5. Baby care
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july30/31 2016<br />
Jancis Robinson on how<br />
to taste wine on holiday<br />
‘I taught myself to clean up<br />
Mexico’s crime scenes’<br />
An intellectual world without<br />
barriers, by Giles Wilkes<br />
The<br />
bathtime<br />
battle<br />
Johnson & Johnson<br />
is struggling to win<br />
over millennial parents.<br />
David Crow reports<br />
on the rise of<br />
‘natural’ baby<strong>care</strong>
Chemical<br />
vsv<br />
natural<br />
The consumer giant Johnson & Johnson has<br />
dominated the baby<strong>care</strong> market for more than a<br />
century. But as millennial parents embrace organic,<br />
natural ingredients, the company faces fresh<br />
challenges. David Crow reports<br />
Still life Sam Armstrong Portraits Jessica Barthel
henAlexis andGabe Landes foundout they were<br />
expectingtheir first child, they beganpreparing<br />
their apartment onthe Upper West Side of<br />
Manhattan for thebig arrival. Thenesting instinct<br />
soon took theLandes couple beyondthe nursery<br />
andintothe bathroom, where they disposed of all<br />
themass-produced toiletries they owned.<br />
“Once my wife became pregnant, we thoughta<br />
lot about whatwas going intoher,and intothe kid<br />
in utero, soweshifted all the high-volume,<br />
corporate stuff out of our home,” says 37-year-old<br />
Gabe, whoworks as aconstruction manager for a<br />
solar-powercompany. “It was already bakedinto<br />
our values. Even before Alexis gotpregnant,we<br />
would eatadietlow in meat andbuy our foodfrom<br />
small, local farms.”<br />
Isaacarrived 15 months ago, “adorable, andaton<br />
of fun”, andhis parents were showered –asmany<br />
parents are, in hospital or viamailing lists –with<br />
free samples of babyproducts made by Johnson &<br />
Johnson, the world’s largest manufacturer of<br />
toiletries for infants. But they avoided the<br />
supermarket shelves stackedwith J&J’sbottles and<br />
started searchingfor alternativesthatcontained<br />
fewer chemicals andmore natural ingredients.<br />
“Wewanted to makethe best decisions about<br />
everything we were puttingonhis skin, fromshampoo<br />
to sunscreen,”saysGabe.They settled on ababy<br />
soap made by Dr Bronner’s, oneofthe early pioneers<br />
of natural toiletries.Ratherthan using Johnson’s<br />
baby creams or talcum powders for Isaac’s nappy<br />
rash, they opted for pure coconut oil.<br />
TheLandes family is notalone. An increasing<br />
number of parents in richer countries are eschewing<br />
J&J’s products in favour of premium or natural<br />
alternatives. Thetrendhas resulted in amarked<br />
slowdowninsales of J&J’s babyproducts.After more<br />
than acentury as theleading purveyorofinfant<br />
shampoos, creams, talcum powders andlotions, the<br />
companyislosing share to newerrivals. In thefirst<br />
six months of the year, USsales of its baby<strong>care</strong><br />
products slumped to $197m, thefirst timetheyhave<br />
fallen belowthe $200mmark since 2007.<br />
Speaking to journalists in April this year,<br />
Dominic Caruso, J&J’s chief financial officer,<br />
attributed thedeclinetoparents buying “premium,<br />
natural-type brands”,and promised shareholders<br />
thatthe companywould relaunch its range to better<br />
cater totheir tastes. But J&J faces asignificant<br />
challenge in winning overyounger parents, many<br />
of whom mistrust thebig commercialbrands so<br />
belovedbytheir ownparents andgrandparents.<br />
The Landes and their friends are part ofa<br />
generation that tends to be more suspicious of<br />
mass-produced food and cosmetics, and ofbig<br />
business in general. Many scour food labels for<br />
artificial ingredients, andbelievethatsmaller is<br />
better, and organic better still. Their healthconscious<br />
attitude is creating problems notjust for<br />
