MARKETING STRATEGY ANALYSIS OF COMPETITORS IN INDIAN TOOTHPASTE INDUSTRY COLGATE Vs PEPSODENT
Backgroun
In terms of in dental hygiene, India is still a nascent country, with majority of the popu popula lati tion on stil stilll not not havi having ng acce access ss to mode modern rn dent dental al care care and and is still still rely relyin ing g on substances like coal ash and neem sticks. Traditional materials like neem and tobacco are popular for cleaning teeth in the rural areas. The oral care industry in India is worth Rs. 5,4 !r annually " comprises of Toothpastes #$%&, Tooth powder #'(%& and Toothbrushes #)*%&. !urrently, toothpaste enjoys a country wide penetration level of 55 %, with only )5 % of them brush twice a day. The per capita consumption in India stands at )'*gms+year one of the lowest in the world.
-iven the low per capita consumption and penetration rates, toothpaste demand is mainly being driven by the overall market growth of ) %. The penetration levels of dentifrice in the country have been on an upward trend over the last few years driven by strong improvements in toothpaste penetration. The toothpaste segment in India is larg largely ely a two two play player er indu indust stry ry,, !olg !olgat ate e " /ind /indus usta tan n 0nile 0nileve verr #1ep #1epso sode dent nt&& whic which h account for almost *$% of the entire market.
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2lmost one third of the Indian population does not have access to any of the modern oral healthcare facilities, making it a lucrative prospect market for the leading players. 3ith the per capita consumption of toothpaste in India at about )4$g, it is the lowest in the world. urthermore, toothpaste industry analysis revealed that dental cavities and other problems are prevalent in $(% of )5 year olds, while approimately % of adults in the age groups of (5644 suffer from the same problems. 7oreover, a study of the demographics also shows that the Indian population suffers etensively from gum problems, especially periodontal diseases and other tooth sensitivity issues. The data analy8ed predicts that the Indian toothpaste market can grow by 9% if the per capita consumption of toothpaste were to match that of !hina. -rowth has already been recorded in sub segments like mouthwash and toothpastes that addresses sensitivity problems, citing which market eperts are speculating growth of the segment as a whole. Mark$" !r$#c"#ons
3ith the oral care segment poised to grow substantially, the toothpaste market si8e in India is also likely to improve as more and more people upgrade from tooth powder or local remedial solutions to toothpastes. urther driving growth will be the initiative being spread among consumers pushing them to brush twice a day as opposed to only once. This means that toothpaste sales volumes will continue to grow as people also upgrade from the basic to the premium products. Br#$' O($r(#$) o' "%$ Brans
!olgate61almolive is a :)(. billion global company serving people in more than ' countries and territories with consumer products that make lives healthier and more enjoyable. !olgate focuses on strong global brands in its core businesses ; uid soaps, deodorants+antiperspirants, dishwashing detergents, household cleaners, fabric conditioners and specialty pet food. The main toothpaste products by the brand are as indicated below? Co*ga"$+
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!olgate @ental !ream !olgate Total )' !olgate Aensitive !olgate 7a resh !olgate Bids Toothpaste !olgate resh Cnergy -el !olgate /erbal !olgate !ibaca amily 1rotection !olgate 2dvanced 3hitening !olgate 2ctive Aalt !olgate 3hitening
P$!so$n". 1epsodent was a very popular brand before the mid D5s, but its makers
were slow to add fluoride to its formula to counter the rise of other highly promoted brands such as !rest and -leem toothpaste by 1rocter " -amble, and !olgateDs eponymous product sales of 1epsodent plummeted. Today 1epsodent is a Evalue brandF marketed primarily in discount stores and retails for roughly half the price of similarly6si8ed tubes of !rest or of !olgate. 1epsodent is sold as a 0nilever property in India, Indonesia, !hile, inland, and several other countries. The main toothpaste products by the brand are as indicated below? • • • • • • • •
!omplete G -um !are !omplete )' 1epsodent /erbal 1epsodent 1epsodent 7ilk Teeth
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!olgate61almolive informs its customers about its new products as well as the product that is being used by the customers. !olgate61almolive persuades and convinces its new as well as old customers to purchase its new product. 2dopting a good promotional strategy !olgate has succeeded to retain its customers and image. Co*ga"$+
Jy this !olgate strongly focuses on different promotional strategies i.e. mass selling, advertising, publicity and sale promotion etc. !olgate61almolive has proved itself as a keen observer of the market and the culture all around itself. The brand is targeting the young kids through effective promotion campaigns. !olgate6 1almolive is promoting kids products by labeling the cartoon Characters like Looney tunes, Barbie, Barney and many more which are being loved by the children. It also educating !hildren by a slogan EStronger say bhe Strong, Mera ColgateF. !olgate61almolive has list of products targeting this segment such as? • • • • • •
Oral health for children. Toothastes. Toothbrushes. !reat "lavor. !ames. Track for Brushing.
