Nielsen Featured Insights - Say It With a Smile - What It Takes to Win in the Global Oral Hygiene Market

FEATURED INSIGHTS DELIVERING CONSUMER CLARITY 

SAY IT WI TH A SMILE WHAT IT TAKES TO SUCCEED IN THE GLOBAL ORAL HYGIENE MARKET

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Study conducted on 191 innovations spanning price points in 20 developing and developed countries to draw up a blueprint for success in oral hygiene.

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Results show that the overall base success rate for toothpaste concepts globally is 50%.

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Propositions addressing mothers, highlighting essential benefits, demonstrating strong reason to believe and showing family and product visuals yield the highest potential success rates.

FACTS TO CHEW ON Oral hygiene, which primarily comprises toothpastes, toothbrushes and mouthwashes, is one of the categories with the highest reach in the personal care sector. And within oral hygiene, the toothpaste category is the largest and fastest growing, with a share of more than 55% of consumers around the world. Compared to the global oral hygiene market, which is expected to grow at 3% compounded annual growth rate (CAGR) in the next three to four years, India’s market is expected to grow at 14% CAGR. This represents a huge opportunity for players in India’s toothpaste toothpaste segment, which accounts for over 70% of the oral hygiene category. Trying to capitalise on this lucrative market, brands launch and test a large number of new and innovative concepts every year. However, the global overall base success rate* for toothpastes is just 50%.

* Based on Nielsen Innovation Practice (formerly BASES) database of ‘Factors for Success.’ In this context, ‘success’ is defined as any new launch which has a growing or stable distribution for two consecutive years from the date of product launch.

Copyright © 2014 The Nielsen Company

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To help companies better understand the oral hygiene market globally, Nielsen’s Innovation Practice compiled a list of 191 new toothpaste concepts tested globally between July 2010 and June 2013 across 20 markets and spanning a wide price range. The study was carried out to identify and highlight communication elements that occur more of ten among successful innovations. MARKETS

PRICING

(Total 191 concepts)

(Total 191 concepts)

48%

40%

52%

60%

DEVELOPING MARKETS

PREMIUM

DEVELOPED MARKETS

PARITY 

Developing Markets- Brazil, China, Costa Rica, India, Indonesia, Mexico, Nigeria, Pakistan, Russian Federation, Sri Lanka, Vietnam Developed Markets- France, Germany, Italy, Malaysia, Saudi Arabia, South Africa, Taiwan, U.K., U.S. Source: Nielsen

Success rates for new concepts differ by markets and pricing. Developing markets display a higher success rate than their developed counterparts, which is not surprising since it is more difficult to achieve break through success in a more mature market. Meanwhile, economically priced products show a greater chance of succeeding than premium.

50% SUCCESSFUL SEGMENTS

191  CONCEPTS

TOTAL CONCEPTS

% SUCCESSFUL

Developing Markets

100

60%

Developed Markets

91

38%

Parity Initiatives

77

60%

Premium Initiatives

114%

43%

50% UNSUCCESSFUL Source: Nielsen

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FEATURED INSIGHTS | WINNING IN THE GLOBAL ORAL HYGIENE MARKET

WHAT MAKES FOR A WINNIN G PROPOSITION? We’ve found that the success or failure of new concepts can largely be attributed to four critical factors that make or break the perception of a new concept in the eyes of consumers. These include:

CONTEXT SETTING

BENEFITS

REASONS TO BELIEVE �RTB�

VISUALS

SETTING THE RIGHT CONTEXT Based on our research, most successful concepts use either an emotional proposition like confidence or popularity or a functional one like protection or oral health and hygiene. Contrary to popular belief that functional promises to work better with consumers, the numbers tell a different story. Our study shows that emotional and functional propositions have equal rates of success when it comes to oral hygiene. Of all the concepts tested, 50% of concepts with functional propositions saw success and the exact same percentage of concepts with emotional propositions proved successful. While emotional and f unctional propositions work equally well overall, differences emerge at a market level. Our observation is that f unctional propositions work better in developing markets and emotional ones saw greater success in developed markets. Similarly, functional propositions work better with parity-priced initiatives whereas emotional propositions works in tandem with premium initiatives. THE WINNING PROPOSITION

