Turtle Wax, Inc. History

Address:

5655 W. 73rd Street
Chicago, Illinois 60638
U.S.A.

Telephone: (708) 563-3600
Fax: (708) 563-4302

Private Company
Incorporated: 1941
Employees: 600
Sales: $145 million (1994 est.)
SICs: 2842 Polishes & Sanitation Goods

Company History:

Turtle Wax, Inc. is the world's largest manufacturer of car-care products. The Chicago-based company controls over 60 percent of the U.S. car wax market and sells its products in Europe, the Pacific Basin, and Central and South America. It also markets chemicals for commercial car washes, owns and operates the largest chain of full-service car washes in the Chicago market, and manufactures shoe polishes and household cleaners. The family-owned business had estimated revenues of $145 million in 1994, according to Crain's Chicago Business.

Benjamin Hirsch, the founder of Turtle Wax, wanted to be a chemist, but had to drop out of college during the Great Depression. Instead, he became a magician, supporting his family with his silks and wand. But he never lost his interest in chemistry nor his fascination with cars. In the late 1930s he developed a car wax and mixed up batches at night in the bathtub. His wife, Marie, filled the bottles by hand. During the day, Hirsch traveled by street car to gas stations around Chicago, selling the wax he named Plastone. In 1941, he invested $500 and opened the Plastone Co., which operated out of a series of storefronts.

To promote his wax, Hirsch would go into a parking lot and shine one fender of each car. He then waited for the owners to arrive and hope to convince them to buy his wax to finish the job. Plastone was a couple of years old when, according to company lore, Hirsch made a sales call in Turtle Creek, Wisconsin. The name of the town clicked in his mind with the hard shell of a turtle and the protection his wax offered. Thus was born a new name for the company and for the wax, Turtle Wax Super Hard Shell.

In the early years, Hirsch nearly went bankrupt several times. "It was an arduous period," remembered Turtle Wax chairman Sondra Hirsch Healy in a 1993 Chicago Tribune article. "We moved around a lot in the Chicago area. I can remember we, my brother and I, slept on the countertop of this storefront on Clark Street." Her father kept the company going by borrowing money from his employees and giving them stock in repayment. Some of those employees, or their children, relatives, and friends, still worked for Turtle Wax in the mid-1990s.

As the popularity of the wax grew, Hirsch wanted to diversify. To appeal to a larger group of customers, he saw the need to sell products through grocery stores, not just to gas stations and hardware stores. In the mid-1950s Hirsch branched out, developing shoe polish, rug shampoo, and floor wax. The company even produced a line of dessert toppings called Party Day.

By 1966, the company boasted huge factory facilities. Its brand-name products, for auto care and household cleaning, had established a foothold in the market, and the firm had just opened a factory in England. Then Hirsch died. As was the case with many fledgling family companies, there was no plan for succession, and Hirsch's widow took over control of the firm. His daughter Sondra, a graduate of the Goodman School of Drama, left her job teaching drama in the Wilmette schools and joined the company as vice-president of public relations. "I felt I had to hold the company together," she told the Chicago Tribune in 1993.

Hirsch had been the developer and marketer of the company. With his death, the family followed the conservative advice of those who believed the company had to concentrate on the company's automotive products to survive. Products not related to car care were eliminated, and the company was 99 percent automotive by 1971, the year in which Mrs. Hirsch died. That year, Sondra Hirsch married Denis Healy, a chemist and product developer whom she had met at a trade show in Miami Beach in 1970. Healy joined Turtle Wax as general vice-president. In 1972, Sondra Healy was named chairman of the board, and, in 1977, Denis Healy became president of the company.

Denis Healy had spent most of his career developing new products. He started with Colgate-Palmolive, then moved to the Mennan Co., and finally to the Barr Co., a packager of aerosol and liquid products. With this background, he began rebuilding Turtle Wax's marketing and development efforts, in both the automotive and broader consumer markets.

In 1982, the company introduced several new car-care products. Minute Wax, a silicone-based spray wax, was aimed at the increasing numbers of women who drove and maintained their own cars. For the growing number of older cars on the road, Color Back, a finish restorer, was developed to revive dull finishes. Another introduction, Clear Coat, was a non-abrasive wax and polish designed for new cars.

The Healys also reinstituted Ben Hirsh's efforts to move more strongly into supermarkets and consumer products. John Dellert, then vice-president of marketing, explained the company's strategy for moving into new markets in a 1985 Advertising Age article: "We had to come up with what we felt was a unique product that could command a much higher price and then could support advertising to educate the consumer on our presence in the category."

