Analysis of Toothpaste industry in India – by Ajay Chowdary Bobbur

Introduction

Earlier in India oral hygiene was the domain of local home made ayurvedic powders or natural herbs. The history of toothpaste in India can be traced back in year 1975.Now the awareness regarding oral hygiene in Indian society has increased with the different brands of toothpaste.

Strength Market reach for both rural and urban areaAvailability of raw materialsLow operational cost

WeaknessPoint of parityResearch and development

OpportunitiesPurchasing power

increasesHealth campLow dentist population

ratio

ThreatsWell established competitor subsitutes

Swot analysis

!

Overview

Total market of 750 crores.Growth rate of 18.6% Per capita usage mere 85 gms per person.Major player – Colgate Palmolive and HUL

Top ten tooth pastes

COLGATE (Coalgate Palmolive Ltd.) PEPSODENT (Hindustan unilever) CLOSE UP (Hindustan Unilever) SENSODYNE (GlaxoSmithKline) AQUAFRESH (GlaxoSmithKline) ANCHOR (Anchor health & beauty care Ltd.) DABUR RED (Dabur India) BABOOL (GlaxoSmithKline) MESWAK (GlaxoSmithKline) VICCO BAJRADANTI (Vicco Laboratories)

MARKET SHARES - TOOTHPASTE

3 companies taken for analysis

ColgateHULDabur

Colgate

Introduction

In 1806, William Colgate introduced starch, soap and candle factory on Dutch Street in New York City under the name of "William Colgate & Company".

Colgate – Palmolive company is an American diversified multinational corporation focused on the production, distribution and provision of household, healthcare and personal products, such as soaps, detergents, and oral hygiene products (including toothpaste and toothbrushes).

In 1873, the firm introduced its first toothpaste, an aromatic toothpaste sold in jars.

POSITION IN GLOBAL MARKET

Future strategy on 4p`s basis: 1. Product: 

They try to position some innovative toothpaste with a brand name other than Colgate but under the umbrella of Colgate Palmolive.

Focusing toward rural rich and consuming class by endorsing the development of ‘Colgate Ayurvedic Toothpowder‘.

They would come up sachets of these tooth powder and position toward rural population who buy in smaller lots.

For Urban population, they would come up

with the products suiting to young generation. For Urban rich and consuming class, they would come up with

the products on the basis of functional benefits.

Eg: they launch a special toothpaste for kids in the age group from 4-10 years.

2. Price

Based on the competitor's price .Pricing done on the basis of price points Packaging would be customized on the basis of price

points.

3. Promotion

They positioning Colgate dental white crème and toothpowder towards rural rich segment.

For rural consuming class they endorsing Cibaca toothpaste.

Advertisement through T.V. media, Print media.FM Radio for Urban population & MW and SW radio for

Rural population.Hoarding on National highways.

4. Place

They would try to increase product penetration to rural population.

They would try to increase the wholesalers to smaller towns.

They would track the distribution path so that they are covering all the village areas around the towns

Distribution strategy

Dentists and plastic surgeons.

Drug stores or Grocery stores.

Large retail stores and department stores.

ADVERTISEMENT

In 1940,the Colgate Company used Slogan was "It cleans your breath while it cleans your teeth " .

The 1960s onwards, the slogan was "The Colgate ring of confidence" .

In the late 1950's and early 1960's, Colgate stressed the fact their "Dental Cream" contained Gardol, a formula that helped protect teeth from cavities and tooth decay .

"Gardol" was actually their trademark for the ingredient Sodium lauroyl sarcosinate .

Now they used various Slogan for different different products like For MAX FRESH is “A Whole new Dimension of Freshness” & For WHITE TOOTHPASTE is “All Around Decay Protection”.

Promotional tools

Increasing circumference of toothpaste tube. Free Dental Check-up in mobile vans

Target MarketKids :Sparkling gel comes in 2 exciting variants – Bright Pink gel ,

and Bright Blue gel ,yummy Bubble Fruit flavourTweety and bugs bunny are favourites with kidsThe fruity bubble gum flavour – kids brush longer developing

good oral care habitsFamily :Strong teeth and fresh breath Developed using Colgate’s international expertise in oral careUnique formula protects teeth from decayRefreshing minty flavour makes breath super freshYouth :Icy wave of minty coolness Cooling crystals and emphasis on “taazgi”

People with sensitive teethFights pain due to

sweet/sour/hot/cold foods by desensitising nervesHelps maintain the natural whiteness of your teethSignificant inhibitory effect on the formation of supra-gingival calculusPleasant tasteNotice improvement in 2-4 weeksRelief from the pain of sensitive teethProven protection from sensitivity with regular useFresh breath

Marketing Strategies

Market DominanceMarket leader - dominance in Oral CareCatering to all the segments -long product lineMassive advertising, awareness ,especially in

child segment

Product Differentiation Different packaging for all its product line Changes packaging according to product innovationDifferentiation due to massive promotion on channelsCreate a different image in the eyes of consumers

Innovation StrategyPioneered in new product development and business

model innovation Cutting edge technology- innovation strategy

Segmentation:Colgate’s market segmentation is very broad because all their products

are of need to most people so those people share a similar interest in product needs.

