Indian Toothpaste Industry
Download Indian Toothpaste Industry...
Indian Toothpaste Industry Overview: The concept of toothpaste in India is relatively new. In ancient and medieval India oral hygiene was taken care of by homemade and ayurvedic products. However in the last few decades the toothpaste industry in India has shown impressive growth. The toothpaste market in India can be categorized into the powder and gel market. However the gel toothpaste market has beaten the latter hollow. Toothpaste usage in India is very low as compared to other countries. The potential for growth is immense in the urban toothpaste market. The usage of toothpaste in the Indian cities is about 190gms whereas in developed countries like USA and England the toothpaste usage is 375gms per person annually. Oral care in India has been greatly driven by innovation, retail availability, packaging and promotion. The Indian oral care market is presently estimated at Rs. 4200 Crores, of which toothpaste contributes the largest chunk, accounting for approximately 75% of the total market. The toothpaste market is estimated at Rs 3100 Crores and is expected to reach Rs 3,226 Crores by 2012.
Colgate, which has dominated the Indian toothpaste market for many years, continues to grow well ahead of market. Colgate enjoys a market share of 52% while its rivals Unilever & Dabur hold 24% and 9% respectively. In the medium term, it might however face new competition from Procter & Gamble (P&G) that is likely to enter the toothpaste category in India (speculated for many years now) via its Oral‐B (most likely) or Crest brands. P&G has done well in toothbrush segment and looks well placed to enter toothpaste as well.
Growth Factors: Most of us, after getting up in the morning, have been consciously or unconsciously reaching out for a tooth brush and a tube of toothpaste for many years now. Brushing is so much a part of our daily set of activities that it can now be considered a habit. It’s this habit that gives rise to the global oral care market presently estimated at US$12.6 billion. Currently nearly 97% of the population in developed countries uses at least one variety of toothpaste and 87% of this population, brushes twice daily. This gives marketers virtually no space to expand the market with new users in this region. In stark contrast, only 55% of the Indian population uses toothpaste and less than 15 percent of the Indian toothpaste users brush twice a day, only indicating that the market here remains largely untouched. Dental Caries or tooth decay is the primary problem as far as oral problems are concerned. Dental Caries are caused by bacterial processes on sugar or carbohydrates, in food left in the mouth after eating. As per data provided by FDI World Dental Federation, the dental caries reported per capita in India is about twice of that reported in Scandinavian countries, whereas the annual consumption of sugar by a person in India is half of that of someone in Sweden. This can be attributed to the fact that the per capita consumption of oral care products like toothpaste in India is a meagre 127 grams as compared to Europe, where it is over 300 grams. Surprisingly even the Chinese and Malaysian citizens consume much more toothpaste than their Indian counterparts, with their consumption levels estimated at 255 and 304 grams annually.
In India, oral care segment holds a substantial share in the overall cosmetic market. Oral care market offers huge potential as penetration and per capita consumption of oral care products is very low. However, rising per capita income and increasing awareness is driving demand of oral care products. Consumers have started switching to value-added toothpastes like gels, mouth washes, and teeth whitening products. On back of increasing awareness about oral hygiene, improving income, and high advertising expenditure by players, the Indian oral care market has shown stupendous growth. It is estimated that the Indian oral care market will register a strong CAGR of around 14% during 2011-2015. A serious challenge for the industry is the low dentist-population ratio, with just one dentist for 10,000 people in urban areas and about 0.25 million people in rural areas. There is an urgent need of more dental health practitioners with relevant qualifications and training. Government has taken
various initiatives like dental health camps to promote good oral care. Manufacturers have used advertising campaigns to promote higher consumption of toothpastes and toothbrushes.
Free dental checkups have raised awareness about dental infections and diseases, especially in suburban and rural parts. The Indian Oral Care market is derived by analyzing and studying its subsegments including: tooth paste, tooth powder, tooth brush, and mouth wash. In rural areas, consumers are switching from toothpowders to toothpastes. A key industry trend is the move towards natural products comprising of herbs, vitamins and minerals. In rural areas of India, the penetration of oral care products is just one third of that in urban areas. Here people predominantly clean their teeth with natural items like twigs of Neem tree, salt and ash. With steady growth of Indian Economy, the per capita income of India has increased from Rs 18,885 in 2002-03 to Rs 54,527 in FY’11, hence purchasing power of the Indian consumers is constantly increasing. After factoring in all these points, one can’t help but conclude that a tremendous opportunity lies in the oral care market of India.
Seasonality: Toothpaste Industry does not have intra-year cycles in sales. Toothpaste now considered as a necessity and it is to be used it at least twice a day.
Profits earned by Key Players: