Promotional Aspects Of

Promotional Aspects of

Toothpaste & its Effect on

Consumer Buying Behavior

Promotional Aspects of Toothpaste & its

Effect on Consumer Buying Behavior

FDDI, PGDRM (06-08) 2

Prepared for

Yagika Madan

Faculty Store Promotion,

FDDI, Noida

By

Krishna Kumar

PGDRM-01

Centre for Retail Management

Footwear Design & Development Institute

Noida.

17th Sep 2007


Acknowledgement

“Promotional aspect of Toothpaste & its effect on consumer buying behavior” is

one of the specific project to be worked on, as such it covers not only the marketing &

promotional aspects of toothpaste industry in India but its outstanding effect on consumer

perception & buying behavior.

I am very thankful to our respectful faculty Ms.Yagika Madan for assigning a

project, which is not only distinct but also covering diverse aspects which are affecting

the promotional policy of any store or company.

Going through this project was one of the wonderful experiences as such it has

overall enhanced my knowledge about the relevant area & its diverse aspects. Also

throughout this project several outstanding individuals were integrally involved and had

given there substantial contribution, for which I am very thankful to them for giving their

precious time in completing this major project.


Table of Contents Section Title Page No.

1. Executive summary 4-4

2. Oral Care 5-5

3. Indian Oral Care Market 6-8

4. Industry Overview 8-9

5. Toothpaste Market 9-10

6. Segments in the Industry 11-12

7. Key Player 12-15

8. Top 5 Brands 15-18

9. Category Media spends 19-19

10. Current Communication 20-20

11. SWOT Analysis of Colgate 21-23

12. Consumer Products 23-26

13. Objective 27-27

14. Methodology 27-28

• Population Definition

• The sample plan

• The sample size

• Development of the survey questionnaire

• Collecting the data

• The response rate

15. Data Analysis 29-45

16. Conclusion & Findings 46-46

17. Recommendations 47-47

18. Bibliography & references 48-48

19. Filled Questionnaire


Executive summary

To understand the consumer mindset is one of the most critical things for any

marketer. At the same time it is also most dynamic in nature. The prime objective of the

research was to understand the consumer behavior in respect to toothpaste.

The finding supports the research that Colgate is undisputable market

leader, behind them is HUL as market challenger. The overall impact of advertisements

and sales promotion is critical for any brand’s success and failure. The finding suggests

that T.V commercials are prime source of influence on consumer. About 50% of

consumers came in contact of more then one media.

It also came out that there is good amount of satisfaction among consumers for

their brand that leads towards brand loyalty.

Discount and offers are the key element of a brand, which attracts a consumer

towards it. In case of toothpaste the promotional offers by companies are mainly Extra

Qty. (46%), Price offs (26%), Free gifts (11%).

17% of customers fell they are not getting any kind of offer. So companies need

to come up with different new offers that can attract more and more customers.

There is increasing trend of awareness for oral hygiene.


Oral Care

The oral care market can be segregated into toothpaste (60%), toothpowder (23%) and

toothbrushes (17%). While 60% of toothpaste is sold on the family platform, around 35% is sold

on cosmetic propositions. On the other hand, while toothpowder accounts for 52% of the market,

red toothpowder accounts for 40% and black toothpowder accounts 8%. The penetration level of

toothpaste/powder in urban areas is 3X that in the rural areas. Traditional materials such as neem

and tobacco are popular for cleaning in the rural areas, Frequency of usage for toothpaste is only

1.5 times among other consumers, compared with 2 times in the developed world. Per capita

consumption of toothpaste is only 70 gm compared with 300 gm in Europe and 150 gm in

Thailand.

Given the low per capita consumption and penetration rates, toothpaste demand is mainly

being driven by the overall market growth of 8-10%. The rural segment is also driving

toothpowder growth.

Indian Oral Care Market • Many people in India still clean their teeth with traditional products like Neem

twigs, salt, ash, tobacco or other herbal ingredients.

• Average all India per capita consumption of toothpaste is a dismal 82gms.

• The dentist to population ratio is a critically low 1:35000 in the country. This

results in low oral hygiene consciousness and widespread dental diseases.

• Less than 15% of the Indian toothpaste users brush twice a day.

• The toothpaste market grew at a CAGR of 7-8% between 1995-2000. But in 2001

the market grew by only 4%.

• Colgate and Hindustan Lever together account for over 85% of the organized

toothpaste market.

• Red and Black toothpowder still accounts for 35% of the toothpowder market.

• In toothpowders, Colgate and Dabur are the leading players sharing between them

75% of the market.


• Penetration of toothpowder in the urban areas has been declining, as more and

more consumers switch from powders to paste.

• Brand loyalty is quite high for toothpastes, but is extremely low for toothbrushes.

• 10 years ago the most expensive toothbrush was priced at Rs4. Today one can

also buy a toothbrush priced at Rs999!

The Rs. 2,200-crore toothpaste market (the largest oral care segment), grew a

robust 10 per cent in value in 2000. But this wound down to 2.4 per cent in 2001. In the

first six months of 2002, the market for toothpastes in fact shrank by around 5.7 per cent

in value; in volumes terms it was much higher at 11 per cent. The going was tough for the

oral care industry.

