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Can Oral Care Keep Up the Pace?

By: Irina Barbalova, Euromonitor International
Posted: February 2, 2009, from the February 2009 issue of GCI Magazine.

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Toothbrushes is another core part of the market, generating 27% of market value in 2007. The category grew by a 7% CAGR 2003–2007, outperforming the overall oral hygiene market. Product development in toothbrushes really seems to have reached an impasse. Even private label operators are offering battery-powered products as standard, and market growth has largely come from persuading users of manual products to trade up to electric ones, as well as trying to build consumer awareness of regular replacement.

Education Will Promote Rinse, Floss Growth

According to Euromonitor International, mouthwashes/dental rinses was the most dynamic part of the market over the review period, and is anticipated to grow at a 4% CAGR over the forecast period—making it, once again, the most dynamic category. Floss is forecast to be the second fastest growing category. Low usage rates in most markets, as well as professional recommendation for use of these products, could open up significant potential for both markets. Use of these products is standard in North America, but consumption rates are low in the rest of the world.

Value Development Restriction

In many of the global industry’s leading markets, persuading consumers to remain brand loyal and responsive to new products during a time of recession is the core difficulty marketers are currently faced with. Volume sales are always likely to remain solid, consumers won’t stop brushing their teeth, but there is likely to be an increase in response to private label products, higher price sensitivity resulting in discounters building market share and a rejection of those parts of the oral hygiene market of which consumers question function—such as home teeth-whitening kits or toothbrushes with added blades, spikes or ridges. Obviously, these trends characterize the more mature parts of the global market, but the relative immaturity of markets such as India or China means there is still opportunity for brand building. However, the market as a whole is still dominated by Western Europe and North America, and manufacturer responses to these problem areas need to address the growing threat of mass-market price pressure.

The key to sustained growth seems to be consumer education. This could drive consumption of floss and mouthwashes, for example, but brand owners are going to have a hard time keeping these markets to themselves and out of the hands of private label. It will also be expensive—marketing costs across the industry are already expensive—and marketers will have to shout ever louder in order to demonstrate their differences and build consumer share.

Irina Barbalova is Euromonitor International’s global cosmetics and toiletries research manager.