J&J but for manyother brands too, from McDonald’s<br />
to Kraft –names that were once astaple of<br />
American family life.<br />
J&J’s forayintothe baby<strong>care</strong> business was<br />
unplanned. Founded 130 years agoby<br />
three brothers in New Jersey, the<br />
company was set up to capitalise on<br />
the theories ofSir Joseph Lister, the<br />
British father of antisepticsurgery.In<br />
1867, Sir Joseph had published aseries of case<br />
studies showing thatsterile surgical procedures<br />
would save countless lives. His work was initially<br />
dismissedbysurgeons, manyofwhomrefusedeven<br />
to wash their hands beforeoperating, but he found<br />
aconvert in RobertWood Johnson, theeldest of<br />
the three brothers, atrained apothecary. After<br />
attending one of Sir Joseph’s lectures at a<br />
Philadelphia medical conference in 1876,Robert<br />
joinedhis siblings in business and, in 1886, they<br />
startedmanufacturing stitches anddressings that<br />
were sterile and affordable, helping to bring<br />
survivable surgerytothe masses.<br />
The company quickly branched out, in 1888<br />
pioneering thecommercialfirst-aid kit to combat<br />
a spike in accidents in the increasingly<br />
industrialised workplace. It also foundsuccess with<br />
its medicatedplaster,anadhesivepatch of rubber<br />
thatpromised to deliver an infusion directly to the<br />
skin to soothepain. Customers liked theproduct<br />
but soon started complaining that the sticky<br />
squares were irritating their skin. J&J responded<br />
by shipping theproduct with atinycontainer of<br />
talcumpowder to sootheirritation, prompting a<br />
raft of letters frompeoplewho foundthe powder<br />
also relieved nappyrash andother skin complaints.<br />
And sothe Johnsons launched “Toilet and<br />
<strong>Baby</strong> Powder” in1894, the first in aseries of<br />
products thatwould dominate thebaby<strong>care</strong> market<br />
for more thanacentury.Itcameinatin with an<br />
orange-and-white label, carrying alogo that<br />
has never changed: the family name inastyle<br />
mimicking the handwriting ofJames Wood<br />
Johnson, theyoungest of thebrothers.<br />
J&J went on to build abusiness that came to<br />
occupy aspecial place in the consciousness of<br />
mothers, its products closely tracking changes in<br />
maternal health. Around the time ofthe <strong>Baby</strong><br />
Powder launch, J&J began selling maternity kits<br />
designed to improve thesafety of home births, then<br />
themost common wayofdelivering achild.<br />
“It was everything in abox thatthe doctoror<br />
midwifewouldneed to ensureasafedelivery for<br />
mother andbaby,”explains Margaret Gurowitz, a<br />
softly spoken lifelong employeeatJ&J whoisnow<br />
thecompanyhistorian. “Sterile drapes, sheeting<br />
and sutures –and antibacterial soap with a<br />
sam armstrong/black dog represents; daisy ellen floral design<br />
‘Once my wife became<br />
pregnant…weshifted<br />
all thehigh-volume,<br />
corporate stuff out<br />
of ourhome’<br />
Gabe Landes, New York, shown above<br />
with his 15-month-old son Isaac<br />
nailbrush, so that the birth attendants could<br />
wash their hands.”The kits were packagedwith<br />
small booklets containing tips and advice for<br />
youngparents.<br />
As childbirth movedintothe hospital setting,<br />
rendering home maternity kits increasingly redundant,<br />
J&J startedtodevelop arangeofproducts to<br />
<strong>care</strong>for babies at home –anappy-rash creaminthe<br />
1910s, asoap in the1920s andamoisturisingoil and<br />
lotion in the1930s and1940s. Then, in 1954, it<br />
startedselling its famous babyshampoo, which<br />
promised there would be “No More Tears”.<br />
Oneofthe first newspaper advertisements for<br />
theproductshowedababygirl positively beaming<br />