Little wonder that teeth were bared between the market leader, Colgate Palmolive,

and the challenger, Hindustan Lever, as the marketing war between the two FMCG giants

for protecting market share got tough.

As if that was not enough, these players found new aggressive competition

coming their way from regional low priced competitors such as Anchor Healthcare &

Ajanta India, who priced their offerings at over 40% discount, giving market leaders a

run for their money.

These low priced competitors accounted for more than 80 per cent of the growing

‘discount segment’. It looked as if the multinational companies were helpless against

challenger brands.

But then the big boys struck back, Colgate revitalized one of its existing brands,

Cibaca as Colgate-Cibaca. It was to act as the price flanker brand in the portfolio. Ditto

by HLL with Aim. At prices similar to the low priced challenger brands it took the battle

right into their turf. The market dynamics changed. Within a year, Colgate Cibaca

managed to garner whopping 50% of the market share in the discount segment and

established Colgate’s supremacy once again. HLL’s Aim however could not match the

success and was subsequently withdrawn from the market.

Today not only has Colgate's flagship brand grown, but Colgate Cibaca has

risen to become the 4th largest paste brand in the country in volume terms after Colgate


Dental Cream, Pepsodent and Close-Up (in fact Colgate Cibaca is now #2 in some

geographies).

It is interesting to note that Colgate Cibaca became big without any intensive

communication support. It relied more on trade level activities and below the line

strategies for its success.

However the journey for brand Colgate Cibaca has just begun. Having come up

this far, Colgate now aims to move Colgate Cibaca to the next level of growth. Hence the

challenge is increase the share of Cibaca without cannibalizing mother brand Colgate.

1.Industry Overview

India is still a nascent country in dental hygiene, with the majority of the

population still not having access to modern dental care but relying on substances like

coal ash and neem sticks.

In India, per capita toothpaste consumption stood at 74g in 2005, which is

amongst the lowest in the world, compared to 350g and 300g in Malaysia and Vietnam

respectively

Toothpaste enjoys a countrywide penetration level of 50%. 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.

Table 1.1: Toothpaste Penetration

All India Urban Rural

Penetration 50% 75% 39% Source: NRS 2006


With the huge consumer base waiting to be tapped and the expected rise in

purchasing power as the economy picks up, oral hygiene in India may receive a fresh

lease of life .

2. The Toothpaste market Oral hygiene continues to be under aggressive competition, with sales increasing

by a modest 3% in current value terms in 2006 to Rs. 2,400 crs. Toothpaste accounted for

a whopping 83% of value sales.

Table 2.1: Toothpaste market in value (in Rs. crs.)

Period Urban+Rural Urban Rural Apr-Mar04 1897 1340 556 Apr-Mar05 1950 1386 565 Apr-Mar06 2009 1414 594

Table 2.2: Toothpaste market in volume (in tonnes) Period Urban+Rural Urban Rural

Apr-Mar04 77320 53791 23529

Apr-Mar05 84501 59172 25329

Apr-Mar06 86562 59922 26640 Source: AC Nielsen Market Information Digest India 2006


Table 2.3: Value - Zone Wise (in Rs.crs.)

North Zone East Zone

West Zone

South Zone

Apr-Mar06 486 335 543 645 % wise 24 17 27 32

Table 2.4: Value - Town Wise (in Rs.crs.)

Total market value Town class Metro Class 1 Others

Apr-Mar06 561 386 467

% wise 40 27 33

Source: AC Nielsen Market Information Digest India 2006

Long-term growth drivers

• Improving penetration

Through better distribution and conversion from other modes of oral care.

• Increased usage

Improved per capita consumption through increased usage frequency.

• Population growth

An annual 1.5% increase in population will help broaden the user base for oral

care.


3. Segments in the Industry Price-based segmentation of the toothpaste category

On the basis of price, the toothpaste market can be broken down into two distinct

categories:

The Regular segment:

Volume ( 64,922 tons )

Price range

The Low price point segment:

Volume ( 21,641 tons )

Price range :

50 gms Rs. 12.5-24 50 gms. Rs. 8-10

100 gms Rs. 25-30 100 gms Rs. 14-20 150 gms Rs. 35-45 150 gms Rs. 25

Prominent brands: Prominent brands: • Colgate • Pepsodent • Close-up • Meswak • Dabur Red

• Colgate Cibaca • Babool • Anchor • Ajanta

Source: B&K Report 2006– Colgate Pamolive India

Low Price Point Segment

The Lower Price Point segment accounts for around 25% of total category

volumes. This segment offers good value for money and has seen its volume market

share increase from 10.7% during 2000 to current levels. The entire category is

characterized by intense competition in both the price segments.


Threats from smaller brands in the low priced segment Small and regional brands from the low priced segment are expected to perform well

because they are often close to the market, respond faster to changes and are willing to

learn from mistakes.

Industry analysts believe that the new threat will come from smaller players who have

embraced a different kind of business model with a different value proposition. These

include regional brands and private labels.

