Sales: $7.7 billion
Note: $7.7 billion for personal care products. Corporate sales: $42.1 billion
Key personnel: Alex Gorsky, chairman and chief executive officer; Joseph J. Wolk, executive vice president, chief financial officer; Thibaut Mongon, executive vice president, worldwide chairman, consumer health
Major products: Baby: Johnson’s. Beauty: Aveeno, Clean & Clear, Dabao, Johnson’s, Le Petite Marseillais, Lubriderm, Neutrogena, OGX, Sundown. Oral care: Listerine
New products: Oral care: Listerine Ready Tabs. Skin care: Neutrogena Bright Boost, relaunched Neutrogena Skin360 app. Beauty: Dr.CI:Labo (acquisition)
Comments: In the end, talc just wasn’t worth saving. Facing thousands of lawsuits charging its talc-based baby powder caused cancer, Johnson & Johnson announced in May that it was discontinuing North American sales of its talc-based baby powder. Baby powder made with cornstarch remains on-shelf, of course, and the company will continue to sell talc-based powder in other parts of the world.
According to J&J, as part of a portfolio assessment related to COVID-19, in March, the consumer health business stopped shipping hundreds of items in the US and Canada to prioritize high-demand products and to allow for appropriate social distancing in manufacturing and distribution facilities during this unprecedented pandemic. Following this action, the company decided to permanently discontinue approximately 100 SKUs from the March assessment, as well as talc-based Johnson’s Baby Powder. This discontinuation is only effective in the US and Canada. Johnson’s Baby Powder represents approximately 0.5% of the total US consumer health business. Demand for talc-based Johnson’s Baby Powder in North America has been declining due in large part to changes in consumer habits and fueled by misinformation around the safety of the product, according to the company.
Despite the move, J&J maintains it remains confident in the safety of talc-based Johnson’s Baby Powder and will continue to vigorously defend the product, “its safety, and the unfounded allegations against it and the company in the courtroom,” the company said in a statement. “All verdicts against the company that have been through the appeals process have been overturned.”
Production of talc-based Johnson’s Baby Powder in the US and Canada is winding down and existing inventory will continue to be sold through retailers until it runs out. Cornstarch-based Johnson’s Baby Powder will remain available in North America. Both types of Johnson’s Baby Powder, will continue to be sold in other markets around the world where there is significantly higher consumer demand for the product. Importantly, Johnson & Johnson said it remains fully committed to its Johnson’s Baby brand.
For the first quarter of 2020, corporate sales rose 3.3% to nearly $20.7 billion. Skin care sales rose 2.5% to $1.1 billion, but while US sales jumped 12.1%, international sales fell 8.8%. Skin care sales were driven by Neutrogena and Aveeno sales, and partially offset by COVID-19 related impacts in the Asia-Pacific region.
Oral care sales rose 7.6% thanks to increased sales of Listerine products. Baby care sales fell 8.2%, due to declines in Asia Pacific and Europe, partially offset by a sales increase in Aveeno Baby.
The results follow on the heels of a mediocre 2020, when corporate sales increased just 0.3%. However, beauty care sales rose 4.8%. Growth was primarily driven by incremental sales from the acquisition of Ci:z Holdings Co., Ltd., (Dr.CI:Labo) in Japan as well as increased sales of Neutrogena and Aveeno products, partially offset by the divestitures of RoC and Nizoral in fiscal 2020.
On the downside, baby care sales fell 9.9% due to competitive pressure on the Johnson’s brand. Oral care sales fell, too, declining 1.7% as growth of Listerine mouthwash and Ready!Tabs outside the US, was offset by share declines and retailer destocking in the US.
J&J’s Neutrogena brand unveiled a revamped Neutrogena Skin360 app which doesn’t need a separate skin scanning tool. It features Neutrogena AI Assistant (NAIA), which builds a relationship with users by initiating a text conversation to determine their skin care personality, approach to skin care and their current routine.
• When designing a new skin care line for Millennials, Neutrogena enlisted those who know that skin type well: four staff scientists who are Millennials. The team—Anna Rose, Carine Hardy, Anna Trondoli and Diyana Sudarsono—paired their firsthand personal skin care experiences with their scientific expertise to develop a four-part collection for brighter skin known as Neutrogena Bright Boost.