as shehad herhair washed– afar cryfrom thetears<br />
andtangles thathad hitherto dominatedbathtime.<br />
“Won’t burn or irritate theeyes,”itpromised. “Pure.<br />
Gentle. Safe.”The product, then 59 cents abottle,<br />
was anear-instant hit andwould go on to become<br />
synonymous with bathtimefor millions of children<br />
across thegenerations.<br />
“I grew up with abathroom fullofthe stuff,”<br />
recalls CatherineEverett, the32-year-old mother<br />
of twoyoung girls, three-year-old Lyra andeightmonth-old<br />
Nina, who lives in Bridge ofAllan, a<br />
small townincentral Scotland. “I vividly remember<br />
my parents washing my hair with J&J babyshampoo,<br />
before beingshowered head to toeinJ&J baby<br />
talc. The smell still conjures up memories of<br />
Sunday-night bathtime.” She still washes her<br />
daughters’ hairwith it because, “I know it won’t<br />
sting their eyes, as Iused it for years myself.” ▶<br />
14 ft.com/magazine july 30/31 2016<br />
ft.com/magazine july 30/31 2016<br />
15
Top From left, brothers James Wood Johnson,<br />
Edward Mead Johnson and Robert Wood Johnson,<br />
who founded the company in1886 Above The<br />
company’s first factory, in New Brunswick, New<br />
Jersey Below J&J advertisements for surgical<br />
dressings (1950) and baby shampoo (1954)<br />
◀ Even after thebirth rate startedtodeclineinthe<br />
1960s in thewakeofthe postwar babyboom, sales<br />
of J&J’s infant shampoo continued to rise.The companyhad<br />
startedmarketing theproducttoadults,<br />
arguing thatifwas mild enough for babies,thenit<br />
would be gentle on their hair,too. In thelate1960s,<br />
it enlistedadvertising agency Sullivan, Stauffer,<br />
Caldwell &Bayles to record aseries of radio adverts<br />
aimedatone of the last groups of holdouts: teenage<br />
boys whohad ditched thecrew-cut hairstyles of<br />
their fathers’ generation for themop-tops of the<br />
Beatles. It worked: by 1975, the shampoo outsold<br />
all other adult andbabybrands in theUS.<br />
Thesuccess of its babyrangeisthe foundation<br />
on which J&J built oneofthe world’s biggest consumer<br />
products businesses, with arange including<br />
sanitarytowels, toothbrushes andover-the-counter<br />
painkillers. By 1970, thecompany’shygieneand<br />
baby<strong>care</strong> lines were generating more than $280m<br />
in annual sales.Adecade later, revenues had swelled<br />
to $1.8bn,making it themostlucrativepartofJ&J’s<br />
business. In 2010 they hit apeak of $10bn.<br />
For the past six years, however, J&J’s<br />
consumer business has been struggling,<br />
in part because of lacklustre<br />
sales of thebabyrange. Thecompany<br />
sold roughly $2bn of baby<strong>care</strong> products<br />
last year,about 10 per cent less than in<br />
2010. In April, it announcedthatitwould relaunch<br />
therangeafter US sales in thefirst three months<br />
of 2016 fell to $95m,their lowest in more than a<br />
decade. Caruso said thecompanywas losing out in<br />
the battle for “millennial mums”,who have been<br />
switching to organic, natural products.<br />
CatherineEverettisone such parent.While she<br />
uses thecompany’sshampoo, sheactively avoids<br />
its other products. “These days we are advised by<br />
health visitors not toput too much product on<br />
[babies’]skin, as itissosensitive,”she says.“If I<br />
use anything, Ilook for products with fewer chemicals<br />
than J&J.” In an agewhenhealth<strong>care</strong>brands<br />
are tripping over themselves to market their products<br />
as natural or organic, sheinterprets thelack<br />
of anysuch claim on theJohnson’s bottles as asign<br />
of “how potent thestuff mustbe”.<br />
In Washington DC,Robyn Pashby doesnot buy<br />
J&J products for her16-month-old daughter Alexa,<br />
preferring instead to use independently made products<br />
from local farmers’markets near herhome.<br />