Regional brands typically take on well-known, established brands by pursuing a flanking

strategy which can be of two types – geographical or need-based.

In a geographical attack, the challengers identify regions where the opponent is under

performing. The other flanking strategy is to serve unfulfilled market needs. The smaller

brands have also started delivering on the quality front.

4. Key Players

The toothpaste segment is largely a two player industry, Colgate Palmolive &

HLL accounting for 80% of the entire market

Table 4.1: Company Share (Value)

Colgate Palmolive HLL Dabur

Apr-Mar06 47.3% 30% 7.2%

Table 4.2: Company Share (Volume)

Colgate Palmolive HLL Dabur Apr-Mar06 48.8% 27% 9.1%



4.1: Colgate – the dominance continues

Colgate has been present in the domestic oral care market for the last 70 years and

its oral care brands enjoy strong brand equity in the market.

The company has traditionally been the leader in the domestic oral care market.

Currently, it occupies a dominant position in the toothpaste segment with a 48% market

share in the domestic market. Its relative market share is 1.5 times the second largest

player.

Colgate acquired Cibaca in 1994 from Ciba Geigy. The company today has two

main brands in the toothpaste segment – Colgate and Colgate Cibaca.

Faced with tough competition from HLL during early 2000, Colgate made a slew

of successful new launches to protect its market share namely Colgate Herbal, Colgate

Gel & revitalized Colgate Cibaca Top (in the low price segment).

The company has continuously relied on innovations to stay ahead of the

competition. It launched 3 new innovative variants during the course of FY06.

1. Colgate Active Salt – Which capitalises on the traditional use of salt for oral care

2. Colgate Advanced Whitening –Which contains microcrystals that polish ones

teeth, restores and maintains their whiteness.

3. Colgate MaxFresh Gel – An innovative gel-based toothpaste with cooling crystals

Current Brand portfolio: Toothpaste 1. Colgate Dental Cream

2. Colgate Total

3. Colgate Herbal

4. Colgate Kids Toothpaste

5. Colgate Advanced Whitening

6. Colgate Active Salt

7. Colgate Fresh Energy Gel


8. Colgate Max Fresh

9. Colgate Cibaca

Strong distribution The company has backed its products with a very strong distribution network. The

company's distribution network covers 940 direct accounts and 3.8 million retail outlets.

Colgate is the 2 nd most widely distributed product in the country. The company is tying

up with initiatives like E-Choupal and Disha to further strengthen its distribution

network.

Tremendous brand equity Over the years, Colgate has been able to develop strong brand equity. It has been

voted the “The Most Trusted Brand” in the country for 3 consecutive years in the AC

Nielsen Brand Equity Survey.

4.2: HLL – the challenger In the late 1980s, Hindustan Lever used the novelty element in gel toothpaste to

make steady inroads into Colgate's dominance in the oral care market. Its gel toothpaste,

Close-Up helped HLL become the second largest paste brand; posing a stiff challenge to

Colgate.

However as the novelty of gel toothpastes wore off, HLL renewed focus on its

other brand Pepsodent to help it protect its turf.

Its attempt at offering a low priced brand Aim was not completed and the brand was

subsequently pulled back after launching it in early 2000

Both Close Up and Pepsodent have a combined market share of 30%

The current brands offer distinct propositions; Close Up addresses the youth with new

benefits and value-driven propositions, whereas Pepsodent is firmly entrenched on the

family health platform with variants catering to oral health.


Table 4.2: Current Brand portfolio: HLL

Close Up Pepsodent

Close-up Active Gel (red) with

Vitamin Fluoride System

Close-up Lemon Mint

Close-up Milk Calcium

Pepsodent Gumcare

Pepsodent 2 in 1

Pepsodent Complete 10

Pepsodent Whitening

4.3: Dabur – Growth through acquisition

Dabur has managed to grab a 7.2% market share with the acquisition of Balsara's

oral care brands: Babool, Promise and Meswak in addition to its own brand Dabur Red

(targeted to capture consumers shifting from toothpowder to toothpaste).

5. Top 5 Brands

5.1 Colgate Dental Cream

Colgate Dental Cream is the most widely distributed oral care brand in India has a

market share of 34% in value terms. It was revitalized in 2003 with an improved germ

fighting formulation. Its anti-bacterial ingredient has been boosted to offer superior germ

fighting efficacy.

These improvements come in addition to its calcium and minerals formula that

helps repair weak spots on teeth and locks in additional calcium and essential minerals to

make teeth stronger than ever before.


5.2 Close-Up Active Gel

Launched in 1975, Close-up was the first gel toothpaste in India. It has since then

undergone periodic re launches.

In 2004, Close-up was re launched with a bang. And this time it was packed with

the power of Vitamin Fluoride System – a powerful mix of Vitamins, Fluoride,

Mouthwash and Micro whiteners, the perfect combination of ingredients for fresher

breath and stronger, whiter teeth. Close-up is now the first Gel toothpaste with Fluoride

in Indian Market. Current market share stands at 14%.

