Reckitt to add share in flat U.S. market

Reckitt Benckiser, Executive Vice President North America Rob de Groot, speaks during the Reuters Food and Agriculture Summit in Chicago March 16, 2009.

CHICAGO (Reuters) - Reckitt Benckiser (RB.L), the household cleaning products group, said it expects to increase market share in the United States for its products despite an overall flat market expected in 2009.

The British group which markets Electrasol/Finish dishwasher products, Lysol disinfectants and French's mustard said it expects to raise its share in the markets in which it operates by 1 to 1-/2 percent from around 30 percent in 2008.

"We expect to be around 31 to 31-1/2 percent," said Rob De Groot, head of the group's North America and Australia region, at the Reuters Food and Agriculture Summit in Chicago on Monday.

He added that the group had not seen any effect of the recession in North America hitting its financial numbers yet as its strategy of strong product innovation backed by heavy marketing investment continued to drive growth.

"The start of the recession has been here for the last six months. We haven't seen any recession in our numbers .... There is no reason to doubt that our innovation-led strategy is not working," he added.

De Groot adds that private label brands had not gained market share and that there was no significant effect from trading down to cheaper branded products as consumers were more concerned about performance than absolute price.

"In a recession, people are looking for security, they're looking for predictability and the best predictability that you get are brands that you know," De Groot said.

Reckitt, which also markets health and personal products such as Mucinex cold medicine and Veet hair removal cream, has outperformed most of its rivals in terms of sales growth since Britain's Reckitt & Colman tookover Dutch Benckiser ten years ago.

The group's strategy is based around its 17 powerbrands, such as Airwick air freshener and Woolite fabric cleaner, which produce over 60 percent of group sales, while 40 percent of group sales come from new products launched in the last three years.

Most of the group's major brands in the US market such as Lysol, Airwick, Finish and Mucinex are No 1 or No 2 in their markets, and De Groot plans to maintain or improve their standings by increasing the advertising and promotional budget for these at the same rate as last year.

De Groot's region of North America and Australia accounts for 27 percent of the group's 2008 sales, but these mature markets only showed 6 percent underlying sales growth to underperform the group's overall 10 percent sales growth.

Last month, Reckitt set a target to grow 2009 underlying sales at 4 percent, reflecting the uncertain economic times, but this level of growth is still expected to be twice that of the markets in which it operates.

(Reporting by David Jones, editing by Matthew Lewis)