Jy adopting a strong promotion through the media such as TK, radio, newspaper etc, the brand is able to capture the mass market, making it a product of mass selling. Jesides the traditional advertising media for its 1romotion, it is using the electronic advertising media such as internet, facebook etc to ensure a faster reach to the targeted customers. !olgate also promotes its product through sales 1romotion to attract its customers. P$!so$n"+ 1epsodent packs included a -erm Indicator in ebruary67ay '',
which allowed consumers to see the efficacy in fighting germs for themselves. 2s a follow6up, in
one million dentists globally. This uni>ue partnership aims to increase oral health education and promotion in countries in both the developed and developing world. The 1epsodent6@I collaboration, established in '5, now operates 4' projects in ( countries. The new partnership in India will build on eisting programmes that 1epsodent and the I@2 have been running in schools targeting behaviour change amongst children. -oing forward, the programme will focus on increasing awareness of good oral habits and concentrate on the importance of twice daily brushing, and particularly night brushing amongst children. The
The !1IH is the market leader in the Indian oral care market with a market share of 5) per cent in the toothpaste segment, 4 per cent in toothpowder segment and ( per cent in the toothbrush segment. The !ompany has reported =et Aales for nine months ended at Rs. )'(9.4 crores, an increase of )5% over the same period of the previous year. =et profit for nine months period stood at Rs. ')(.' crores, an increase of ')% over net profit recorded in same period of the previous year. Co*ga"$+
The growth of )4% achieved over the same >uarter of the previous year has been led by a steady )4% volume growth in the toothpaste category, with the !ompany maintaining its leadership position at 49.$% market share. 7ajor brands such as E!olgate @ental !reamF, E2ctive AaltF, and E!ibacaF continue to contribute to this consistent growth. The Toothbrush category market share saw an increase of '.% taking !olgateLs share to (% during Man@ec. In the Toothpowder category, the !ompanyLs market share has also increased by '.9% to 4.9% . The !ompany continues its thrust in spreading oral health awareness and good oral hygiene practices through various programs conducted across the country, mainly targeting consumption building in rural areas. The !ompany observed ue EHittle @entistF program covered ).5 lakh children from )9 schools across * cities. P$!so$n"+ 1epsodent, /industan Hever Htd s leading oral care brand, announced
the launch of 1epsodent @ental Insurance, a first of its kind initiative in the oral care category in India. 0ndertaken through a partnership with the =ew India 2ssurance, India s largest -eneral Insurance !ompany, 1epsodent now offers its consumers free dental insurance of Rs. )+6 on purchase of any pack of 1epsodent. 0nder this initiative 1epsodent offers its consumers insurance cover against epenses for the etraction of a permanent tooth or teeth due to severe !aries and 1eriodontitis including cost of medication in relation there to. !aries and 1eriodontitis are two of the most widespread dental ailments in India. 2nnouncing the launch of 1epsodent @ental
Insurance 1radeep Janerjee, !ategory /ead 6 ue concept and first of its kind in the ue concept in this category and will further strengthen the e>uity of 1epsodent in the minds of the consumersF. Insurance cover under 1epsodent @ental Insurance will be provided for one year, which comes into effect after a period of si months from the date of issue of the 1epsodent @ental Insurance !ertificate. 1epsodent @ental Insurance forms will be soon available in all Auperior 1epsodent packs of ) and ' gms as well as select retail outlets. The company also plans to make the forms available through advertising in the print media starting =ovember. 1epsodent has steadily gained market share from )$.4 % last year to )*.( % in 2ug '. /HH
The packaging and labels can be used by marketers to encourage potential buyers to purchase the product. 1ackage design has been an important and constantly evolving phenomenon for do8ens of years. !olgate uses attractive packaging which visible it from competitorLs brand. They have used following colours? Co*ga"$+
3hite 6 !lassic color, 2ccurate background, Aophistication " agility of company, =atural colour Red 6 Atrength, energy, love, ecitement, leadership, power, 2ctive, eciting, good luck, Poung -eneration. Jlue 6 Research process, !almness and peace, Innovation, reshness Pellow 6 Aunlight, joy, happiness, wealth #gold&, hope . -reen 6 =ature, spring, fertility, youth, environment, wealth, money #0A&, good luck, vigor, generosity, go, grass , -reen also symboli8es go because of its use in traffic signal !olgate also focuses mainly on the following factors at the time of packaging? Reducing the Cnvironmental Impact of 1ackaging? !olgate is always looking for ways to minimi8e the impact of its packaging on the environment, and has been an industry leader in the continuous use of a type of post6consumer recycled plastic known as 1CT.