“For manyyearswe’d been shopping at our local<br />
farmers’ market for ourfood anyway, andIstarted<br />
to realise thatifwe’re going to be so <strong>care</strong>ful about<br />
whatgoes in herbody, then we should be <strong>care</strong>ful<br />
about whatgoes on it too,”saysthe 39-year-old<br />
Pashby,who adds thatshe is keenly aware thatnot<br />
all parents can afford to makethe samechoice.<br />
Pashbyisparticularly put off by thefragrances<br />
used inJ&J’s ranges –“The scents just smell so<br />
fake” –and thelong list of ingredients. “I became<br />
disillusioned by products madewith things Ican’t<br />
pronounce.I’m meant to put thatonmybaby’s<br />
skin?Whenit’s so fragile?” It is notjustthatPashby<br />
is picking alternatives to J&J but thatshe is using<br />
fewer products altogether. “I don’t really use<br />
powders or lotions. Imight use coconut oil andbuy<br />
an all-in-onenatural soap,”she says,citingTom’sof<br />
Maine (owned by Colgate-Palmolive), which lists<br />
itsingredients on its websiteand alsotheir source.<br />
Pashby says she took her cue from medical<br />
experts. “WhenAlexa was in theneonatalintensive<br />
<strong>care</strong> unit at thehospital after shewas born, they<br />
Read the label: Johnson’s baby<br />
shampoo vs the independent<br />
organic brand California <strong>Baby</strong><br />
Johnson’s <strong>Baby</strong> Shampoo Ingredients: water (eau),<br />
cocamidopropyl betaine, PEG-80 sorbitan laurate,<br />
sodium trideceth sulfate, PEG-150 distearate,<br />
phenoxyethanol, sodium chloride, glycerin,<br />
citric acid, sodium benzoate, tetrasodium EDTA,<br />
polyquaternium-10, ethylhexylglycerin, sodium<br />
hydroxide, potassium acrylates copolymer, Yellow 6,<br />
Yellow 10, parfum<br />
California <strong>Baby</strong>Shampoo &Bodywash Ingredients:<br />
water, decyl glucoside*, lauryl glucoside*, quillaja<br />
saponaria extract (soap bark), vegetable glycerine<br />
USP*, calendula oicinalis flower extract (calendula),<br />
viola tricolor extract (pansy), yucca schidigera extract<br />
(yucca), aloe barbadensis leaf juice (aloe vera),<br />
simmondsia chinensis oil (jojoba oil), hydrolyzed<br />
quinoa protein, xanthan gum USP, panthenol (vit B5),<br />
pure essential oils of lavandula angustifolia (French<br />
lavender) and salvia sclarea (clary sage), phytic acid<br />
(rice origin), gluconolactone** (and) sodium benzoate;<br />
*=sustainable palm fruit kernel and/or coconut;<br />
** =sourced from corn (non-GMO)<br />
just used cotton wipes with water, andthatworked<br />
fine. Thehospital using only waterwas abig eyeopener<br />
for me.Mypaediatriciansaid unless shehad<br />
irritable skin Ishould notover-batheher.”<br />
J&J contends thathealth<strong>care</strong> professionals recommendits<br />
babyproducts more than anyother<br />
brand.Thecompanysaysitdoes more research into<br />
infant skin than anyother companyand thatits<br />
mild products help to prevent moisture loss.<br />
Dr Jon Hanifin, aprofessor of dermatology at<br />
Oregon Health andScience University,pointsout<br />
thatthe companydistributes many free samples<br />
through hospitals.“Whathappens istheydump<br />
tons of it on to nurses, whogiveitto patients, and<br />
then the parents go home and use it,” hesays.<br />
“Putting all kinds of fragrancesonthe skin can lead<br />
to irritation,and J&J has alot of fragrance in their<br />
products, which doesn’t help.”<br />
His advice to young parents is to bathe their<br />
babies no more than three times aweek andthen<br />
to trytolock moisture intotheir fragile skin with<br />
afragrance-free lotion such as Cetaphil andCeraVe.<br />
Such recommendations, however, mightnot satisfy<br />
those whosee their avoidance of J&J as arejection<br />
of big business. Cetaphil is made by Nestlé, the<br />
Swiss food giant thathas been plagued by controversy<br />