5.3 Pepsodent Complete 10

Pepsodent, the second offering from HLL with a market share of 11% was

launched in 1993 and was the first toothpaste with a unique anti-bacterial agent to address

the consumer need of checking germs even hours after brushing.

Pepsodent has always been regarded as a mother's oral health care ally and has

been associated with inculcating good dental habits amongst kids. Currently the brand is

championing night brushing habits amongst kids through its latest TV commercial. The

thrust is on making brushing at night a fun activity for kids. The brand plans to continue

with its initiatives to promote healthy brushing habits.

5.4 Colgate Cibaca Top

Colgate Cibaca Top is currently the fourth largest brand with 5.7% market share.

5.5 Colgate Fresh Energy Gel

The Company launched new Colgate Gel Toothpaste in 1991. Colgate Fresh

energy contains icy cool gel, which leads to mouth coolness, and minerals, which make

teeth stronger. It has a market share of 3%.


The Colgate Fresh Energy Gel advertising campaign launched in 2001 used an innovative

catch phrase – “Talk to Me” and used television, outdoor and online media to connect

with the youth. The company continued to build on its highly successful campaign and

re-launched it with a new flavour in a transparent tube, a first for the category in India.

Other brands

5.6 Anchor

Anchor belongs to Anchor Health and Beauty Care (AHBC), a part of the Anchor

Group (makers of Anchor Electrical switches).

Anchor forayed into the FMCG market with the launch of Anchor White

Toothpaste, which was positioned as India's first British Dental Health Society certified

100 per cent vegetarian toothpaste, in 1997. In fact this proposition had so strong a

consumer-pull that by 2002 it was the number three toothpaste brand.

In 2006, Anchor decided to directly compete with Colgate Dental Cream, thereby

differentiating itself from the LPP segment. It significantly upgraded its product bundle,

both in terms of superior formulation (almost parity to CDC) claims and by the

development of an All-round Protection sub brand. This is currently endorsed by Dravid

with strong TV support.

5.7 Babool

Babool originally a Balsara product was acquired by Dabur last year. Babool

straddles the economy and herbal platforms. Its natural toothpaste contains ayurvedic and

medicinal benefits of the Babul tree, 'Acacia Arabica'. While Babool still pursues an

aggressive promo strategy on all its SKUs, it has also upgraded its bundle ever since the

acquisition, by putting the Dabur brand on its pack and signing up Vivek Oberoi as a

brand ambassador.


5.8 Ajanta

Ajanta toothpaste is an offering from the personal care division of Ajanta Clock

Manufacturing Company.

With aggressive pricing as its USP, the company decided to do a Nirma in the

toothpaste Industry. Originally priced at one-third of a Colgate or a Pepsodent, Ajanta

rewrote the rules of the game for oral care products. It targeted its offering in the low

price, mass-market segment.

5.9 Colgate Cibaca Top

In the year 2000, Colgate revitalized Cibaca which was relaunched nationally in

the economy segment as 'All New Colgate-Cibaca Top. With the launch, Colgate entered

a new price band - the economy segment.

Salient features of Cibaca Toothpaste

• First economy toothpaste from Colgate

• Initiative to maintain leadership of the growing low price segment and capitalise

on equity of Colgate.

• Revitalized formulation for strong teeth and fresh breath

• Features Colgate logo on the pack and tube

5.10 Brand wise Market Share

Table 5.10.1: Brand Share (Value)

Brand Share %

Colgate Dental Cream

Pepsodent (all variants)

Close-up (all variants)

Cibaca Top

Colgate Fresh Energy Gel

Apr-Mar06 33.8 % 16.0% 11.0% 5.7 % 3.3 %


Table 5.10.2: Brand Share (Volume)

Brand Share %


Pepsodent (all variants)

Close-up (all variants)

Cibaca Top Anchor

Apr-Mar06 32.0 % 15.0% 8.5% 10.3 % 4.5 %


Cibaca's steady climb in market share

Despite relaunches by Anchor & Babool, Cibaca continues to strengthen its

dominance of the Low price point segment in 2006

Source: AC Nielsen Volume Share

Category Media Spends (in Rs. crs.)*

April-March '06


Pepsodent 10 Close-Up Active Gel

Colgate Advanced Whitening

Pepsodent Germi -Check

Total Spends 159 107 92 67 65

TV 157 107 92 67 65 Print 2 0 0 0 0

*(Unadjusted Media Spends)



Current Communication

Brand Tagline Proposition Colgate “Bhartiya dentists ki number

one pasand ."

Colgate is the expert ( the last word) on dental care and provides you with 12 hour protection safeguarding you against 12 common tooth problems

Pepsodent “Pepsodent, raat bhar ... dishum dishum ."

With Pepsodent on guard parents no longer have to worry because brushing with Pepsodent at night ensures protection of their children's teeth the whole night through

Close-Up "Vitamin floride system wala naya Close-Up."

Vitamin fluoride has three fold benefits- whitens yellow teeth, freshens your breath and makes your teeth strong

Meswak "Meswak toothpaste. Formula sirf Bharat ke paas hai."

