Hll Aims For New Segment

Hindustan Lever has announced the launch of a third toothpaste brand, Aim, at a 40 per cent discount to products from its closest rivals.

HLL's other toothpaste brands are Close-Up and Pepsodent.

The new brand will primarily target the rural market, where the penetration of toothpaste is still low. Aim may also help HLL to tackle the phenomenon of consumers downtrading to cheaper brands.

Arun Adhikari, director (personal products), HLL said: "Though there is no clear evidence of downtrading yet in the toothpaste market, we hope to reach out to non-users as well with an affordable product."

A 50 gm pack of Aim will cost Rs 8 each, against Rs 14.50 for a comparable product of any rival. A 100 gm pack has been priced at Rs 15.50 compared with Rs 27.50 on any competing product, while a 20 gm pack has also been launched at Rs 3.

 

Analysts expect Aim to give stiff competition to other low-priced products like Babool. However, the launch may also prompt similar moves by competitors.

The company will have to make substantial investments, associated with the launching of any new brand. However, Adhikari declined to give details of HLL's proposed advertisement expenditure.

Mukul Deoras, general manager, marketing (oral care), said the company was hoping to corner a marketshare of 10 per cent within three years.

The launch will see HLL attempting to become a volumes player in a segment dominated by Colgate.

Colgate enjoys a national marketshare of 49.7 per cent. HLL's brands, Pepsodent and Close-Up, have a combined marketshare of 35.5 per cent.While Close Up, which targets the youth segment, has a share of 19.5 per cent in the national market, Pepsodent, launched only in 1993, has cornered a market share of 15.9 per cent.

Adhikari said the company will ensure that there was no cannibalisation with its existing toothpaste brands, both of which are positioned at the higher end of the market. To make its products more affordable to consumers, HLL has already launched both Pepsodent and Close Up in smaller 20 gm pouches.

Aim, Deoras said, combines the benefits of calcium and Neem, and will seek to shift users of toothpowders to toothpaste. The size of the toothpaste market is estimated at 75,000 tones, while that of the tooth powder market is at 25,000 tonnes. Demand growth in the sector has remained flat last year at 5 per cent as compared with the previous year.