for years for promoting its infant formula as<br />
an alternativetobreast milk. CeraVeisowned by<br />
Valeant, aCanadian drugmaker thathas been in<br />
theheadlines for thepast year for sharply raising<br />
thepriceofits drugs.<br />
Infact, manyofthe best-knownpremium<br />
baby<strong>care</strong> brands are controlled by largemultinational<br />
companies,despitetheir homey<br />
packaging andcutenames.Aveenoisthe<br />
largest, with a1<strong>5.</strong>5 per cent share of theUS<br />
babyand infant skin<strong>care</strong> market, according<br />
to Euromonitor.Createdin1945, thebrand(whose<br />
mission statement declares, “Webelieve nature<br />
has thepower to makelife beautiful”)was bought<br />
by J&J in 1999, helping to hedgeagainst stalling<br />
sales of J&J’S own-brandproduct. Another leading<br />
premium brand, Burt’s Bees,ismade by Clorox,<br />
best known for household cleaning products<br />
includingbleach (thecompanynameisaportmanteau<br />
of chlorineand sodium hydroxide).<br />
The biggest independent manufacturer of<br />
natural baby<strong>care</strong> products in theUSisCalifornia<br />
<strong>Baby</strong>,founded by Jessica Iclisoytwo decadesago.<br />
“Wepositionourselvesasfor mums who want a<br />
natural focus, with no sulfatesorparabens,”she<br />
says, referring totwo of the ingredients most<br />
johnson &johnson<br />
disliked by health-conscious consumers. Sulfates,<br />
containedinmanyshampoos andoften listed on<br />
thelabel as sodium laureth sulfate,are chemical<br />
detergents thathavebeen linked to skin irritation,<br />
while parabens –which some believe affect<br />
hormone levels –are used to suppress bacterial<br />
growth in cosmetics.<br />
The products are not cheap. A19oz (roughly<br />
500ml) bottle of California <strong>Baby</strong>’s“super-sensitiveshampoo”costs<br />
around$24 on Amazon,whereas<br />
aslightly larger bottle of Johnson’s No More Tears<br />
formula is two-thirds cheaper at about $8.<br />
California <strong>Baby</strong>isaprivate companyand does<br />
notpublish its revenue figures, but Iclisoysaysan<br />
increasing number of parents are making the<br />
switch despitethe higher prices. “Today, more than<br />
ever,consumers are becoming more educated, and<br />
we are seeing amajor changeover. Originally,the<br />
demandwas from nicheconsumers interested in<br />
health andwellbeing but nowwe’re seeing customers<br />
switching over in Walmart.”<br />
Iclisoy’s main competition is not necessarily<br />
the big corporations but rather the ranks of<br />
independent players who make their wares in<br />
small batches and sell them online and at local<br />
farmers’ markets. More thanthree-quarters of the<br />
$300m US market for premium baby<strong>care</strong> brands<br />
is controlled by companies with amarket share of<br />
less than2.5 per cent,accordingtoEuromonitor;<br />
manyofthemare “mom andpop”outfits thatrun<br />
their operations out of aspare bedroom.<br />
Patricia Butter started dabbling in baby<strong>care</strong><br />
products sevenyearsago,after herseconddaughter<br />
Evelyn developed eczema, an ailment that had<br />
plagued thefamilyfor generations. Shefound that<br />
thetoiletries shewas buying in thesupermarket<br />
only exacerbated her daughter’s condition.<br />
“Everything Iboughtatthe store actually made it<br />
worse,”she says.Aroundthe sametime, shehad<br />
started growing calendula flowers on asmall<br />
vegetable patchinthe back garden of herholiday<br />
cottage inthe Catskills mountains. She soon<br />
noticed thather ownchapped,irritatedhands were<br />
much improvedafter picking theblooms.<br />
“I was able to work out howtoextractthe flower<br />
intoanoil andithelpedimmensely,and then Itried<br />
to blenditwith butter so it could be turned intoa<br />
balm,”Butterrecalls. “Evelynwas athumb-sucker,<br />
