TOOTHPASTE INDUSTRY: AN OVERVIEW
The toothpaste history
in India can be tracked back from 1975 with 1200 tonnes of toothpaste
produced by the toothpaste industry. Prior to the toothpastes Oral Hygiene
was the domain of local home made powders and ayurvedh practitioners. With
the entry of Colgate in Indian marketplace the awareness about Oral care and
the importance of oral care. In recent years the Industry has shown
impressive growth rate of 18.6% (this growth is calculated in terms of value
growth in Rs. ).
The growth in the Urban
market has been largely by the Gel Segment. Presently, a large chunk of the
Market is still held by Colgate. The major players in the toothpaste
Industry being Colgate Palmolive and Hindustan Lever Limited and several
minor players like Balsara hygiene, Dabur etc.
Presently Colgate Dental
Cream holds 52% of market share. HLL’s Close up lies far behind with
23% of the existing market share. The third player in the marketplace in
terms of market share is Colgate Gel with 10.5% of the market share. That
leaves 14.5% market share for other Brands like Pepsodent, Pepsodent G,
Promise, Babool, Sensofoam, Forhans, Cibaca, Neem, Vicco etc. The toothpaste
market is presently valued at Rs. 750 crores out of which the Gel segment
has already bagged 1/3rd portion of it. The Gel segment presently
stands at Rs. 248 crores and is growing at a rate much faster
than Cream. In India toothpaste usage as compared to other countries is very
low which signifies about the potential of the market. In Urban India
the usage of toothpaste per person per year is just 190gms. Where as it is
200gms of toothpaste per person per year in developing countries as
Indonesia and Thailand. In developed countries as USA and other European
countries the toothpaste usage is 375 gms per person year. In India the
toothpastes companies are going in for advertising on a heavy note, on an
average the companies managing this FMCG category are spending 6.15% of
their sales on development. Colgate Palmolive had shelled out 15% of their
sales on ads in the year 1994. Dabur had an ad expenditure of 5.07% for the
year 1993. whereas balsara Hygiene spend a huge 10.17% of their sales.
TOOTHPASTE COMPANIES AND
TOOTHPASTE BRANDS
|
(1) Company |
: |
Shri Niranjan Aurvedh
Bhawan, Tumsur (Mah) |
|
Product Range |
: |
Niranjan |
|
(a) 200 gm Tube |
|
Rs |
|
(b) 100 gm Tube |
|
Rs |
|
(c) 50 gm Tube |
|
Rs |
|
Segmenting Factor |
: |
Veg. / Non-veg.
Population |
|
Target |
: |
20% educate customers
that all toothpastes have di-calcium phosphate or bone ash which is
animal based. Whereas they use calcium rich PIPAL insted. |
|
Availability |
: |
Maharastra |
|
Distributors |
: |
107 (newly appointed) |
|
Positioning Stance |
: |
Yoga For Teeth. |
|
Direct Competitor |
: |
Vicco Vajradanti, but
they feel that will beat them in the price game as VICCO’s 200 gm tube
for Rs 44. |
|
(2) Company |
: |
Hindustan Lever
Limited |
|
Brand Name |
: |
Close Up |
|
Marketed By |
: |
Hindustan Lever
limited (HLL) |
|
Product Range |
: |
Close Up (Red, Green,
Blue) |
|
|
|
50 gm Rs
100 gm Rs
150 gm Rs
|
|
Pepsodent |
: |
50 GM Rs
100 GM Rs
200 GM Rs
|
|
Pepsodent G |
: |
50 gm Rs
150 gm Rs
|
|
Segmenting Factor |
: |
Age |
|
Targeted At |
: |
Young people. The
target market being “Multi Brand Households” where young does not use
what their parents. This particular targeting was significant when
Close Up was launched because Colgate positioning was a sort of Flip
flop between Tooth decay and Bad Breath and Colgate was going for
a Broad market constituting of all the age groups. |
Sought to be perceived by
the customers was Fresh Breath. The physical appearance by the users, the
Bright Red Gel synerized well with the Fresh breath Benefit. The advertising
account was handled by LINTAS which focused on Fresh Breath that brought
teenagers closer.
By 1980 Close Up had 3%
of the 16,000 tonnes toothpaste market. The production capacity was doubled
through a deal with third party manufacturer and the Brand was taken
National over the next year and a half, the Premium slashed by 30%. In
1983 Colgate started fearing after witnessing a downfall in market share and
started airing its campaign by inviting customers into its Dental ring of
confidence, by stressing more on breath and posing as a complete toothpaste.
Close Up countered this move by sharpening product benefits, while urging
the customers to do the HA test by blowing air on the palm, the message was
that Close Up feels a lot cooler which reiterated the basic benefit of a
fresh breath.