EMOTIONAL OR FUNCTIONAL � MARKET SPECIFIC TRENDS CATEGORIES

Number of  % Concepts Successful

Developing Markets

94

62%

Emotional

28

Functional

CATEGORIES

Base Success Rate

Number of  % Concepts Successful

Parity Initiatives

73

62%

54%

Emotional

11

45%

66

65%

Functional

62

65%

Developed Markets

84

40%

Premium Initiatives

105

45%

Emotional

19

53%

Emotional

36

56%

Functional

65

37%

Functional

69

39%

Base Success Rate

Base Success Rate

Base Success Rate

 *Base Success Rate: % of successful initiatives out of the total initiatives tested which have either emotional or functional proposition and for parity and premium initiatives Source: Nielsen

Copyright © 2014 The Nielsen Company

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IN TERMS OF SET TING THE CONTEXT, EMOTIONAL AND FUNCTIONAL PROPOSITIONS WORK EQUA LLY WELL.

Concepts that talk directly to mothers  had a higher level of success as compared to the rest. Of the total initiatives that have insights addressing mothers, 63% proved successful. However, talking ‘to her’ or talking ‘as her’ did not seem to make a difference in overall success. Comparatively, only 46% of insights addressing individuals have gone on to be successful.

 WHOM SHOUL D I TALK TO?

CATEGORIES

Number of  % Concepts Successful

Total Concepts

183

51%

Addressing individuals

134

46%

Mother oriented insight

49

63%

Base Success Rate

*Base Success Rate: % of successful initiatives out of the total initiatives which have insights addressing either individuals or mothers Source: Nielsen

PROPOSIT IONS THAT TALK DIRECT LY TO MOTHERS HAVE A HIGHER SUCCESS RATE AS COMPARED TO INSIGHTS ADDRESSING INDIVIDUALS.

While addressing mothers may contribute to success, the content or message remains equally important. In our study, propositions that addressed mothers with a message inducing fear or highlighting a problem, such as “Do you know that poor eating habits can hasten cavity formation in children?,” had a high success rate of 71%. When propositions addressed mothers and focused on a need or desire, however, the success rate fell to 50%. Also, mother-oriented propositions when framed as questions, seem to substantially increase chances of success.

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FEATURED INSIGHTS | WINNING IN THE GLOBAL ORAL HYGIENE MARKET

MOTHER ORIENTED INSIGHTS

CATEGORIES

Number of  % Concepts Successful

Total Concepts

31

65%

Insights addressing mothers and expressing problem/ inducing fear

21

71%

Insights addressing mothers and expressing need/ desire

10

50%

Base Success Rate

*Base Success Rate: % of successful initiatives out of the total initiatives which have insights addressing mothers and are either expressing problem/inducing fear or expressing need/desire Source: Nielsen

INSIGHTS DIRECTED TOWARD MOTHERS EXPRESSING A PROBLEM OR I NDUCING FEAR HAVE A SUBSTANTIALLY HIGHER SUCCESS RATE COMPARED WITH THOSE EMPHASIZING A NEED OR DESIRE.

BENEFITS THAT TICK Consumers have come to expect some essential benefits from oral hygiene products, like cleaning, germ killing, cavity protection, strengthening, etc. Then, there are advanced benefits like gum care, sensitivity, whitening, etc. Concepts with essential care benefits seem to have a higher rate of success than those with advanced care. However, there are some caveats. Essential care benefits that are priced at a premium do not seem to work well in the market. We also see that advanced care benefits work better if combined with essential care benefits, especially when designed for developing markets and premium initiatives. Premium propositions have to work harder to succeed, irrespective of market characteristics. •

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Copyright © 2014 The Nielsen Company

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“CONCEPTS WITH ESSENTIAL CARE BENEFITS SEEM TO HAVE A HIGHER R ATE OF SUCCESS THAN THOSE WITH ADVANCED CARE. HOWEVER, ESSENTIAL CARE BENEFITS THAT ARE PRICED AT A PREMIUM DO NOT SEEM TO WORK WELL.”