andIwas concerned about things ending up in her<br />
mouth, so Iworked only with things youcan eat.”<br />
Butter now sells three products through her<br />
Buttercup Naturals brand: acalendula oil for<br />
eczema, abalmand askin cream. Sherunsthe companyfrom<br />
herhomeinPleasantville in upstate New<br />
York, and sources her flowers from afriend,<br />
ShannonAlgiere,who grows them on anearbycommunalfarm,<br />
StoneBarns. Shesells through Etsy,<br />
thedigital marketplace, andthe farm’sgift shop.<br />
Thebusiness could be bigger,she says,but she<br />
has chosen to keep thingssmalltobalance work<br />
with family life. Shebelieves, though, thatdemand<br />
for thesortofproductsshe sells will only increase<br />
in thecoming years.“It’s partofabiggershift away<br />
from thechemical age, thepostwar excitement<br />
about using artificial foreverything. Nowpeople<br />
are going back and looking at these ingredients<br />
more <strong>care</strong>fully,” shesays.<br />
In Butter’s view, J&J’s baby<strong>care</strong> business will<br />
have to adaptifitistosurvive.“As consumers shift<br />
to organic, Ican see J&J having to change the<br />
formula to address parents’ concerns.Theywill be<br />
under constant pressure to do that.”<br />
‘I became disillusioned<br />
by products made with<br />
thingsIcan’t pronounce.<br />
I’m meant to put that<br />
on my baby’s skin?’<br />
RobynPashby, Washington DC, shown above<br />
with her 16-month-old daughter Alexa<br />
Inanother era, thedeclineofJohnson’s baby<br />
businessmight have posed an existential<br />
threattothe entire company. But J&J,the<br />
world’s largest health<strong>care</strong> group with a<br />
market value of $336bn, is averydifferent<br />
business from theone thatwas founded all<br />
those years ago. The group now makes the vast<br />
majority of its revenues andprofits from selling<br />
prescription drugs and medical devices such as<br />
replacement hips.<br />
Just oneofthe company’sdrugs,for example,<br />
thearthritis injection Remicade, generated$3.6bn<br />
in salesinthe first six months of this year –versus<br />
sales of $950m for all its babyproducts combined.<br />
Revenues from allofJ&J’s prescription drugswere<br />
$16.8bn compared to $6.6bn for the entire ▶<br />
16 ft.com/magazine july 30/31 2016<br />
ft.com/magazine july 30/31 2016<br />
17
◀ consumer business, which includes notjust baby<br />
products but well-knownbrands such as Listerine<br />
andNeutrogenatoo. These days,financial analysts<br />
whomonitor thecompanyfor investors spendlittle<br />
timetracking baby<strong>care</strong> sales andrarely mention<br />
thedivision in their reports.<br />
Yetthe numbers belie thereal importance of<br />
baby<strong>care</strong> to J&J.The late James Burke, chief executive<br />
of J&J between 1976 and1989, once said that<br />
theproducts had built a“reservoir of trust” in the<br />
company. “There is no greatertrust than between<br />
mother andchild. Sothere’s an element of trust<br />
built intoeverybody’s attitude towards J&J that’s<br />
notbuilt into manyother companies.”<br />
The same istrue today, according to Alison<br />
Lewis, the chief marketing officer for J&J’s<br />
consumer business. “It’s thefirst entrypoint of J&J<br />
into aperson’s life, because we’re talking about<br />
children and young mothers, and that’s the<br />
beginning of theJ&J relationship,”she says.<br />
Lewis is oneofthe executives tasked with reviving<br />
sales of thecompany’sbabyproducts. “It’s fair<br />
to saythatour Johnson’s babybusinessoverthe<br />
last few years has notbeen where we want it to be<br />
in performance,” shesays, adding thatthere have<br />
been 25 newcompetitors in thepremium partof<br />
themarketsince 200<strong>5.</strong> “We’re stilllearning as a<br />
bigiconicbrandhow to connectwithmillennial<br />
