Clorox’s new CEO is racing to keep wipes on store shelves
The future of sanitation technology?
Dr. Ahmed Elborno joins FBN’s Jeff Flock in Vernon Hills, Illinois.
Linda Rendle was 29 years old and the junior-most manager in a meeting of Clorox Co. CLX -0.68% executives when she spoke up to say their approach to launching a line of earth-friendly cleaners wasn’t ambitious enough.
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Her bosses ultimately agreed and the company substantially broadened the Clorox Green Works product line, moving more aggressively into major categories such as home care and laundry rather than sticking to niche offerings. Within months of the brand’s 2008 launch, sales surpassed those of established green players such as Seventh Generation and Method.
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“Normally in the room, I’m the person trying to make things bigger,” said Ms. Rendle, who started this month as chief executive of the Oakland, Calif.-based maker of household staples. “You have to be absolutely unafraid of having an opinion and to advocate for that opinion.”
She ascended to Clorox’s top job this month, during an unparalleled moment for the company: After a stretch of combating flagging sales, Clorox is now facing an explosion of demand for its products. A year ago, Ms. Rendle was entirely focused on getting more customers to buy Clorox products. Now, she has an almost singular mission: ramp up production of cleaning products as the company struggles to meet pandemic-fueled demand for items such as disinfecting wipes and sprays.
Cleaning supplies remain in severely short supply as American consumers and businesses adopt rigorous disinfecting regimens to stop the spread of the new coronavirus. Ms. Rendle, who previously oversaw the company’s cleaning division, drove efforts this year to increase production of cleaners and to lay out plans to expand capacity in coming months.
Ms. Rendle, 42 years old, is among the youngest executives to lead a Fortune 500 company and one of only a few women. She is the first woman to run Clorox, even though the company has been selling mostly to women for decades.
A graduate of Harvard, where she majored in economics and played varsity volleyball, she joined the company in 2003 after a three-year stint in sales at Procter & Gamble Inc. She rose from a sales analyst for the company’s charcoal and bug-killer businesses to spearheading a companywide effort to boost flagging sales across all categories. She was central to the company’s decision in June to pull advertising from Facebook in what Clorox said was an attempt to distance itself from hate speech on the platform.
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Now focused on meeting surging demand, Clorox had a different problem heading into the public health crisis. The company was dealing with slow sales of key products including Glad trash bags and Kingsford charcoal after price increases backfired, because rivals didn’t follow suit and consumers switched to cheaper alternatives.
Sales were flat in 2019’s final quarter, well below sales gains of Procter & Gamble and Colgate-Palmolive Co. Clorox shares were up less than 6% in the year leading up to Feb. 10, when the pandemic sent markets tumbling. The S&P 500 was up 25% in that same period, while P&G shares rose 30%.
Last fall, Ms. Rendle was tasked with creating a plan to bolster sales. At the time, she was three months into her job as an executive vice president in charge of global operations and strategy and Clorox’s cleaning and international businesses. She was named president in May of this year.
Then-CEO Benno Dorer, who had led the company since 2014 and remains executive chairman, said he had been impressed by her confidence and results and had identified her as a potential successor. He wanted to test her ability to develop and execute a major corporate strategy.
She launched an initiative to create new products and innovative marketing strategies and to cut costs through technology and sustainability.
Five months after the program started, the pandemic led to an explosion in sales. By early March, as the first U.S. Covid-19 cases were being reported on the West Coast and in New York state, consumers began stocking up on cleaners. In late February, company executives said they were prepared for the surge. By mid-March, shelves were bare.
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Now Clorox faces a barrage of demand from retailers and consumers clamoring for items in short supply, from disinfecting wipes to surface sprays.
Ramping up demand has required a new spate of safety procedures as factories continued to operate throughout the spring when much of the country shut down and only essential businesses were allowed to continue operating.
Ms. Rendle said Clorox increased production of cleaners by 50% and is racing to add capacity while staving off competition from industry rivals hoping to capitalize on product shortages. At points during the spring and summer, demand for cleaners was five times regular levels. “There’s an important role we can play for people, and Clorox has an enormous opportunity to do that now,” she said.
Clorox sales in the latest quarter were up 22%, outpacing growth for household-staples rivals including P&G.
Among the steps Ms. Rendle has taken to bolster supply of cleaners: halting production of some specialty offerings, including the Green Works line she championed years earlier, in order to simplify manufacturing. Green Works, with its natural ingredients, is not among the products recommended by the U.S. government as a protection against the new coronavirus.
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While the pandemic keeps employees and their children home for the foreseeable future, Ms. Rendle said Clorox is working on ways to help workers with child care. Her husband, a part-time middle-school administrator, handles remote learning for their boys, 8 and 13 years old. Still, she said she makes a point of interacting with her sons during video calls to put other employees at ease.
Clorox marketing and strategy chief Stacey Grier, 15 years Ms. Rendle’s senior, said Ms. Rendle has been a valuable mentor. Ms. Grier took over the top marketing job in 2019. Ms. Grier joined Clorox in 2016 after spending 25 years at ad agencies, often working with Ms. Rendle.
Ms. Grier said Ms. Rendle cautioned her against trying to replicate her predecessor’s style. “She said, ‘I’m going to call you on it if you try to be someone else,’” Ms. Grier said. Ms. Rendle followed through. “After a meeting one time, she pulled me aside and said, ‘What did you really want to say in there?’”
“And she was right.”
Ms. Rendle said she recalls feeling nervous ahead of the 2007 Green Works meeting, having mentally laid out an argument for why the company should implement a widespread rollout of the brand instead of the limited, niche launch executives were planning. At the time, so-called green cleaning products were a minute part of the mainstream market.
“Before I do anything that’s hard, I say: ‘What’s the worst thing that will happen if you do this?’” she said. “And: ‘What’s the worst that will happen if you don’t?’”
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