-lobal sustainability packaging strategy focuses on the 4 Rs? •
Reduce the weight of the packaging where feasible
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Remove secondary and tertiary packaging where possible
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Recycle ; increase the use of recycled materials and convert to more recycling6friendly materials Reuse+Refill ; design packages to be reusable and focus on refill package development
-uidelines have been developed to help the packaging designers and engineers to create more sustainable packaging starting from the concept stage. packaging teams publish monthly internal 1ackaging Austainability =ewsletters to share best practices, news and market trends from around the world Reducing 7aterial in Toothpaste Tubes !olgate continues its effort to reduce the amount of material in its toothpaste tubes while maintaining the re>uired dispensing performance, toothpaste >uality and packaging integrity. rom ' to ', the packaging reductions resulted in over (% reduction in consumption of energy and natural resources. !olgateDs progress in this area was recogni8ed as a OAustainability Auccess AtoryO by a major retail customer. or eample, in Hatin 2merica? The tube weight reduction resulted in ),)5 metric tons of savings in '$ and '*. The cap weights were reduced in ', resulting in an annual savings of 4 metric tons of plastic. 2t !olgate, sustainability is a critical criterion for any new package design and development. Through our core value of continuous improvement, we constantly search for ways to minimi8e the environmental impact of product packaging. P$!so$n"+ Their approach towards responsible packaging seeks to take into
account environmental, social and economic considerations. In '* the company created a Austainable 1ackaging Ateering Team to define a strategy. This team is building on the work already carried out over the past few years by the 0nilever 1ackaging -roup. 2chieving truly sustainable packaging is a comple challenge. Aome energy is always re>uired to make packaging and some waste is inevitable even with highly effective reuse and recycling schemes. The approach is based on three elements? •
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!onsideration of the whole product, not just packaging in isolation 2ssessment via our new vitality metric, which covers the waste generated taking into account all the different kinds of packaging a product re>uires. It also takes into account an estimate of the recycling, reuse and recovery rates of the materials as used in a particular region
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0se of leading6edge design techni>ues and choice of materials to minimise impacts.
-uiding principles 0nderlying this strategy are five guiding principles that they seek to apply? remove, reduce, reuse, renew and recycle. Austainable 1ackaging Ateering Team implements this approach across 0nilever. 7ore on the five guiding principles? #4R& Remove? to eliminate, where possible, unnecessary layers of packaging such as outer cartons and shrink6wrap film. Reduce? to reduce the material we use in our packages and ensure they are the optimal si8e and weight for their contents. Reuse? to reuse packaging from the materials we receive at our factories. Renew? to maimise the proportion of packaging from recycled and renewable resources and to investigate the technical feasibility of biodegradable and compostable materials Recycle? to increase the use of recyclable and single6material components in packaging for easy sorting and recycling at the end of its use. Q Cnhancing design Innovative packaging design can minimise the environmental impact of packaging itself. Jut it can also enhance a productDs lifecycle impacts. or eample, effective packaging can reduce product leakage and conse>uent waste during transportation. Q Austainable paper sourcing 2 significant proportion of packaging relies on paper. They estimate that most of the paper purchased for Curopean business comes either from recycled material or sustainably managed forests. 3hile this is an encouraging picture for Curope, the situation in other regions can be very different as sustainable forestry practices differ greatly. The company is working with the Rainforest 2lliance to develop a sustainable sourcing policy for paper. Q Hitter in the developing world 2 particular concern is the volume of sachets we use to package single6use products, especially in developing and emerging markets. These may end up as litter where there are no appropriate disposal facilities. The approach is to? implement design improvements to create sachets that use less material or material with less environmental impact support litter awareness programmes work with others to eplore economic models which create incentives for collection and reuse of our packaging.
3orking with others Cffective solutions re>uire a partnership approach. 0nilever is a founding member of the Austainable 1ackaging !oalition, which has over )$ members, including packaging producers, users and retailers. 3e are also members of C0R<1C= #the Curopean
The toothpaste industry is going to be more competitive in the near future. The profit margin is going down over the year and going to be continuing for the future also. Ao the main mantra for the companies to be successful is to satisfy the consumers and develop brand image and brand loyalty amongst them. Ao it has become very necessary for the consumers to understand the Indian consumers very well. Ao in the future the companies who come up with new products at competitive prices and with good >uality are going to the successful one. 1romotional activities are also going to play an important role that should to be for both retailers and consumers. Ao we are going to see a market which is going to heat up in the near future where mainly two major players !olgate and /HH will fight the war.