ESSENTIAL VS ADVANCED BENEFITS

92

TOTAL CONCEPTS

50%

57% 49

Base Success Rate

TOTAL CONCEPTS �ESSENTIAL�

42% 43

ESSENTIAL

49 57%

37% 19

ADVANCED

70% 30

PREMIUM

NUMBER OF CONCEPTS

Base Success Rate

PARITY

% SUCCESSFUL

*Base Success Rate- % of successful initiatives out of the total initiatives which have either essential care or advance care benefits

SHOULD WE COMBINE ESSENTIAL AND ADVANCED CARE BENEFITS FOR BETTER SUCCESS?

39% 59

GUM CARE

59% 17

24% 21

GUM CARE AND CLEANING

SENSITIVITY

NUMBER OF CONCEPTS

36% 11

SENSITIVITY AND CAVITY PROTECTION

% SUCCESSFUL

Source: Nielsen

However, benefits aren’t the only consideration; frequency also seems to have a bearing on success. Concepts that focus on a single benefit fare better than those with multiple benefits which may distract the consumer. And, the single benefit that has seen the most success is cavity protection, perhaps because it is a visible manifestation of poor oral hygiene and can be quite painful.

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FEATURED INSIGHTS | WINNING IN THE GLOBAL ORAL HYGIENE MARKET

WHAT WORKS BETTER?

Number of  Concepts

% Successful

Total Concepts

189

50%

Single Benefit

62

60%

Multiple Benefits

127

46%

CATEGORIES

Base Success Rate

*Base Success Rate: % of successful initiatives out of the total initiatives which have benefits, either single or multiple benefits Source: Nielsen

THE WINNING BENEFIT

Number of  Concepts

% Successful

Total Concepts (Single Benefit)

62

60%

Cavity Protection

12

75%

 Whitening

24

54%

 Germ Kill

10

30%

CATEGORIES

Base Success Rate

*Base Success Rate: % of successful initiatives out of the total initiatives which have single benefit Source: Nielsen

REASON TO BELIEVE IS REASON TO SUCCEED Any ingredients, technology or methods that lend credence to a concept’s benefit claims give consumers a reason to believe (RTB). Success rates in the study show that it’s important for any concept to have RTB, but the combination of multiple RTBs improves chances for success. Moreover, while the average success rate of concepts with RTBs is 54%, natural or herbal RTBs have a much higher success rate (86%) than chemical or technology-based ones (52%).

Copyright © 2014 The Nielsen Company

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HOW IMPORTANT IS IT TO HAVE RTB IN A CONC EPT?

Number of  Concepts

% Successful

Total Concepts

190

50%

Concepts with RTB

166

54%

 Concepts without RTB

24

25%

CATEGORIES

Base Success Rate

*Base Success Rate: % of successful initiatives out of the total initiatives Source: Nielsen

HOW MANY RTBS SHOULD BE THERE?

Number of  Concepts

% Successful

Total Concepts

166

54%

Single RTB

100

50%

Multiple RTB

66

59%

CATEGORIES

Base Success Rate

*Base Success Rate: % of successful initiatives out of the total initiatives which have RTB present Source: Nielsen

CONVINCING CONSUMERS OF THE BENEFIT For consumers to be convinced on the benefit the proposition offers, the RTB needs to be linked seamlessly with the benefit in a relatable manner. The presence of an ingredient or a technology as an RTB needs to be contextualized with their linkage to the benefit the proposition offers. Clearly illustrating this link through the use of impactful visuals substantially enhances the chances of success.

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FEATURED INSIGHTS | WINNING IN THE GLOBAL ORAL HYGIENE MARKET

Number of  Concepts

% Successful

Standalone RTB

92

50%

RTB with a link to benefit

74

58%

RTB - link to benefit visually demonstrated

32

69%

CATEGORIES

Base Success Rate

Source: Nielsen

IMPACTFUL VISUALS LINKING THE RTB TO THE BENEFIT ENHANCE A PROPOSITION’S CHANCES OF SUCCESS.

 A PICTURE IS WORTH A THOUS AND WORDS Visuals and imagery are integral to campaigns, and concepts that have family visuals tend to be more successful than those with visuals of individuals or friends. Meanwhile, visuals of dentists and professionals seem to be losing out on popularity with consumers, who would much rather see visuals of the actual paste.