Proud to use an Indian brand

Babool "Subah Babool ki to din tumhara ."

Babool's natural and sweet peppermint taste adds zest to your life and enables you to face life head-on

Anchor ”Naye zamaane ki nayi suraksha ."

Advanced formula that protects one teeth from germs and keeps them strong


SWOT analysis of Market Leader Colgate Pamolive India Ltd.

Colgate: A SWOT analysis

A name synonymous with the Indian oral care industry, Colgate, is the undisputed

market leader in toothpastes with over 45% share in the Rs 21 bn (90,000 TPA) oral care

segment. The company's parent has a presence in over 200 countries worldwide. In India,

Colgate ranks No.1 in top of the mind recall in many consumer surveys.

Background

Promoted by Colgate-Palmolive USA, the parent operates through its 51%

subsidiary and has a presence in India since last 50 years. The company's flagship

product, Colgate Dental Cream is the largest selling toothpaste in India, with an estimated

market share of over 30%. The company acquired Hindustan Ciba Geigy (Cibaca) in the

year 1994, which helped it increase its market share. The company also has a significant

marketshare in the toothbrush category. This and shaving brushes accounted for 10% of

its FY04 revenues.

The toothpaste segment can be divided into two broad categories: White's, which

accounts for a dominant share of the Indian oral care market. Gels are estimated to be

only about 15% plus of the market.

Colgate is considerably backward integrated. It has captive manufacturing facilities for

flavor and other ingredients, which yield significant cost savings. It has also set up a

world-class facility for manufacture of Di-calcium Phosphate, a key ingredient in

toothpaste.

The journey over the years?

(Rs m) FY00 FY01 FY02 FY03 FY04 CAGR 9mFY05Sales 10,896 11,769 11,609 9,474 9,392 -4% 7,242 Other Income 228.9 295 310 358 299 7% 217 Expenditure 10,231 10,801 10,544 8,170 7,928 -6% 5,995 EBDIT 665 968 1,065 1,304 1,464 22% 1,247 OPM % 6.1% 8.2% 9.2% 13.8% 15.6% ~ 17.2% Net profit after tax(loss) 518 625 698 887 1,080 20% 809


From the above table, we infer that although topline has shown a degrowth of 4%

on a compounded basis over the 5 year period, bottomline has grown at a good 20% rate

in the same period. The company has been able to curtail its expenditure, which went

down by 6% during the period under consideration. Operating margins have been

increasing YoY and in 9mFY05 touched a peak of 17%.

The key reason for a significant improvement in operating margins over the years

is the reduction of advertising expenditure (see chart).

The company has lost significant market share in toothpaste that had peaked at

65% in FY95, as compared to 45% plus today. Most of this has been lost to HLL and

smaller players like Dabur and Anchor.

The potential As per our estimates, 12.2% of the total world population lives in rural India.

Currently, only a small portion (about 15%-20%) of region has been tapped. Although,

expansion in rural areas requires huge investments, it is a market that cannot be

overlooked and has huge potential. To put things in perspective, the per capita

consumption of toothpaste in India is only 82 gms, as compared to 262 gms for Thailand,

376 gms for Mexico and 518 gms for USA (Source: Colgate, Equitymaster Research). In

India, urban per capita consumption is 153 gms whereas rural consumption is a mere 38

gms.

Competition

The company has been facing immense competition from organised as well as

unorganised players. HLL is the closet rival of Colgate with a share of 34% with its

Pepsodent and Close-up (gel where it has a lion's share) brands.

The latest entrant in the organised sector is LG that has ventured into the FMCG market

and launched premium consumer products across 8 categories including toothpastes,

shampoos, soaps, detergents, etc. Also, there has been speculation from sometime now

that P&G (its worldwide rival) would debut its billion-dollar-plus toothpaste brand Crest

in India. This could intensify competition in the segment.


Concerns

The Company has high reliance on a single category (Oral Care), which accounts

for 94% of its sales and 98% of its profits (FY04). A large part of the company's product

folio consists of premium products, which do not have a large potential market in India.

This is evident as new launches by the parent in India have been much lower than other

markets. In the last couple of years, the company's topline has stopped growing and in

order to achieve growth, Colgate cut prices of its products by an average 17% in April

2003 (Source: Company Annual Report). The company has been able to increase its

margins by continuously cutting advertising expenses, which cannot go below a certain

point, owing to its single product dependence.

Consumer Products Oral Care - Toothpaste

The two market leaders in the dental care products are Colgate and Hindustan

Lever. Colgate leads with a 54% share of the market. It is a climb down from 75% level

enjoyed by it a decade ago. Hindustan Lever has been able to introduce new products.

Colgate launched its Colgate Gel in 1989 and has a market share of 10%.

Colgate Palmolive’s net profit rose marginally by 3% in the first half of 1997-98

over that of the corresponding period of the preceding year. Net sales advanced by 11%

expanding from Rs 4583 million to Rs 5081 mn (against a total of Rs 9045 mn in 1996-

97). The increases were not so increasing as the company is accustomed to a much better

performance. It was also so because these results did not reflect higher spending on

promotion which impinged on profits.

