Marketing channels and penetration
Salt chlorination has certainly gained more acceptance, rivalling conventional liquid and tablet chlorine as a sanitization system for new pools in both the U.S. and Canada. The evidence lies in the actions of the pool builders themselves.
Today, approximately 70 to 80 per cent of all new pools being constructed in North America are equipped with salt chlorination. It is fortunate that, with the nearly 80 per cent reduction in new pool construction since 2006, the salt chlorination business has not been strictly tied to new pool construction. In 2010, about 75 per cent of salt chlorination system sales were aftermarket sales; only an estimated 25 per cent of sales were done through new pool construction. These aftermarket sales are being driven by large North American ‘bricks and mortar’ and Internet-based retailers. In fact, the growth rate of salt systems in the pool service channel in the U.S. has been estimated at approximately 50 per cent from 2007 to 2010. This type of aftermarket activity has prevented what could have been a disastrous outcome for the salt chlorination business during the economic crisis of the past few years.
Despite the widespread acceptance of salt chlorination, there are regional differences in market penetration. Naturally, there has been greater penetration in the ‘sunbelt’ market versus the ‘frostbelt’ areas.4 In these warmer regions, where pools may be open 12 months of the year, the convenience of automatic chlorine production is very compelling to many inground pool owners. In fact, in sunbelt areas, the cost of ownership of a salt chlorination system is generally less than conventional chlorine over the lifetime of the product.
| DRIVING MARKET FORCES BEHIND SALT CHLORINATION GROWTH |
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| • Rising chlorine prices, which makes salt chlorination a more attractive sanitization option; • Rising consumer awareness, due to more product offerings, consumer and word-of-mouth advertising (including social media); • Economic downturn, which lead to more ‘staycations’ and backyard investment; and • Pool builders and service professionals creating awareness. |
The tipping point
Generally speaking, a market has reached a tipping point when a critical mass is achieved that enables an irreversible development. Has the salt chlorination business reached such a milestone? In short, even with the positive indications described above, it is too early to be sure.
The greatest influencing factors in the future will be the market price of chlorine versus that of ruthenium. Ruthenium is the precious metal catalyst that comprises the majority of the cost of a salt chlorination system. As long as the price ratio of these key raw materials stays within a certain range, salt chlorination should continue to gain greater market penetration. This, of course, assumes no new technology for pool sanitization will be invented or introduced; given the dominance of chlorine as the water sanitizer of choice for the last century, this seems unlikely. Furthermore, it also assumes salt chlorination technology is stagnant. However, many new salt chlorination developments have been recently introduced, while others are imminent.
Finally, with each passing day, a greater number of pool and spa retailers are experiencing firsthand the profitability and customer satisfaction that comes with the promotion of a salt chlorination system. Hesitance to promote the technology—perhaps due to its potential to decrease store foot traffic, thanks to the longevity of a single salt cell—is waning. With nearly four million inground pools in North America not equipped with salt chlorination and new construction near all-time lows, the future of salt chlorination may still be uncertain. However, by any measure, it will be played out in the aftermarket and promises to be an exciting business for years to come.
| CONSUMER BENEFITS OF SALT CHLORINATION |
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| Enhanced swimming experience • Softer water; • Red eyes and skin irritation reduced; • No chlorine odour; and • No bleaching of clothing or toys.Increased safety • Reduces handling and storage of toxic chemicals; • No harsh chemical shocking necessary; • Even, consistent chlorine dispersion, without highs and lows; and • No caustic or harmful byproducts. Reduced maintenance and costs |
Ray Denkewicz is the global product manager for sanitization and chemical automation for Hayward Industries, a pool equipment manufacturer. He has been involved in the pool and spa industry since 1994, during which time he has developed and commercialized a number of products. Denkewicz, current chair of the National Sanitation Foundation subcommittee on salt, has also been an active contributor to technical groups and committees with various pool and spa associations in the U.S. and has co-authored three symposia on water chemistry.
