The chief executive of Reckitt Benckiser has said he expects that Covid-19 will permanently increase sales of Dettol and other cleaning products as the company looks forward to a better-than-expected 2020.
Laxman Narasimhan said lessons from the past show that consumers will incorporate new routines if they keep them up for around two months.
“We have gone back in time and looked at what we have seen when there have been other outbreaks, like Sars and Mers. And what you see is that there is a step up in consumption – a step up in both penetration, which is sustained, and then frequency of use,” he said on a call with reporters on Tuesday morning.
“It won’t be at the peak levels that you might see today. But if you compare it to pre-Covid times, we expect that the levels will be higher.”
We've released our half year results for 2020: reporting like-for-like growth of 11.9%. We will continue to put the needs of our consumers first, making sure our products are available as widely as possible. Learn more: https://t.co/NRgKRNvWnl #WeAreRB pic.twitter.com/VFR80ftyG1— RB (@discoverRB) July 28, 2020
His comments came as the company said 2020 will be better than it had forecast in April as Dettol sales soared.
The consumer goods giant said that sales in its health business, which includes Dettol, increased by 9.3% in the first half of the financial year.
This was despite a fall in sales for Durex due to what Mr Narasimhan called “lower social interactions”.
Meanwhile, the hygiene business, which sells Lysol and Finish, grew by 16%. Overall sales were up 11.9% on a like-for-like basis, RB said.
The British-Dutch business has seen a “very strong shift to ecommerce,” Mr Narasimhan said.
Online sales have jumped 60% and now make up 12% of the company’s revenue.
Mr Narasimhan said: “The first six months of 2020 have been underpinned by resilience, agility and strong execution. I’m incredibly proud of the effort of our people, who have worked tirelessly, while staying safe, with focus and dedication in an environment that’s been changing daily.
“We have the largest portfolio of surface disinfectant brands, including Dettol, Lysol and Sagrotan. Our largest brands are trusted by our consumers, as is evident in their performance.”
He added: “Our hygiene and base health businesses have both performed well, with strong volume growth in challenging circumstances.”