Question

The Arm & Hammer^® product—sodium bicarbonate—was introduced in the US in 1846 as “baking soda.” For the next 100 years, Arm & Hammer^® was a staple in the typical American home.

Church & Dwight Company, a publically traded company, is the parent company of the Arm & Hammer^® product line. Although originally used only for baking purposes, the company has leveraged the other key attributes of basic baking soda (cleaning and deodorizing benefits) into numerous applications.

The first Arm & Hammer^® detergent was introduced as early as 1970. In 1972, the product benefits expanded to use inside the refrigerator and freezer to eliminate odors. By 2005, the Arm & Hammer^® product line included laundry detergent, carpet deodorizers, Dental Care^® products, cat litter, Clear Balance^® pool maintenance tablets; and CleanShower^® for the bathroom.

In addition, line filling was accomplished through acquisitions of companies like USA Detergents, Carter-Wallace, Inc., and Orange Glo International. These acquired product lines allowed Arm & Hammer^® to expand their product line further into the personal care and household product segments.

In 1995, Church & Dwight Co., Inc. reported annual sales of $600 million. Their 2007 annual report reflects annual sales of $2.22 billion—40% of which is generated by Arm & Hammer products. Church & Dwight Company divides their product lines into three segments: consumer domestic, consumer international, and special product division (B2B). In 2007, consumer domestic (of which Arm & Hammer^® is the major player) generated 71% of total revenues. Wal-Mart, Arm & Hammer’s^® leading retailer, produced 22% of total consumer domestic revenues.

Level 1: Qualitative Questions

1.   What is the core benefit of Arm & Hammer^® products?

     

2.   Would you consider Arm & Hammer^® to have a “full-line product strategy?”

     

3.   Would you consider Arm & Hammer products to be in direct competition with those offered by Proctor & Gamble? Why?

Level 2: Quantitative Questions

1.         In dollars, how important is the Wal-Mart relationship to the Arm & Hammer^® segment of Church & Dwight’s annual sales?

           

2.         Some marketing gurus warn that line expansions can dilute the brand. Do you feel this should be a concern for Arm & Hammer?

Answer 1

1) The core benefit of Arm & Hammer products is cleansing and deodarizing ( even though it was originally used for baking purposes)

2) Yes, Arm & Hammer should have a full-line product strategy which will help utilizing the power of baking soda as a product used for cleansing and deodarizing apart from using it only for baking purposes

3) Products offered by Procter and Gamble is not entirely a competition to Arm & Hammer because most of P&G caters to the Laundry Detergent business whereas Arm & Hammer's products has other products also (like Dental Care® products, cat litter, Clear Balance® pool maintenance tablets; and CleanShower® for the bathroom)

Level 2

1) Going by the percentages of global sales alone (not revenue) in the case, in 2007, 22% of 40% of 2.22 Billion dollars is what Wal-mart has provided the Arm & Hammer which is 195 Million dollars

2) Line expansions might dliute the brand is true in some cases. If they dont do the line expansion, then other such marketing gurus will suggest that they are not exploiting the market to its full potential. There is no right or wrong answer here, but if I was the head of Arn & Hammer, then yes, i would go for line expansions to penetrate all markets and also to cater to more consumers