Just how big is the Pampers crisis?
P&G recently introduced Pampers Dry Max, replacing Pampers Cruisers and Swaddlers. The Dry Max product features an extra absorbent liner which makes the diapers thinner and improves overall performance. The Dry Max product is also cheaper to manufacturer than the old product, so P&G builds profits without taking a price increase.
The Wall Street Journal wrote about the story today:
The launch hasn’t gone well. While P&G claims that sales are fine, consumers are in a bit of an uproar, with people complaining loudly. Media outlets are starting to pick up the story. Some stock market analysts claim the Pampers story sparked last week’s big moves.
In theory, P&G should be fine. Pampers is a strong brand and the new Pampers is supposedly a better product. According to P&G there is no evidence that the new Pampers causes rashes or other problems.
The problem is that the Dry Max story is taking on a life of its own. People are noticing the product difference and asking tough questions. Consumers are looking for rashes when they use the Dry Max product. Kids get rashes, of course. This means that consumers looking for rashes will see them. And the momentum behind the story could build, whether there is a real problem or not.
P&G has some unpleasant options. The company could simply stick with the new product, repeating again and again that there is not a problem. This might or might not work. The company could bring back the old product. This is probably a very unappealing option; one does not change a paper mill without enormous capital investment. It is hard to see a happy outcome for P&G if consumer concerns build.
There is a lesson in this, and it is the same one Coke learned many years ago. Be very, very careful when changing an iconic brand. It is easy to add new products but changing the core items is always risky.