Ababy-powder<br />
lawsuit<br />
The reputation of J&J’sbabyproducts<br />
wasdealt asignificant blowinFebruary<br />
2016,when ajuryinMissourirequired<br />
the companytopay $72mtothe family<br />
of Jacqueline Fox, whose ovarian<br />
cancer had been linked to her lifelong<br />
use of the company’s<strong>Baby</strong>Powder.<br />
Lawyers forFox –who died aged 62,<br />
four months beforethe verdict –said<br />
J&Jhad neglected to inform customers<br />
that itstalc-based productscould cause<br />
cancer.Her case is one of roughly 1,000<br />
lodged in Missouri, while afurther<br />
200havebeen filed in NewJersey.<br />
Beforeshe died, Foxtold her lawyers<br />
she applied the powder to her genital<br />
area regularly,something that is not<br />
recommended by J&J,which warns on the<br />
label that it is forexternal use only.Her<br />
lawyers argued that the group should have<br />
gone further inmaking consumers aware<br />
of the risks,which have been highlighted<br />
in morethan 20 scientific studies. J&J<br />
arguesthat the studiesare basedon<br />
unreliable data, and pointstoother<br />
research that has found no direct link.<br />
The companyhas said it will appeal<br />
the verdict but, even if it wins, it will be<br />
hardtoundo the reputational damage.<br />
All the parentsinterviewedfor this<br />
piece had seen coverage of the trial,<br />
and cited it as one of the main reasons<br />
theywouldavoid Johnson’s products.<br />
“Therehavebeen concerns raised by<br />
mothers –ifyou go on social [media]<br />
feeds, you’ll see that,”saysJ&J’s Alison<br />
Lewis. “What we’redoing is providing the<br />
factsthat areconsistent with the safety<br />
of this product and the standards that we<br />
have had in place forover100 years.”<br />
‘You should expect a<br />
completereinvention<br />
of everyproduct line’<br />
JorgeMesquita, Johnson &Johnson<br />
mums whohavedifferent demands,”she says.“We<br />
need to makesure we are addressing their concerns<br />
aroundnatural andorganic.”<br />
Yet Lewis, who recently returned from a<br />
research trip to thetownships of South Africa, also<br />
stressesthatthe switch to premium productsisfar<br />
less pronouncedindeveloping countries. “There<br />
are 135 million babies born everyyear,and 75 per<br />
cent of those are in emerging markets, so to say<br />
thatall millennial mums can afford aproductlike<br />
California <strong>Baby</strong>isaproblem,”she says.<br />
ManyofJohnson’s recent productlaunches have<br />
beenaimed at parentsinpoorer countries, such as<br />
an extra-largebabywipe intended to takethe place<br />
of abath when there is no access to clean water.<br />
Far from acheap product, Johnson’s is regarded by<br />
manyfamilies in emergingmarkets as apremium<br />
western brand that is worthpaying more forthan<br />
domestic alternatives, accordingtoLewis.<br />
Even so, J&J’s babyproducts are notdoing particularlywell<br />
outside theUS. International revenues<br />
in thefirst six months of theyear were $754m<br />
–about $200m lowerthan fiveyears agoand their<br />
lowest since 2007.<br />
In the US, the company has launched anew<br />
marketing campaign intended toappeal to<br />
millennials, with oneTVadvertfeaturing twogay<br />
fathers –anod to therapidly changingimageofthe<br />
American family. But Lewis is aware that the<br />
companyneeds to do more to repair its reputation<br />
onTwitter andFacebook, where manyparents swap<br />
s<strong>care</strong> stories about Johnson’s products.<br />
“That’s the way insocial media –boom,<br />
andthe flick of afew fingers –and it’s notalways<br />
themost educatedpoint of view.It’safeeling, and<br />
it’s alegitimate feeling, but let’s put thefacts out<br />
there andthenlet people decide,”she says.“There’s<br />
alot of internet hyperbole out there, alot of myths,<br />