Hindustan lever’s Close-up is trying hard to penetrate the market deeper. Close-up

is also in the market for a long time – full two decades – and has captured a 13% share of

market. HUL had launched Pepsodent in the same range but colgate feels secure. Colgate

produces also Pamolive range of toilet soaps and intends to go into the product in bigway.

It has done well with its Optima and Halo shampoo brands and has entered the household

surface care products segments with the dishpaste Axion.


The company is planning also to launch new products mainly in toothpaste

segmentand this will give it volume growth. In 1996 , the company launched Colgate

Fresh strip toothpaste. It plans to double its turn over by the year 2000.

Balsara Hygiene Products with its Babool toothpaste launched in 1987-88 was a

forerunner in Indainising the product-base with herbal inputs. By a concentrated media

effort at highlighting the ethnic virtues of Babool, the company has carved a share of

tenth of the market. During 1992-93, the company launched another toothpaste brand,

Promise exclusively targeted at kids. This enabled the company to garner a significant

share in the market dominated by MNCs- Colgate and Hindustan Unilever. Now Balsara

is part of Dabur India Ltd., Daburs are also trying their best to promote the brand.

Hindustan Ciba Geigy had created a sir in the toothpaste market in 1960s, 1970s

and good part of the 1980s with its Binaca toothpastes. The brand name was taken off

and transferred to Reckitt & Colman. With abnormal price rise experienced by th

company for raw materials, the toothpaste business did not remain profitable. The

company introduced Cibaca Gel in 1993-94 but not much activity is noticeable as far as

toothpaste business goes.

The company has, nevertheless, carved a niche for itself in the toot brushes

market having garnered a share of 31% by volume, ahead of 30% share by Colgate

pamolive. Jordan’s Regular and Magic Wonder Tip have in a short span of time captured

a significant chunk of tooth brushes market (17% by value and 20% by volume). Among

the Indian brands, Promise of Balsara has also remain active in the nearly Rs 900 mn

market for tooth brushes.


Demand: Past & Future

Year Rs bn 1990-91 5.80 1991-92 6.40 1992-93 7.00 1993-94 6.90 1994-95 9.10 1995-96 10.70 1996-97 11.50 1997-98 13.00 1998-99 15.00 1999-00 17.00 2000-01 19.50 2001-02 22.00 2006-07 40.00

Demand : Past & Future

5.8 6.4 7 6.9 9.1 10.711.5 13 15 17 19.5 22

40

05

1015202530354045

1990

-91

1991

-92

1992

-93

1993

-94

1994

-95

1995

-96

1996

-97

1997

-98

1998

-99

1999

-00

2000

-01

2001

-02

2006

-07

Year

Dem

and

in R

s bn


Market Segmentation

Segment Share (%) By Brands

Colgate : Dental 46 Gel 10

Cibaca 03 Close-up 18

Pepsodent 09 Promise 9.5 Babool 0.5

By Region North 25 East 21 West 21 South 33

By Rural-Urban Split Rural 40 Urban 60

Market Growth Rates

1990-91 – 1996-97 12.1% 1996-97 – 2001-02 13.9% 2001-02 – 2006-07 12.7%

Source- NCAER research Consumer Products 2006.


Objective of the study

The main objectives of the study are:

1. To assess current consumer sales promotion schemes in toothpaste market.

2. To study consumer perceptions regarding various schemes in this category and

responses toward them.

3. To find brand loyalty among Consumers.

4. To access market share of different brand.

Research design

Research design is purely and simply the framework plans for study that guides

the collection and analysis of data. There are three major types of research design, i.e.,

exploratory research design, descriptive research design and experimental research

design. This study is basically exploratory analysis type.

Exploratory research The idea gets deeper insight into sales promotion scenario in toilet soap market

and to get perceptions of consumers. In order to address above-mentioned objectives (I)

study of secondary sources was carried out from NCAER (II) structured questionnaire

was designed to seek consumer responses.

Descriptive research Analyzed the data, which was collected.

Methodology

There are different methodologies in a research study. A popular research

methodology has to be adopted for a study.


Target population The target population for the study of “Promotional aspects of toothpaste & its

effect on Consumer buying behavior” is - Consumers, from different economical &

demographical background, who are purchasing & using toilet soaps

Sampling

Sample unit

Consumers using Toothpaste

Sample plan The selection of the samples is done following the two sampling techniques,

which are:

- Simple random sampling

- Convenience sampling

Sample Location: NCR

Sample size: - Customers-200 (Both male & female)

Time: 15 August-15 September2007

Collection of data: -The data was collected from primary & secondary sources. A survey

was conducted through structured questionnaire. The study was done among consumers

who are using toothpaste and conducted personal interview for collecting the required

information. Secondary data was collected from NCAER as well as from FCB-ULKA

website.


Data Analysis Demographics of Sample

Gender

G e n d e r o f S a m p le

M a le53

F e m a le 4 7 M a le

F em a le

In total sample size of 197, there was 104 male (53%) and 93 female (47%). So

sample has a balanced contribution of male and female respondents.


