It doesn't matter where you live or what your annual income is, there are certain household products that we just can't do without -- think laundry detergent, diapers, and batteries. Investing in companies that sell these items can be extremely rewarding, because many of these products are things consumers need to buy on a regular basis. This creates reoccurring revenue streams for the conglomerates selling them and lucrative returns for the shareholders invested in such companies.

With the second half of 2015 now under way, here are two household product stocks to watch.

Church & Dwight
If you're not familiar with the moniker Church & Dwight Co (NYSE:CHD), you certainly know their household brands such as Arm & Hammer, Nair, and OxiClean, to name a few. The 169-year old conglomerate owes its continued success to its relentless pursuit of innovation. In fact, more than a third of the company's net sales last year came from new product launches.

Source: Church & Dwight.

Despite having leading brands in the household products category, the company refuses to rest on its laurels. Church & Dwight has grown its Arm & Hammer brand, for example, from traditional baking soda into other product categories including cat litter, toothpaste, and deodorant. As a result, Arm & Hammer is now a billion dollar brand for the company.

The strength of Arm & Hammer together with the company's other leading brands including Trojan and First Response have helped Church & Dwight deliver compound annual sales growth of 18% over the past decade. Additionally, the company sells a favorable mix of both premium and value brands, which help it navigate economic weakness in consumer spending. As it stands, Church & Dwight's premium household products account for 60% of its annual sales whereas 40% come from its selection of value items.

Church & Dwight currently generates more than 80% of its revenue within the United States. This creates a clear opportunity for the consumer products giant to grow its international business in the year ahead. Ultimately, the company's long-standing commitment to shareholders makes it worthy of investors' attention today. Moreover, a $1,000 investment in Church & Dwight in 2005 would have been worth $5,300 at the end of last year, compared to a mere $1,700 return from the S&P 500 over the same period. This track record of reliable returns makes Church & Dwight a stock worth watching.

Procter & Gamble
You can't discuss household products stocks without mentioning Procter & Gamble (NYSE:PG). Even as Procter & Gamble is in the process of selling some of its under performing brands, the consumer goods giant still boasts 23 brands that each generate annual sales north of $1 billion. This creates an economic moat for P&G that is simply unrivaled in the household products industry today. With around $83 billion in yearly sales, P&G generates enough free cash flow to fund both shareholder returns and product innovation.

A laundry list of brands with household names such as Tide, Pampers, Bounty, Crest, and Gillette have helped Procter & Gamble pay a dividend for the past 124 consecutive years. The company also gets high marks as a dividend aristocrat because it has increased its payout for the past 58-years running. The stock now boasts a dividend yield of 3.32%, which is equal parts reliable and higher than the S&P 500 average yield of 2% today. Procter & Gamble rewarded shareholders to the tune of $12.9 billion in 2014, with dividends accounting for nearly $7 billion in total shareholder returns.

Source: Procter & Gamble. 

Importantly, P&G hasn't boosted shareholder returns at the expense of research and development. Last year, the conglomerate doled out $2 billion in R&D expenditures. Innovative new product offerings including Tide Pods and Downy Infusions have helped the company stay on top of consumer trends in a big way. This level of innovation is particularly impressive from a company that has been in business for more than 177 years -- Cue the slow clap. For that reason, Procter & Gamble is a stock worth watching in the years ahead.

Why household products make great investments
Retailers worldwide rely on household products companies like Church & Dwight and Procter & Gamble for many of the everyday products they stock. This creates a business environment that offers steady returns year round because most of the products are consumer staples or necessities.