Schoolgirl Complexion

To Milwaukee Soapmaker Caleb Johnson, president of Palmolive Co., the Russian Revolution was a nuisance. On the day they assassinated the Tsar, a boatload of his pet Palmolive Soap was ploughing the grey Pacific, Vladivostok-bound, By the time it reached Japan the Russians were too busy to wash. The Japanese, no great shakes as soap consumers themselves, let the cargo pile up storage fees for three years. Finally, Soapman Johnson got a tip: Australia needed soap. To Sydney went the lot. Australians snapped it up at 30-c- a cake.

When Palmolive merged with Kansas City's Peet Bros. (Crystal White Laundry Soap) in 1926, old Caleb Johnson was two years in his grave. When the combine took over the 122-year-old firm of Colgate & Co. (toothpaste, talcum powder, etc.) in 1928, his familiar green Palmolive Soap became the prima donna of the No. 2 U. S. soapmakers*--Colgate-Palmolive-Peet Co. Today more people the world over wash with Palmolive (retail price: 7-c- a cake) than with any other toilet-soap. One reason for that is the factory Caleb Johnson built in soap-loving Australia. Chief soap supplier for Down Under, it is now one of the richest cogs in Colgate-Palmolive-Peet's worldwide distribution system, a prime reason why the company dwarfs all native U. S. firms in foreign markets (25% of C-P-P sales).

Off to a good start, C-P-P took it on the chin when Depression I got going. From a comfortable $7,598,224 in 1931, profits kerplunked to a miserable $53,301 the next year. Reason: the stubbornness of President Charles Pearce (a Johnson man) in trying to hold his top-heavy volume in the face of rising distribution costs and collapsing soap prices. Up rose young (35) S. Bayard Colgate, great-grandson of the founder. Using his family's 40% ownership of the firm's stock as a lever, he booted Pearce out, took over the presidency, in one year had the company once more on an even keel.

When Yaleman Colgate kicked himself upstairs to the chairmanship two years ago, he turned the presidency over to big, hard-working Edward Herman Little. A North Carolina farmer boy, Soapman Little was doing fine as Colgate's Memphis district manager when tuberculosis sent him to Denver in 1911. Three years later he came back, cured, went to work for Caleb Johnson, rode out the mergers, took over Palmolive-Peet's foreign division and boomed it. In his two years as president he has stepped up his firm's gross profit from .3% to 10% of sales. What that means was handsomely illustrated in C-P-P's preliminary annual report for 1939, out last week. Total sales were a whopping $101,935,438--highest in the company's history. Net profit was a neat $6,632,654 --highest since 1931, 35% over 1938.

Gratifying as this was to President Little, it was no more than a temporary solace. For a universal commodity like soap has to be sold in heroic amounts to make money, and, unfortunately, there is little to choose between soaps. Hence competition is nerve-racking, with Procter & Gamble hanging on to some 40% of the U. S. business, C-P-P and Lever Bros. doing about 20% apiece -- 200-odd soapmakers scrapping for the rest. Chief competitive weapon: advertising, for which the soapmakers' bill was a cool $40,000,000 last year. It cost C-P-P alone a good $8,000,000 to remind its Palmolive Soap buyers to "Keep That Schoolgirl Complexion," buy its 432 additional toilet items. Of that sum over two-thirds went into radio: Gang Busters, Myrt & Marge, Dale Carnegie, etc.

Result of this advertising fracas is that Americans are the cleanest people on earth. Annually they scrub themselves and belongings with some 24 Ibs. (equal to almost 110 toilet-size cakes) of soap apiece. Next come the Dutch, two pounds under the U. S. record. With its worldwide coverage in soaps C-P-P would be sitting pretty if other nations would follow suit. The hot-water-bathing Japanese, for instance. Last year the race that scorned Caleb Johnson's Palmolive did no better than six cakes of soap apiece.

* No. 1: Procter & Gamble Co. (Ivory); No. 3: Lever Bros. (Lifebuoy, Rinso, Lux), U. S. subsidiary of mammoth British Lever Bros. & Unilever, Ltd., No. 1 world soapmakers.

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