Age

Age of Sample

15%

68%

6%

11%

0-2020-3030-4040-80

Due to time and manpower constraint the sample collection was done at college

campus and surrounding area. So most of the respondents lie in the age bracket of 20-30

yrs 134 (68%), further up to 20 years 30 (15%), 30-40 years 11 (6%), and above 40 years

22 (11%).

Age of the Sample

30

134

1122

020406080

100120140160

0-20 20-30 30-40 40-80

Age in Yrs.

No.


Education Background

Education Background

4

44

96

44

0

20

40

60

80

100

120

10th 12th Graduation PG& Above

Qualification

No. o

f res

pond

ents

Qualification

2%

23%

52%

23%

10th 12th GraduationPG & Above

The most of the respondents are quite educated as pie chart is showing 52% are

Graduate, 23% are Post Graduate or above, again 23% are Intermediate and only 2% are

10th pass.


Occupation

Occupation

2 6 12

160

80

20406080

100120140160180

Govt. S

ervic

e

Self E

mploye

d

Execu

tive

Studen

t

Others

Occupation

Num

ber

Occupation

1%3% 6%

86%

4%

Govt. ServiceSelf EmployedExecutiveStudentOthers

As already mentioned that sample collection was mainly one at college campus so

most of the respondents 86% are students, further breakup is visible in Pie chart.


Annual Family Income

Annual Family Income

2822

44

34 32

0

10

20

30

40

50

Rs 0-1 Rs 1-2 Rs 2-3 Rs 3-4 Rs 4 &Above

Rs in Lakh

No. o

f Res

pond

ents

Annual Income

18%

14%

27%

21%

20%

Rs 0-1Rs 1-2Rs 2-3Rs 3-4Rs 4 & Above

As it is very much well known that people are quite reluctant to tell their family

income so the figure above is not exact but the representative. There was lot of

respondents who did not fill this question.


Mode of Cleaning the Tooth

Mode of Cleaning the Tooth

174

165 2

0

50

100

150

200

Toothpaste Toothpowder Datun/Stick Others

Modes

No. o

f Res

pond

ents

Mode of Cleaning

88%

8%

3%

1%

ToothpasteToothpowderDatun/StickOthers

The finding says about 88% population in urban areas use toothpaste as mode of

clean the teeth in contrast to rural areas where things are quite different. There still people

rely on several other mediums. Here pie chart is showing that 8% people are using tooth

powder, 3% sticks and 1% other medium such as tobacco.


Brands People Use

Brand Preference

94

24 29

7 4 2 4 3 5 20

20

40

60

80

100

Colgate

Close-up

Pepso

dent

Meswak

Dabur R

edNeem

Vicco

Glister

Emoform

Seneq

el-f

Brands

No. o

f Res

pond

ents

54%

14%

17%

4%2%1%2%2% 3% 1%

ColgateClose-upPepsodentMeswakDabur-RedNeemViccoGlisterEmoformSenquel-F

Brand wise market is quite fragmented, the reasons are first there good amount of

small and big player in the market at the same time presence of hell number brands of

from a single company. But it is clear that Colgate is undisputed leader but HUL is not

far behind with its two major brands Close-up & Pepsodent.

Colgate includes all its sub brands like Gel, Total & other variants.


Frequency of Cleaning Teeth

Frequency of Cleaning

68

102

40

20

40

60

80

100

120

Once Twice Thrice

Frequency

No. o

f Res

pond

ents

Series1

Frequency of Cleaning

39%

59%

2%

OnceTwiceThrice

With the awareness campaign and people’s health conscious generation the

importance of oral hygiene is increasing among the population that is visible with about

59% brushes their tooth twice daily, 39% once and 2% thrice.


Place to Shop Toothpaste

Place to Shop Toothpaste

118

10

54

0

20

40

60

80

100

120

140

Neighbourhood Shop Medical Store Super Store

Store

No. o

f Res

pond

ents

Place to shop

65%5%

30%

Neighbourhood ShopMedical StoreSuper store

65% of people still rely to their local kirana shops for toothpaste, 30% purchase

from superstore and 5% from medical store. The 30% is showing growing craze of

organized retailing in India.


Average Consumption of Toothpaste

Monthly Consumption

8

96

68

0

20

40

60

80

100

120

50-100 100-200 More then 200

Weight in gms.

No. o

f Too

thpa

ste

Consumption Pattern

9%

53%

38%50-100 gms100-200 gmsMore then 200 gms

India has a very less per capita toothpaste consumption, the research is supporting

that also as in 53% families the approximate consumption is 100-200 gms, in 38%

families more then 200 gms, and in 9% families even less then 100 gms.


Duration for Using

Duration of Using

22 22 16

104

0

20

40

60

80

100

120

6 months 1 year 2 years More then 2yrs

Time

No.

of r

espo

nden

ts

Association with Brand

13%

13%

10%64%

6 months1 year2 yearsMore then 2 years

Major chunk of population 64% is associated with associated with same brand

from more then two years. 10% from about two years, 13% each from 6 months and 1

year. It shows that a good amount of population is brand loyal in terms of toothpaste.