They began with shoe polish. In 1983, the company introduced a six-color line of Turtle Wax Shoe Polish. After success in test markets, the line went national, representing the first phase of the supermarket assault. At the time, the $125 million retail shoe polish and paste business was dominated by Kiwi. Marketed in the U.S. by Sara Lee Corp.'s Kiwi Polish Co., Kiwi accounted for nearly 80 percent of the market. To convince grocery store buyers to stock its polish, Turtle Wax priced its 3.5 oz. bottles at $2.49, with a built-in margin of $1.12 for retailers, compared to a 95¢ price and 50¢ margin for Kiwi.

Once the polish was on the shelves, Turtle Wax launched a $2 million television advertising campaign, larger than any previous introduction for a shoe polish. During 1984, the company spent $1.9 million (58 percent of all the advertising dollars for shoe care products for the year) advertising Turtle Wax Shoe Polish. Within a year, Turtle Wax ranked second, above American Home Product Corp.'s Griffin and Knomark's Esquire polishes, with nearly ten percent of the market. The campaign also gained the company valuable shelf space at many mass merchandiser and retail outlets.

Turtle Wax used the same strategy to take on Armor All, which introduced the first vinyl protectant/beautifier in 1974, and, within 11 years, had 80 percent or more of the estimated $175 million vinyl protectant retail business. Turtle Wax developed Clear Guard and introduced it in 1985, pricing it higher to give retailers a larger margin and unleashing an advertising blitz and rebate offer to lure customers away from Armor All. Unlike other brands on the market, Clear Guard contained no water. A spray, it was packaged in a unique, beaker-type bottle, in five-, ten-, and 16-ounce sizes, all premium priced. The ad campaign compared the new product's clear spray with Armor All's cloudy spray, with the tagline, "Introducing new Clear Guard from Turtle Wax...a clear new challenge to Armor All."

In 1985, Turtle Wax introduced a disposable wax-coated cloth and wax-filled sponge, which offered convenience and less mess. During this time, the company also undertook its first licensing agreement. Together with American Greetings Corp., Turtle Wax introduced a line of air fresheners for children's bedrooms. Turtle Wax took the technology it had been using for years to make air fresheners in the shapes of playing cards and dice and packaged them to resemble the Strawberry Shortcake and Care Bears characters. "That's a sort of test for us," Denis Healy told Advertising Age at the time. "We're looking to license our name and we're looking to license other people's names."

With its consumer products division well underway, Turtle Wax created an industrial products division in 1985. The new division reflected the company's decision to place more emphasis on the potential business in the industrial market and not to focus only on the retail arena. "Because of our name, we've grown by osmosis into developing bulk chemicals [soaps and waxes] for the car wash business. It was treated as kind of a weak sister, but the business still grew a respectable 5 percent to 10 percent each year," Charles Abate, vice-president of operations and industrial products, told the Chicago Tribune in 1986. "The key is to remember that we are a surface treatment company," said Turtle Wax President Denis Healy in the same article.

The new division first concentrated on the car wash industry, which in 1986 had an estimated 9,000 firms across the country, ranging from large chains to small neighborhood operations. Although the technology of the car wash business had changed dramatically in the previous decade, little attention had been given by most manufacturers to developing soaps and waxes appropriate for the new equipment and the lightweight plastics used in cars. Turtle Wax saw an opportunity--and had the financial resources&mdashø develop a national distributor network for its industrial products.

By 1995, the company was the name brand marketer of chemicals for the commercial car wash industry. It marketed a full line of products to all types of car washes through Sam's Club stores and through distributors of car wash chemicals and equipment. The industrial division manufactured six Turtle products: car wash pre-soak, two types of foaming detergent, sealer wax, foaming brush detergent, and high pressure powder detergent. Users in 1995 included 12,000 self-service car wash operations, 9,000 exterior car washes, 9,000 full-service operations, as well as pressure wash operators cleaning trucks, buses, and trains.

Throughout the last half of the 1980s and into the 1990s, Turtle Wax continued to develop new products. 1986 saw the introduction of household cleaning products. "Every bit of research we've done shows not only a high consumer awareness of our name but a perception that we've been selling household products for some time," Charles A. "Chuck" Tornabene, vice-president of marketing, explained in a May 5, 1986 Chicago Tribune article.

That year, six new products came on the market from the consumer products division. Rust Eater, designed to "convert rust to a primed surface that will never re-rust," was introduced with a big television ad campaign and customer rebate program. Three new aerosol products, under the Turtle Wax name, included a spot remover, an upholstery cleaner, and a carpet cleaner. Graphics of pets adorned the packages of the new cleaners, highlighting the special formulation of the products to get rid of pet stains and odors. Repel fabric protector and the Brillante brand of metal polishes were also marketed under the Turtle Wax umbrella.