1987 was a “Probe into
Problem” year for HALL as Close Up was much below expectations with only
4.5% of the 32,000 tonnes toothpaste market. They identified two basic
problems:
(1) Appearance of
Toothpastes detracts prospects from its serious buyers.
(2) Commercials displayed
too much of proximity between couples which was too much for a mother, who
actually purchased the Toiletries.
1998 Lever reworked 3 Ps
in its Marketing mix in Tamil Nadu where people have a strong sense of Oral
Hygiene and the area has a cost effective media Reach. The three reworked Ps
are as follows:
(1)
Product :
·
Blue mint flavour
introduced.
·
Tangerines of Read
reduced. (for serious buyers.)
·
Soft Squeeze lamitubes
for toothpastes introduced for the first time in the country.
(2) Communication
·
Advertisement focus moved
from spotlight to Gregarious couples. This group orientation was more
acceptable to the Mother.
(3) Distribution
·
Took Brand to Sub Urban
and Rural areas.
·
Posters and Mobile Vans
arrived in areas where Urban lifestyle was a matter of aspiration. This was
a purposeful move as the company did not want the Brand to be saddled with a
restrictive.
Up market image
In the year 1990, Colgate
followed Close Up by launch of it’s Blue Colgate Gel. It was targeted at the
youngsters within its Brand fold who were seeking Freshness. It was priced
at par with Close Up gel. The Colgate ad showed a fluorescent Blue spiral
round the users body and it talked of Fresh Breath Energy. By this time Gel
became the Battleground in order to become the leader because:
*
There is rapid
expansion in gel segment.
*
Youngsters thought white
paste to be outdated.
In 1991, Close Up
launched Zing Green and simultaneously Lever sponsored “Close Up Sangeet
Muquabala” targeted at the rural youth. In 1991 Close Up’s market share
increased to 16% of Rs 377 crores per year market. 1991 witnessed a few
problems for Close Up Blue, which was faltering on repeat purchases as
customers did not perceive much freshness value in it. In 1992, HLL
launched “AQUA BLUE” with added attributes like increased Mouthwash contents
and a more Minter flavour, so that customer’s perceived benefit is Freshness
which is Lever’s Positioning stance. In response Colgate introduced “Red
Actirinse” and then “Colgate Blue”. People at HLL thought to counter
Colgate’s growth by cashing in on Medicinal appeal and came out with
“Pepsodent” with Germicheck snf “Mentadent G” now renamed as “Pepsodent G”
for Gum problems. Colgate countered this move by launching “Colgate Total”
as an advanced paste to fight.
Tartar, Gingivitis, and
other Dental ailments. 1993 was the year when HLL tried to woo the customers
by innovative packaging. Firstly it introduced “Stand Up Pump dispensers”
for metros but it bombed in the market because of High price perception as
compared to benefits. Sachets formula was used by lever to break into
Colgate’s fort. The Close Up sachets was priced at Rs. 3 per unit and
it offered 20 uses, which means that a family of five could use
it four times each. The year it sponsored zee Close Up Antaksharee. HLL also
went in for Close Up Toothbrushes under the Brand name “Confident” and
launched it in Tamil Nadu.
The confident
toothbrushes were taken National and most importantly HLL advertisement
account shifted from LINTAS to FTA due to
Global alignment move by
Lever’s parent Unilever. The brief given to the new agency was to
“Strengthen the Audience’s perception of Brand’s functional values.”
Close Up’s formulation
was reworked and the new Close Up was enriched with “Microwhiteners” so that
the perceived benefit by the customer be that he will have Shining Teeth. As
the ad account was handed over to HTA, the ad moved closer to the Indian
Culture, they also took note of the cultural changes which showed in their
ads like Females were now more than equal participants in Boy Girl activity
as in Salim Anarkali ad which showed her confidence by joining the Boy on
the stage and saving the day.
1996 witnessed
introduction of “Close Up Liquifresh” a liquid in a carry along squeeze can
in two sizes :
HLL gave it a dual
positioning platform of a Mouthrinse and a toothpaste, like squeeze the Gel
directly into Mouth. Close Up is pushing hard for semi Urban and Rural areas
were disposable incomes are rising rapidly and in order to tap these markets
it is going for Vernacular Advertising in Eight languages. In Bengal as the
communication did not work all that work initially, HTA has contracted Anjan
Dutta a signer popular with both Young and old alike in Bengal.
3) Company :
Colgate Palmolive (India) Limited
Brand : Colgate
Product Range :
1. Colgate dental Cream
*
50 gm
Rs.
*
100 gm
Rs.
*
150 gm
Rs.
*
200 gm
Rs.
*
250 gm
2. Colgate Gel (Blue and
Red)
·
50 gm
Rs.
·
100 gm
Rs.
·
150 gm
Rs.
·
200 gm
Rs.