Source of Information

Sorce of Information

136

14 12 16 4 10 12 80

20406080

100120140160

T.V

Ads

Print A

ds

Hoardi

ngs

Store D

isplay

Road S

hows

Salesm

an

Frien

ds/F

amily

Radio

Source

No.

of R

espo

nses

63%7%

6%

7%

2%

5%

6%4%

T.V AdsPrint AdsHoardingsStore DisplayRoad ShowsSalesmanFriends/FamilyRadio

How a consumer came to know about a particular brand it is very much important

for marketers, because with the help of this they can reach to their market in better way.

It is clear from the finding the T.V Advertisements are the major source of information

for customers; rest contributes marginally to the brand awareness.

About 50% of consumers came in contact of more then one media.


Attributes to opt a Brand

Attributes to Choose a Brand

3%

27%

27%

21%

6%

3%

4%

9%

Packaging

Fight againstTooth DecayFreshness

Whitening

Herbal Ingredients

Advertisment

Price

Taste

When it comes to why a customer opts for a brand, which attributes attract him

most? The opinion is divided into lot of factors, lot of customer prefer for more then one

attribute. But three core attribute on which the whole toothpaste market is standing are-

• Whitening-21%

• Freshness-27%

• Fight against tooth decay-27%

Interestingly 9% customers feel taste also as a choice criterion.


Satisfaction Level for Brand

S atis fac tio n le v e l

1 9

6 6

1 31 %1 %

Hig hly

S a tis fie d

M o d e ra tesa tis fied L ea st

Unsa tis fie d

The prime aspect that will decide brand loyalty is the satisfaction level of a

customer. Here 66% population is satisfied with their existing brand. The numbers of

unsatisfied customers are marginally less 1%.


Discounts & Offers with Brand

Discount & Offers

26%

11%

46%

17%

Price offFree GiftsExtra Qty.No offers

Discount and offers are the key element of a brand, which attracts a consumer

towards it. In case of toothpaste the promotional offers by companies are mainly Extra

Qty. (46%), Price offs (26%), Free gifts (11%).

17% of customers fell they are not getting any kind of offer.


Recommendation

Recommendation

85%

15%

YesNo

Word of mouth promotion has a deciding impact on consumers. Here finding

shows that companies are successful in this as 85% of consumer recommend the brand to

others.


Continuation With same Brand

Brand loyalty

72%

2%

26%

YesNoCant' Say

The consumers thinking regarding will they will be continue with the same brand

in near future the response is in favor of companies as 72% people are ready to continue

with their existing brand.

26% people are susceptible to brand switching as they are not convinced. Only 2% are

not comfortable with the brand they are using.

The additional Attributes/Offers people want in their brand

The response was not too much positive. Most of the people felt every thing is O.K or

nothing. Few suggestions I got are-

• More offers

• More freshness

• Herbal ingredients

• Good packaging etc.


Conclusion The over all conclusion derived from this study is that the toothpaste

industry enjoys a very good & strong position in Indian market, as such toothpaste is one

of most demanded & necessary goods of day to day use without which urban Indians will

find it really difficult to clean their tooth. Rural people can survive without it, but when

comes the oral hygiene use of toothpaste is advisable by doctors also.

Every section of the society whether it is middle, upper middle or

higher segment uses toothpaste especially in urban areas. Basically as per the research it

is found that the major section of the youth population uses one or the other toothpaste in

which freshness, protection against tooth decay and whitening is major attributes for him.

Mid quality toothpaste has major market share in urban areas. Some medicinal toothpaste

Like Emoform, Senequel-F etc are also attracting customers. At the same time herbal

paste as well as brand sold through direct marketing like RCM, Glister etc also

penetrating the market.

The major aspect of consumer buying behavior in terms of promotional

benefits which came into being after this research is that if the consumers are satisfied

with the quality & other major aspects of the respective commodity, some small benefits

or schemes are not going to distract them with their Brand loyalty. As such in this study it

is found that although consumers are not satisfied & not having proper knowledge about

various promotional schemes of their toothpaste, but still they are satisfied, want to

continue & recommend the same brand to others too.

This over all study reveals the fact that it is the functionality in terms of

efficiency & effectiveness of the product which overall affects the consumer purchase

decision-making brand promotion, advertisements celebrity endorsement only can not

attract a consumer. So the marketer should use more effective tools to communicate the

same to its target customers apart from attracting for additional benefits & offers.


Recommendation The emerging youth population is an opportunity for marketers.

As India has one of the least per capita Toothpaste consumption companies has to

work on this. The all players if come under one umbrella and promote the functional

benefits of toothpaste to consumers as well as that we should clean our tooth at least

twice.

Companies should analyze their strategy, as 17% of population is not aware about

the promotion and offers.

They should also work upon their promotional offers, as lots of customers were

not satisfied with the additional benefits.


Bibliography

www.equitymaster.com www.fcbulkacomstrat.com www.ibef.org www.ncaer.in www.indomainmba.com Consumer products: Report, NCAER 2006.

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