The company also faced some challenges during this time. In 1986, for example, Turtle Wax agreed to pay nearly $100,000 in civil penalties and to discontinue its use of "potentially deceptive containers," which were not, according to allegations, filled to capacity. The payment settled a lawsuit filed by the district attorney's office in Los Angeles.

In the mid-1980s, Turtle Wax's automotive division responded to changing trends in the car care industry by adding new automotive products. 1987 saw the introduction of Zip Wax Hydro-System Spray Wash. A person needed only to attach a garden hose to the fitting on top of the plastic bottle and he or she could wash and wax a car. The product came in three formulations: wash, wax and wash, and wax. That same year the company also introduced a non-abrasive car wax, aimed at new cars, and a Clean Machine Car Detailer for cleaning all car surfaces, inside and out. At the time, Turtle Wax had an impressive 40 percent share of the $120 million-a-year car wax and polish market. Top-selling Super Hard Shell alone reached a 29 percent share of the overall market, a new high.

In 1988, the company entered the premium segment of the car wax market with Turtle Wax Plus with Teflon. This put the company head to head with Rain Dance, which had been the dominant brand among premium car waxes. Premium waxes accounted for about 20 percent of retail car wax sales. The company worked on the new product for 16 months, during which time it had to convince Du Pont that its Teflon could be functionally used in a mass-market car wax. Until this product, the only Teflon car waxes available were for the professional market. The new wax sold for about $2 more than mid-priced or premium-priced car waxes, including Turtle Wax Super Hard Shell, which had increased its market share to 30 percent.

Determined to reach into every segment of the market, the company introduced Liquid Crystal into the super-premium segment of the car wax market in 1989. For the first time in the company's history, the name Turtle Wax was not associated in any way with the product. Aimed at car buffs, the suggested retail price for Liquid Crystal was $15 to $16, while Super Hard Turtle Wax sold for $4 to $5.

Demographic and consumer research by Turtle Wax showed that about half of all automobile owners regularly washed and waxed their vehicles, and 90 percent would give their cars a basic cleaning "from time to time." The heaviest users were people, primarily 18- to 40-year-old males, who regarded their car as an extension of themselves. But women were a growing segment of the market, representing about 40 percent of the car care product market in 1991, up from about 25 percent ten years earlier.

In 1993, Turtle Wax expanded its overseas operations, increasing its presence in Europe and entering into a deal with one of Japan's largest auto retail chains. New products during this period included Formula 2001, to protect new tires; Instant Foam 'n Shine, the first no-wait car wax; and Color Wax, a car wax that came in different colors to match a car's paint job. Phil Katcher, products editor at Automotive Marketing, a trade publication, told the Chicago Tribune: "That product breathed a lot of life into what was a pretty stagnant market. The car wax market had been hurt by automakers switching to no-wax car finishes."

Continuing to go after the top segments of the market, in 1995 Turtle Wax took aim at classic car owners. The company teamed up with Chuck Bennett, maker of Zymol Natural Liquid Auto Polish, to offer the pricey polish ($20 a bottle) to the mass market. The polish contained coconut and banana oils, almond paste and aloe, and a touch of vitamin E. Turtle Wax also announced it would use informercials to introduce two new products in 1996: Lubricator 2001 is a new engine treatment and Sudden Shine is an auto polish.

In addition to its three products divisions, Turtle Wax also owned and operated the largest chain of full-service car washes in the Chicago area through its auto appearance division. Turtle Wax's Car Wash and Auto Appearance Centers provided a wide-ranging menu of detailing services as well as car washes. The centers also served as a testing ground for Industrial Division products. The first ten centers were located in buildings converted from other uses. In 1990, Turtle Wax hired the Chicago architectural firm of Perkins & Will to design two state-of-the-art facilities, in Bloomingdale and Aurora, Illinois. To attract and keep customers, the centers offered yearly wash plans. For $199 (in 1994), a plan member received unlimited car washes on weekdays; for $259, the car could be washed on weekends as well.

As the company entered the last half of the 1990s, Turtle Wax car waxes had over a 60 percent share of the market, with a 95 percent brand awareness. Products from the automotive division were being marketed in Europe (the United Kingdom, Germany, Scandinavia), Central and South America (Mexico, Venezuela, Panama), Australia, and the Far East (Japan, South Korea). Through its industrial division, the company was the name brand marketer of chemicals for the commercial car wash industry. Items from the consumer products division including shoe polish, furniture polish, and other polishes and cleaners were sold through food, drug, and mass merchandise chains. The Healys and their family-owned firm appeared to be successfully carrying on Benjamin Hirsch's dreams.

Turtle Wax, Inc. History

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