients that are formulated vs. harvested or naturally sourced have less variation as they are controlled to meet specifications; nature isn't as reliable, and just as you may find fruits and vegetables of varying flavor, appearance and other characteristics, this is true of all naturally sourced materials.

So first we evaluate and confirm that any new ingredient is fully safe and effective, and then we focus on ensuring that our supply of that ingredient meets our specifications.

WSJ: It seems competition in natural products has increased greatly. For example, some brands thrive on being natural ingredients only -- such as Method and Mrs. Meyers. How do you compete on this level when your brands aren't known for natural ingredients first?

MS. FISH: The natural segment has definitely been growing fast, but it is also still small due to trade-offs in performance, so I think we are well positioned to compete and win. It is also up to us to communicate that clearly to the consumer.

WSJ: How can naturals consumers trust such a large company not initially built on a brand for natural products?

MS. FISH: When we think about this, we start with, "Who could be more trusted than P&G?" We have been around more than 100 years. We have brands that are decades old and have the trust of consumers over that time frame. The challenge of naturals is really no different, and we are fully on it now. We expect to be very successful, and early market results of launches have reinforced that.

Ms. Malito is a reporter for MarketWatch in New York. Email her at amalito@marketwatch.com.

 

(END) Dow Jones Newswires

May 20, 2018 22:26 ET (02:26 GMT)

Copyright (c) 2018 Dow Jones & Company, Inc.
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