·
250 gm
Rs. -
3. Colgate Total
·
50 gm
Rs. -
·
100 gm
Rs.
·
150 gm
Rs. -
·
200 gm
Rs. -
4. Colgate Calciguard
·
50 gm
Rs. -
·
100 gm
Rs. -
·
150 gm
Rs. -
·
200 gm
Rs. -
5. Colgate Sensitive
Segmenting Factor :
Family
Target Audience :
The Brand Colgate and
it’s extensions are targeted at Indian families taking booth economical and
premium stances.
Availability : All over
India.
Positioning Stance :
on Health
care through Duality of benefits, talks about “Stops bad breath and fights
tooth decay.” This positioning stance has worked well in Indian probably
because Oral. Now also the company is constantly following the fresh breath
route which proved successful for the company.
Care is not taken in a sensitized manner and
hence the custom looks for multi-benefits.
History of Colgate :
For people in Colgate
volume is the key. This is the Mantra for India a. Today the Indian arm is
one of the top 10 subsidiaries of the global giant ; one of the top three
volume drivers in toothpastes. In India, the Multinational is first and
foremost identified with Toothpaste (Dental care) are currently there is a
lot of curiosity on how C-P is responding to the challenges that HLL is
throwing it’s way. On toothpastes, where C-P claims an overall 62.3 percent
market share a clear cut strategy is evident i.e. maintaining leadership in
Oral care and expand the oral care market size. Consistency of communication
is of strategic importance. More so in an increasingly cluttered
environment. Vice President of C-P (India) limited dually complies “We have
not changed the platform - Duality of Benefits - for the last 15 years.”
The main growth in the
Urban toothpaste market for C-P has for sometime been coming from the Gel
segment. Colgate gel has been performing well with it’s market share
standing at 11 percent and a growth faster than Close Up’s market share,
which has declined by the end of 96.
In an effort to
capitalize in the growth, C-P recently introduced it’s latest extensions,
Fresh Stripes, with “Stripes of Benefit”. this latest launch brings C-P’s
toothpastes to a total of six, with mega Brand Colgate Dental Cream (CDC),
the category volume driver; Colgate Gel-Positioned as giving long lasting
fresh breath; Calciguard with an anti cavity therapeutic positioning
marketed in the Metros; Colgate Total with it’s therapeutic positioning and
multi benefits and Colgate Sensitive being Marketed through Dental
Profession.
To expand the category,
C-P has an on going Rural Van programme, rather similar to the HLL idea of
expanding the market and also not being confused as a premium consumers. An
intensive investment this Video van develops the market by teaching people
to use a brush or seen a finger properly to clean their teeth with the Big
Red CDC. In addition there is also a school programme which covered 1.5
million children last year. According to Rechard Usuquen VP C-P (India) Ltd.
C-P’s action will center around finely balancing the Urban market - where it
claims a 59.5 percent market share - with the Rural where it claims a 68 per
cent share. So while the company has introduced such premium packaging as
stand-up toothpaste tubes with Flip up caps in the Urban market, it is
also selling sachets of CDC at low prices.
In 2001, the company has
come up with a lot of schemes such as 25% extra in 100gm pack. In 50% gm
pack there is an off of Rs 5.5. In 200gm pack the company is providing 2 toy
planes for kids. They are also providing a lot of discount and incentives to
its stockiest and retailers. They have also come up with transparent
packaging in gel segment to attract the customers.
DATA FOR THE TOOTHPASTE INDUSTRY
:
(A)
ZONE WISE SEGMENTATION :
ZONE
PERCENTAGE
EAST
21%
NORTH
25%
WEST
21%
SOUTH
33%
(B) SEGMENTATION AS RURAL AND
URBAN MARKETS :
RURAL MARKET
40%
URBAN MARKET
60%
The above segmentation details gives us an overall scenario of the
toothpaste industry. As seen from the zone wise segmentation table, the
distribution is fairly even in all the zones. Also the rural to urban
markets ratio is 40:60 which is expected and thus no surprises are seen from
this data or rather no unusual variation is observed.
(C) MARKET SHARE OF MAJOR PLAYERS
OF THE INDUSTRY :
NAME
% SHARE
COLGATE DENTAL
46
COLGATE GEL
10
CIBACA
3
CLOSE UP
18
PEPSODENT
09
PROMISE
9.5
BABOOL
0.5
The data tabulated above clearly supports the fact that Colgate and HLL
products are way ahead as far as market share goes. These brands have earned
a place in customers minds or speaking in a technical term they have been
positioned in the customer's minds.
Secondly, the brands like Promise and Babool are catering to a very specific
segment of customers which is the Herbal toothpaste user segment. Thus, they
also have positioned themselves as Herbal toothpastes and hence they always
target the same segment. This can be termed as a 'niche market' which they
are catering to these segments.
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