and alot of ‘mom and pops’ creating stuff in<br />
their bathtub.”<br />
Josh Ghaim, chief technology officer in<br />
J&J’s consumer division, adds thatthe companyis<br />
pushing regulators to implementstricterrules on<br />
howbabyproducts are labelled, which he believes<br />
could help the Johnson’s brand while hurting<br />
its competitors.<br />
“We believe there should be standards,<br />
especially when it comestobabies,”hesays. “It’s<br />
interesting when youhear people say, ‘Wedon’t<br />
use fragrances, we use essential oil.’ Nobody<br />
realises thatessentialoil actually has 40 different<br />
ingredientsinit. Nobody knowswhattheyare, or<br />
whether they are safe.”<br />
Theterm “natural”isill-defined. TheUSdepartment<br />
of agriculture stipulates that companies<br />
whoclaim their products are “made with organic<br />
ingredients”must be at least 70 per cent organic,<br />
but there is no equivalent rule for the term<br />
“natural”. Indeed, the vast majority of baby<strong>care</strong><br />
products thatclaim to be “natural”use an artificial<br />
preservative, such assodium benzoate, to stop<br />
bacterial growth.<br />
Ghaim says thatmorethan 80 per cent of the<br />
ingredientsinJohnson’sproducts are “naturally<br />
sourced”,but concedes thatthe wayinwhich they<br />
are processed ofteninvolves artificial chemicals.<br />
One option under consideration is being more<br />
transparent about whatisinthe company’svarious<br />
lotions andshampoos.<br />
“That’s abig area of focus for us. We believe<br />
that every ingredient that’s in the product<br />
should actuallybeonthe label or on our website,<br />
so youcan choose.”<br />
Going much further than thatcould prove difficultfor<br />
acompanyaslargeand complex as J&J.<br />
Whenthegroup committed in 2012 to removing<br />
twochemicals thathavebeen linked to cancerin<br />
animal studies, formaldehyde and 1,4-dioxane,<br />
from more than100 baby<strong>care</strong>products, theprocess<br />
took the best partoftwo years.<br />
“It’s not justabout bettermarketing. If it’s done<br />
correctly, itmeans atotallydifferent formulation.<br />
Thattakes time. Even asmall changetoaformula<br />
can takeyears,”saysIclisoy.<br />
JorgeMesquita, whowas hired from Procter&<br />
Gamble in 2014tolead J&J’s consumer business,<br />
says thecompanyisplanning amajor overhaul of<br />
Patricia Butter,founder<br />
of Buttercup Naturals, at<br />
Stone Barns Center for<br />
Food andAgriculture,<br />
upstate NewYork<br />
thebaby<strong>care</strong> business but he is tight-lipped about<br />
thetiming anddetails because he doesn’t want to<br />
tip off the competition. “You should expect a<br />
completereinvention of everyproductlineand<br />
every element,”hesays. “It’s going to be atotal<br />
reset of our business.”<br />
Mesquita believes there is everything to playfor<br />
–people are becoming parents all the time<br />
andJ&J is still,hepoints out, thegloballeader in<br />
infant skin<strong>care</strong>, with far-reaching consumer<br />
research operations andmassivemarketingbudgets.<br />
J&J’s plan, he says,“is to transform thebusiness we<br />
have today”. The company’s ownership of<br />
Aveenogives it astakeinthe natural market, and<br />
it recently acquiredVogue, an adult natural hair<strong>care</strong><br />
company, for $3.3bn.<br />
“Oneofthe thingswecan learn fromthemis<br />
about the sourcing of products created around<br />
natural ingredients,”saysMesquita.<br />
But from thesoundofit, J&J is notplanning on<br />
turning its babyproducts intoanall-naturalrange.<br />
“That’s very important for asubset of our overall<br />
consumer group,”saysMesquita, “but we are going<br />
to address theneeds of all our consumers.” 6<br />
David Crow is an FT correspondent in New York<br />
18 ft.com/magazine july 30/31 2016<br />
ft.com/magazine july 30/31 2016<br />
19