Monday, September 29, 2003 | |
The emerging floss oligopoly Procter & Gamble recently announced an expansion of its personal care products line by buying the right to sell Glide dental floss. The products was sold to P&G by W. L. Gore & Associates, the maker of Gore-Tex, a company that is mostly in the waterproof clothing industry. Glide makes use of the company's patented polymers. The purchase complements P&G's already strong position (#2) in toothpaste, with its Crest second only to Colgate-Palmolive's Colgate. (Colgate sells over $1 billion worldwide, and Crest is close.) Glide is the number 2 dental floss in the American market, second to Johnson & Johnson's Reach. According to a Wall Street Journal article ("Procter & Gamble to Buy Glide Floss," 9/17/03), floss is a $200 million business in the US, and Glide now sells about $44 million (22%) of that total. By contrast, Johnson & Johnson owns 43% of the market. (Colgate-Palmolive has a small position in the market under the Colgate brand.)
Actually there's a big upside potential for both products. "While three-quarters of Americans brush their teeth at least twice a day, less than 20% of Americans floss twice a day," according to the American Dental Association. And only 2.5% of households regularly floss. This product is part of a classic acquisition. It goes from a company that does not deal regularly with drug stores and other retailers that might stock dental floss, to a company that has big leverage in that market. P&G also has the marketing muscle to increase usage significantly for all dental floss, with the same techniques that have made hair conditioner, body wash, and other once unknown grooming trends into nig-sellers. And there is the world where Colgate and P&G have spread the American obsession with tooth brushing and whitening throughout the world; why not floss? 6:19:07 PM |