 Colgate uses a segmentation bases by knowing that certain groups of

people need Colgate toothpaste for a specific similar reason like yellow teeth, sensitive teeth or just teeth with cavities.

 Colgate also uses the family life cycle because they make toothpaste

that could be used for grownups and children.

 Also, toothbrushes are made to attract young children with cartoon

characters and different tastes and are less strong so that it wouldn’t damage their gums.

Positioning and creating Brand Equity

Consumer- more health and hygiene conscious Vast consumer base in India Sectoral opportunity in other oral products Smaller packs to drive growth Direct media promotions “Operation Jagruti” program

Educate villagers about oral hygiene Its benefits vis-à-vis traditional products like “Neem” Conducted by giving product trials and free samples

PEPSODENTCLOSE UP

Hindustan Unilever Limited

Hindustan Unilever Limited

In India since 1895Formed by merging3 subsidiaries of unilever

limited in 1956A $2.2billion companyIndia’s largest FMCG companyOver 20 distinct product categoriesMarket leader across categories

PRODUCT

Pepsodent has its products which cover a large areaTheir products arePepsodent Germicheck +Pepsodent WhiteningPepsodent 2 in 1Pepsodent GPepsodent Kids

PRICE

PRICE

TYPE PEPSODENT COMPETITORS

Vanilla variants – Pepsodent Germi-Check – Rs. 62 for 200g. 

Colgate Dental Cream–Rs. 65 for 200g

Gel variants- 

Pepsodent Center Fresh –Rs. 65 for 150g 

Colgate Max Fresh –Rs. 64 for 150g

Whitening variants – 

Pepsodent Whitening-Rs. 65 for 150g 

Colgate Max White-Rs. 65 for 150g

Gum care variants-  

Pepsodent G-Rs. 37 for 80g

Pepsodent Sensitive-Rs. 80 for 80g

 Colgate Sensitive-Rs. 80 for 80g Sensodyne- Rs. 80 for 80g Colgate Sensitive Pro-relief-Rs. 120 for 80g 

PLACE

PLACE

PRODUCT DISTRIBUTION CHANNEL

PROMOTION

Along with an offer of free dental check-ups, HUL is also planning to organise health camps involving villagers to fortify its campaign.

“To promote Pepsodent, we will also offer free samples to the villagers to try out the product and offer discount coupons on wrapper redemption schemes,”

Brand Ambassador In May,2010, Pepsodent had roped in Shah

Rukh Khan to be their Brand Ambassador.SRK had been roped in for pepsodents

latest campaign ‘Pappu & Papa’

Free GiftsPepsodent had

agreed to sell its Products with a toy along with the purchase of the product.

With phrases like “Collect Them All!”, the customers would want to buy more products in order to collect all the gifts.

Segmentation •Rural Areas•Urban Areas

Geographic

•Normal Use•Whitening•Complete Care

Behavioural

•Pepsodent G•Pepsodent Kids•Pepsodent Milk Teeth Strawberry

Demographic

TARGET MARKET SELECTION

Pepsodent is currently into Selective Specialization

Pepsodent Kids for kidsSmaller and cheaper variants for rural

marketsPepsodent complete for the educated urban

consumer

Positioning Matters

Pepsodent positioning:

Pepsodent was launched in 1993 by HUL to capture the market from Colgate.

It was launched in the platform of Germ fighting property.

Pepsodent have experimented with its positioning althrough its life.

Ad Campaigns to supplement this positioning: Lasting Protection for hours Germ Fighting Campaign Dental Insurance Dishum Dishum Bhoot Campaign

Dabur India Limited

• Established in 1884 : 125 Years of Trust & Excellence

• India’s leading FMCG Companies with Sales of Rs.52,832 million , Market

Capitalization of Rs.2,09,133million & Net profit of Rs.6,449million

• World’s largest Ayurvedic and Natural Health Care Company

• Consumer products categories like Hair Care, Oral Care, Health Care, Skin Care,

Home Care and Foods

• Distribution network, covering over 2.8 million retail outlets

• Available in over 60 countries across the globe

• 17 world class manufacturing plants catering to needs of diverse markets

• Dabur's overseas revenue today accounts for over 30% of the total turnover

Key Players: FMCG in Rs. million

Source: Dabur Corporate Profile August 2012 Market Cap. as of Aug 8,2012

Product Mix Width Strategy

Home Care Personal Care FoodsHome Care

Hair Care

Skin Care

Digestives

OTC and Ethical's

Oral Care

Health Supplement

22%

30%16%

26%

6%

International Sales (FY 12)