PICS THAT CLICK

CATEGORIES

Number of  Concepts

EXAMPLE:

% Successful

Total Concepts

71

58%

Individual/friends  Visuals

32

50%

Family Visuals

39

64%

Base Success Rate

INDIVIDUAL/FRIENDS VISUALS

FAMILY VISUALS

*Base Success Rate: % of successful initiatives out of the total initiatives which have either individual or family visuals Source: Nielsen

Copyright © 2014 The Nielsen Company

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DO VISUALS OF DENTISTS/ PROFESSIONALS HELP IN A CONCEPT’S SUCCESS?

Number of  Concepts

% Successful

Total Concepts

72

46%

Dentist/ Institute logo visuals

19

32%

Mouth/ Teeth visuals

26

42%

Toothpaste visuals

27

59%

CATEGORIES

EXAMPLE:

Base Success Rate

DENTIST/ TEETH VISUALS

TOOTHPASTE VISUALS

*Base Success Rate: % of successful initiatives out of the total initiatives which have dentist, mouth/teeth or paste visuals Source: Nielsen

Interestingly, while both RTBs and visuals are individually important to a concept, an RTB supported by a visual substantially increases chances of success. While an average concept with an RTB has a 54% chance of success, a concept with an RTB accompanied by an image of an ingredient has a whopping 89% chance of success. With evolving consumer behaviour and a multitude of new product launches that offer ‘advanced’ benefits in the oral hygiene space, marketers would need to think differently to stand out in a cluttered market. Being in constant touch with the changing needs of the consumer is imperative for both successful innovations as well as impactful communication. According to a report by Global Industry Analysts Inc., the global toothpaste market is expected to grow to $12.6 billion by 2015. The opportunity is even bigger in India. With the domestic market expected to grow at a far greater pace than that of global, India’s oral hygiene market, especially the toothpastes segment, is an exceptional opportunity for retailers and manufacturers.

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FEATURED INSIGHTS | WINNING IN THE GLOBAL ORAL HYGIENE MARKET

COMPARED TO THE GLOBAL ORAL HYGIENE MARKET WHICH IS EXPECTED TO GROW AT 3% CAGR IN THE NEXT THR EE TO FOUR YEARS, INDIA’S MARKET IS EXPECTED TO GROW AT 14% CAGR.

THE NIELSEN QUALITATIVE VIEW ORAL HYGIENE IN INDIA 

BY: SARBANI SEN, DIRECTOR, NIELSEN INDIA

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Copyright © 2014 The Nielsen Company

Conventionally, shopping for oral hygiene products was a habituated, low-involvement activity, where one brand was bought and used by the entire family. But thanks to bigger marketing spends by oral hygiene companies, increasing awareness regarding oral hygiene and higher discretionary income, the consumer is gradually getting more involved in the category. A typical urban family is now buying different kinds of toothpaste as each member looks for something specific. Since modern trade lends itself to product discovery, brands that want to disrupt and pave the way for revaluation can achieve success. Consumers are trading-up from regular to functional toothpastes. Going forward, more specialised segments will open up as the generic product user base shrinks. The role of advertising in building awareness around specialist needs is crucial. Here, communication, as well as below-the-line initiatives like sampling and retail activation, need to be basic and educational in tone.

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ABOUT THE AUTHORS

ADRIAN TERRON

VISHWANATH

EXECUTIVE DIRECTOR

RADHAKRISHNAN

NIELSEN INDIA

ASSOCIATE DIRECTOR NIELSEN INDIA

Juzar Kagalwala from the Nielsen Innovation Practice team was instrumental in creating this issue of Featured Insights.

ABOUT NIELSEN Nielsen N.V. (NYSE: NLSN) is a global information and measurement company with leading market positions in marketing and consumer information, television and other media measurement, online intelligence and mobile measurement. Nielsen has a presence in approximately 100 countries, with headquarters in New York, USA and Diemen, the Netherlands. For more information, visit www.nielsen.com. Copyright © 2014 The Nielsen Company. All rights reserved. Nielsen and the Nielsen logo are trademarks or registered trademarks of CZT/ACN Trademarks, L.L.C. Other product and service names are trademarks or registered trademarks of their respective companies.

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FEATURED INSIGHTS | WINNING IN THE GLOBAL ORAL HYGIENE MARKET