The home and hygiene growth playbook of the past is ripe for reinvention. In 2020, home and hygiene brands grew 11 percent globally—spiking at 13 percent in the United States—spurred by the COVID-19 pandemic. Since then, the industry has relied on steady price increases to counteract volume declines, achieving about 5 percent annual growth. However, as inflation has calmed, total growth has returned to prepandemic levels—about 2 to 3 percent annually.1
In this meaningfully different environment, what will it take for home and hygiene players to grow (see sidebar, “Defining home and hygiene”)? A survey of retailers, interviews with industry leaders, and our own research into consumer spending trends suggest that eight forces will shape growth strategies in the sector. Below, we analyze each and offer a perspective on how players should adapt in response.
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Next steps for pursuing growth in home and hygiene
What do all these forces mean for home and hygiene players that now have a new imperative for growth? A handful of moves belong at the top of the to-do list:
- Disaggregate your historical and projected performance. Identify which categories, subcategories, brands, and channels are growing fastest from a unit perspective—and where your brands have a right to win but might be underperforming potential.
- Get granular on your understanding of your consumer. Uncover who they are, why they buy your brands, how behaviors are changing—particularly in regard to need states—and where new growth opportunities are. Study the evolving shifts and blended need states in categories such as hand soaps, then determine what can apply to your categories.
- Map out channel shifts. Pinpoint where your key categories and brands are positioned to succeed as commerce evolves, and map out a stronger channel mix. Ensure you are delivering on the unique needs of each of the largest retail channels, and have a clear strategy for agentic AI commerce.
- Rev up your innovation engine, and prove your value. Consumers are ready to trade up, but they’re just as ready to trade down when a product doesn’t deliver. Ensure your teams and resources can deliver breakthrough ideas that defend your edge against competitors and resonate deeply with consumers. Look for areas that are most vulnerable to private brands, and determine if your brands can out-innovate to provide unique benefits.
- Gear to win agentic commerce. Ensure that your marketing engine is geared for a world with increased AI-driven commerce and that the value your products provide to consumers can be easily identified by AI agents so you receive credit by way of increased buying recommendations.
- Revisit your financial aspiration, and raise the bar. Underwrite your growth plan with a rigorous fact base that’s grounded in brand, category, and channel priorities.
Growth is eminently possible in the coming years for the home and hygiene sector. By innovating now, brands can secure their place on retailers’ shelves and in consumers’ minds.