AfricaMiddle EastAsiaUSOthers

Source: Dabur Annual Report 2011-2012

12 Billion- Rupee BrandsDabur AmlaDabur ChyawanprashVatikaRealDabur Red Tooth pasteDabur Lal Dant ManjanBaboolHajmolaDabur HoneyGlucoseFemOdonil

DABUR HUL(Hindustan Uniliver Limited)

Colgate-Palmolive Ltd.P&G(Proctor &Gamble)

INDUSTRY COMPETITORS

PRODUCT PRICE PLACE OR DISTRIBUTION CHANNEL

PROMOTION

1.Dabur red toothpastea) 200 gmb) 100 gmc) 50 gmd) 20 gm

2.Dabur Meswake) 200 gmf) 300 gm

65 421712

75112

Manufacturer

Wholesaler

Retailer

Consumer

TV commercials Newspapers POP Display Wall Painting Video Vans

Four P’s of Dabur

3) Babool Tooth Pastea) 380 gmb) 190 gmc) 90 gmd) 50 gme) 30 gm

4) Promise 340 gm

6542201510

65

Manufacturer

Wholesaler

Agents

Retailers

TV commercials Newspapers POP Display Wall Painting Video Vans Sales Proportions

Four P’s of Dabur

Product line length strategy

Hair oil Shampoo Oral care Skin care Digestives

Dabur amla hair oil

Dabur vatika shampoo

Dabur red tooth paste

Gulabri skin care

Hajmola tablets

Vatika hair oil Babul mint-fresh gel

Dabur uveda Hajmola candy

Dabur Almond Babool tooth paste

Fem Range Hingoli

Promise toothpaste

Pudin Hara

Meswek Pudin Hara Lemon Fizz

Lal dant manjan Nature Care

Pricing Strategy : Dabur implented value based, cost based, compititor based pricing

stragies.

Value based:

pricing is done based on companies' image in the market.

Ex:chwanprash

Cost based:

pricing is done based on cost of production.

Ex: hajmola.

Competitor based:

pricing is done based on competitors.

Ex: vatika dandruff control shampoo.

 

Segmentation is done only on the basis of income of the consumers. So they have made sure to produce a product in different quantity and made it available to every customer. Under the new strategy, Dabur segmented its products into two - those operating in larger urban markets requiring exclusive category focused sales and those meant for smaller towns and rural markets requiring an integrated sales force.Dabur has a wide portfolio catering to all the categories – Masses value seeking premium.

Targeting: Dabur's latest move follows the company's recent rejig in 'route to market' strategy to utilise synergies across divisions, maximise reach and maintain cost.

Dabur plans to double its rural reach to have direct access to some 27,000 villages with more than 3,000 people this fiscal, in a bid to keep pace with market leader Hindustan Unilever.

Positioning

Youth Health conscious peopleSchool childrenMothersExisting old age groups

Dabur Herb’l Toothpaste positioned as a herbal alternative to other toothpaste brands.

Dabur International, one of the most trusted and recognized personal and healthcare brands in the world, has revealed that its Dabur Herb’l Toothpaste, a new range of oral care products specially formulated with herbs, has been positioned in the market as a healthier oral care alternative, as it does not contain chemicals that can cause harmful effects on the teeth such as dental fluorosis.

It has taken a strong head start in the Middle East market as it is specially formulated with trusted herbs that are actively used in the region for various health purposes.

FACTORS HIGH/MEDIUM/LOW IMPACT

JUSTIFICATION

Cultural factors High impact

As dabur company is based on “ayurvedic and natural” methods. Ayurvedic is basically from and Indians believe that method.

Social factors High impact

Dabur is having a history of 125 years. It’s a well known and old company in the society, and as company’s vision is to provide the well being of society.

F ACTORS INFLUENCING BUYING BEHAVIOUR

Personal factors High impact

Dabur products are categorized into oral care, hair care, skin care, health care, food, home care, which mainly concentrate on children, old age people, women’s teenagers etc. company is promoting it’s products through famous celebrities like amitab bachhan, dhoni,rani mukharjee etc.

Pschycological factors

Medium impact

Dabur is old, and well known company, mainly it is ayurvedic based.

Dabur is international company customer has trust on dabur company.

FY 08 FY 09 FY 10 FY 11 FY 120

1,000

2,000

3,000

4,000

5,000

6,000

2,361

2,805

3,391

4,077

5,283

Net Sales (In Rs. Crores)

Net Sales (In Rs. Crores)

Source: Dabur Annual Report 2011-2012

FY 08 FY 09 FY 10 FY 11 FY 120

100

200

300

400

500

600

700

333

391

501

569

645

Profit After Tax (In Rs. Crores)

Profit After Tax (In Rs. Crores)

Source: Dabur An-nual Report 2011-2012

Conclusion

Nature is the lifeline of Dabur company. Dabur works in active collaboration with nature to provide the best of ayurvedic ,herbal health and personal care products to its consumers.

They define their business in ways that provide societal, environmental, and economic benefits to the communities and Geographic’s where they operate.