High penetration rates, even in developing markets, have served to constrain growth of global oral hygiene sales in recent years, says Claire Briney of Euromonitor International.
This meant that the commodity status of toothpaste and manual toothbrushes, which account for the majority of value sales, has facilitated the expansion of private label ranges, driving down unit prices - a feature that has been particularly prevalent in key Western European markets, such as Germany and the UK.
Nonetheless, global oral hygiene has enjoyed a marked recovery of late, with sales increasing by almost 8 per cent last year, a considerable improvement on previous years. Euromonitor's research shows that growth was buoyed by the strong performance of key Western European markets, underpinned partially by the continuing strength of the euro currency against the US dollar.
Eastern Europe and Latin America have also been major contributors to growth, boosted by factors such as a growing awareness among consumers, extensive marketing campaigns and expanding product ranges from the major multinationals. Unit prices of locally-made toothpastes also increased, as manufacturers launched more expensive, value-added products onto the market.
Health and beauty benefits
For the big manufacturers in this mature and traditionally sluggish sector innovation has become the only way to get ahead, Briney says. This has resulted in increased categorisation across the various subsectors of oral care with multi-functional products combining toothpaste and mouthwash, vibrating floss, and on-the-go mouth-freshening strips.
Consumer expectations are high, but the profits are higher for the manufacturers that can provide the increasingly image conscious consumer with oral hygiene solutions that fight plaque, give fresh breath and, importantly, a brighter than white smile. Novel products featuring new uses have been flooding the market during 2003 and 2004 including fresh breath strips, and tooth whitening products. Such products have tapped into consumer concerns of appearance and are expected to drive sector growth in the medium term.
In June, Gillette successfully launch something completely different on the US market; Brush Ups, a new teeth wipes product, positioned as a totally new oral hygiene concept capable of removing up to 64 per cent of plaque that an ordinary toothbrush is capable of removing. The dry-toothbrush is designed for last minute, on-the-go situations when brushing with a toothbrush is not practical.
And now the innovative product looks set to sweep away the cobwebs in the stagnant UK toothbrush sector where the decline of manual toothbrushes is currently being offset by power toothbrush sales.
The teeth wipes have not yet been launched in any other country, but they have proved to be a success in the developed North American markets where Brush Ups were voted one of the Best Products of 2004 by Business Week. Euromonitor expects Gillette to target the most valuable developed markets such as Italy and Germany before rolling out the product to other countries and regions. The flexible on-the-go format of the teeth wipes is expected to open up an array of distribution channels that are currently not practical for other products in the sector, such as vending machines in clubs, bars, and transport terminals.
Speciality brands drive growth in mature toothpaste
Toothpaste constitutes by far the largest area of the global oral hygiene market, accounting for some 58 per cent of total value sales in 2004, the research shows. During the period 1997-2004 as a whole, growth was constrained by increased price competition and the switch from manual toothbrushes to newer battery-powered/electric versions. However, power toothbrushes were generally used with less toothpaste than alternative formats, because of their smaller heads.
While toothpaste is mature and considered increasingly mundane by consumers, the burgeoning popularity of specialised toothpastes, catering for different consumer groups and needs, continues to spur growth in developed markets.
In the Netherlands, for example, Euromonitor's research shows that whitening, sensitive, child-specific and all-in-one toothpastes, such as Colgate Total, emerged as the fastest growing products in 2003, as consumers looked for benefits beyond basic protection. In France meanwhile, Signal furthered its product segmentation by launching Signal Xperience, a product specifically for young adults between the ages of 18 and 25.
In the UK the growing demand for whitening and breath freshening products also resulted in many players extending their brands by such variants to their existing ranges. GlaxoSmithKline added whitening toothpaste to both its Macleans and Sensodyne line-ups. GSK took the opportunity to revamp its Macleans packaging in order to position the brand as a premium product. The packaging was redesigned from traditional white to a classy black and metallic shade to emphasis the new premium positioning Macleans has taken. Similarly, Procter & Gamble extended its Crest range and added Crest Revitalise, promoting it as beauty treatment paste emphasising on toning the gums and remineralising the enamel.
Manual toothbrushes fail to brush off the competition
Euromonitor International's research shows that manual toothbrushes grew by 7 per cent in value terms in 2004, with growth propelled by a shift towards more expensive, premium products, as manufacturers attempted to counter the pressure exerted by private label. Design innovations involved changing the size and flexibility of toothbrush heads to better access hard-to-reach crevices between teeth, as well as redesigning bristle configurations and texture to clean more effectively between teeth without damaging tooth enamel and gums. However, the growing popularity of electric/battery toothbrushes continued to hinder sales to some extent.
In the dominant US market, part of the problem for manual toothbrush sales has been their own product innovation, which has steadily driven up their prices in recent year, particularly on high-end brands. Americans, who possess a penchant for anything automated, have been especially quick to switch to battery-powered brushes once their price points came within only a few dollars of more expensive high-end manual toothbrushes.
In the UK, two important releases came from GlaxoSmithKline - Aquafresh Flex Extreme Clean Tooth & Tongue, a multipurpose toothbrush designed to clean the tongue too, and Sensodyne Total Care, designed especially for those with extra sensitive teeth. Both new manual toothbrushes are premium products aimed at increasing GSK's value sales. Another notable launch in 2004 was from Wisdom with its new Wisdom Click toothbrush whose head clicks away if when teeth are brushed too hard. Wisdom has experienced sales decline in the past few years and with its new launch hopes to revive the lost shares.
Euromonitor suggests that the stepping down of big brands into niche areas is evidence of the competition price deflation has caused in the mass segment. This, along with premium positioning and the continued promotion of oral care products as a significant part of health and beauty regime, should bode well for another bright year for oral hygiene.