Dividend Aristocrats Part 14 Of 52: Clorox

Clorox (CLX) was founded in Oakland California in 1913.  The company is still headquartered in Oakland, and currently employees around 7,700 people.

Since 1913, Clorox has grown significantly.  The company now has a market cap of $15.8 billion.  The company is remarkably consistent.  Clorox has increased its dividend payments for 38 consecutive years and has a history of rewarding shareholders with share repurchases as well.

Clorox sells branded consumer products.  Several of the company’s most well-known brands are listed below:

  • Pine-Sol
  • Clorox Bleach
  • Glad trash bags
  • Brita water filters
  • Kingsford charcoal
  • Fresh Step cat litter
  • Burt’s Bees natural products
  • Hidden Valley Ranch Dressing
  • The image below gives a concise breakdown of Clorox’ brands, including a revenue breakdown.  Note that 80% of the company’s brands are either #1 or #2 in their respective categories:

    Clorox Brand Breakdown

    Source:  Clorox 2020 Vision Presentation

    Competitive Advantage

    Clorox’ competitive advantage is derived from its strong brands.  The company has a long history of building, strengthening, and acquiring consumer branded products.

    The company has dominant market share in the United States over several product categories, including:

  • ~60% market share in bleach (Clorox brand)
  • ~75% market share in charcoal (Kingsford brand)
  • ~60% market share in water filtration (Brita brand)
  • The company supports its brands by investing heavily in advertising.  Clorox’ advertising budget over the company’s last 3 full fiscal years is shown below:

  • 2015 advertising spend of $523 million
  • 2014 advertising spend of $503 million
  • 2013 advertising spend of $498 million
  • Clorox spends around 9% of its total sales a year directly on advertising.  The company’s large advertising budget helps it to sell its products for premium prices by highlighting the specific benefits of its products.

    Print Friendly, PDF & Email

    Author: Travis Esquivel

    Travis Esquivel is an engineer, passionate soccer player and full-time dad. He enjoys writing about innovation and technology from time to time.

    Share This Post On

    Submit a Comment

    Your email address will not be published. Required fields are marked *