Engaging Story of Toothpaste

Do you feel boring of doing a thing without any change? Especially when you have to do it TWO TIMES A DAY and EVERYDAY! That is, I bet you are right, brushing your teeth.

Start making it a joyful experience and have a better life a little bit every other day! Everyday start differently and have a mood flavor for yourself! Here is a story about how a customer makes her life brighter and with higher quality with our product.

Ellie is a girl that doesn't like her life to be on the same routine everyday. She is seeking for new things and wants to improve her quality of life, in which having fresh things is a critical measure to that.

However, while constantly enjoy changing styles and routines to remain fresh  for other daily behaviors in life, for example, the way of cooking and styles of dish, Ellie would like to look for new things to make the life in the morning better. She has changed the color of toothbrush, changed to power toothbrush, sonic toothbrush once or twice, and cup she uses, the facial cleanser she used in the morning and even the odor in her bathroom, but nothing gives her continuous incentive and she gets tired after awhile.

The most annoying thing to her is the flavor of the toothpaste. She has tried ever flavor she can find in grocery stores, supermarkets and drug stores, but all of them are in different types of mint. Everything is in mint. There is no way she doesn't love mint, but she hate unchangeable. What she hates most is, she can do nothing about it. There is no other flavor in the market, and there is no other way to brush her teeth. However, this time when she goes to drug store to shop again, she discovers a whole different toothpaste: anything but mint! There are 8 different flavors, she won't be worried about no other choose from mint for a long time in the future, and the way she brushes her teeth is different as well. She can customize her toothpaste with different flavors in cartridges by putting them in a toothbrush that can take 5 cartridges in total. Everyday with new flavors, and she can choose flavors by spin the wheel randomly and have a surprise of the flavor in her mouth.

A perfect day starts with brushing your teeth differently!

Market Size Research

I would like to address the market size of whole toothpaste market.

In the report of 2011 US toothpaste market, the total sales excluding Walmart is $1.38 Billion and 476.2 Million in unit volume. Of that, Colgate and Crest occupy 70%, which leaves 30% for rest of brands and products. Also, the sales of toothpaste has increased by 5.7% compared to last year. Therefore, I assume the growth rate will at least be the same in 2012 since the US is experiencing a economy recovery. In conclusion, there will be $.65 Billion for products other than Crest and Colgate. However, even among those minor brands, the market is still not divided evenly. Products and brands such as Sensodyne and Aquafresh are still own larger market share than unknown brands. Based on another resource, Aquafresh has a market share of 8% in the US market in 2010. Therefore, I would assume rest brands hold a left market share of 15%. According to an article in WSJ, there are 352 different types and sizes toothpaste in the market. Of that, 80 products come from Colgate and Crest, and according to my research, Aquafresh and Sensodyne have 8 and 10 different toothpaste, respectively. Thus, I would assume there are 250 products left for those 10% market.

In conclusion, I assume we will have 1.38*1.057*.15/250=.875 Million in the US.

Some Thoughts for Inbound Marketing

Can today's company survive on inbound marketing? Yes.
Can today's company survive only on inbound marketing? I would highly doubt about it.

Though it's a new term in marketing world, Inbound marketing has already been integrated and regarded as a necessary aspect in marketing strategy.

The appearance of internet really has changed every aspect of the world. From customer behavior to purchasing process, it's not only about another distribution channel any more. Everyone seems agree on the statement that customers nowadays tend to come to the company to look for information and products instead of receiving information and product recommendations from companies. Also, consumers are more skeptical than ever towards the message sent by companies, thus Google came up with the word ZMOT to describe the change of customers' buying behavior and to warn companies they should pay more attention to their PR and customer satisfaction now. They can not only affect existing customers' loyalty, but also have an effect on new customers' acquisition and its brand image among the market. What's more, potential shelf-space may also be affected by this ZMOT.

ZMOT is so closely related to today's inbound marketing. First of all, whether the source the customers hear of a specific brand or product is credible is primarily have a difference in consumers' decision making. What's more, whether a company has the authority to solve a problem or fulfill a need is also decided by customers themselves. Thus, companies should pay attention on PR and creating its authority through other newspaper and magazine articles. Mentioned by experts in a specific industry is another aspect to raise reputation and awareness through inbound marketing. Also, after customer using products or receiving service, they will also give feedback to company and telling others their feeling. Internet makes it much more easier than ever before. Bad news and unhappy feelings spread quickly with social media. Therefore, companies should take care and consistently focus on its customer reviews. It may even cause them not showing up in customers sight. Think about those products with lower than 4 stars customer reviews in Amazon.com. Customers skip those kind of products to narrow down their search results so that they don't have to read thousands of pieces product descriptions.

However, outbound still holds a critical position in a company's marketing strategy. We can see from every year's Super Bowl commercials. The ability of appearance on popular and related channels and programs is considered into a company's credibility and authority as well, especially for those brand that already famous to keep its brand image. Also for a new brand in some industry, let's say automobile, if a company only appears on internet without physical appearance, customers will still have a hard time to trust in the brand and product. In addition, customer experience is still one of the most important marketing effort companies are making, which can only be achieved perfectly by outbound marketing such as in-store shopping assistance.

Why can't big companies innovate?

From the case given in the article, we can see that the failure does not appear because of nothing. Though one of the seven sources of innovation is about process innovation, this one is not really the thing. When big companies are trying to innovate, they tend to be more conservative than those start-up companies. They don’t want to start from zero and prefer to use the resources they’ve already had. Therefore, when they try to innovate, they still can’t get rid of those bad things and their thoughts have been limited.

From my perspective, it is more like doing budget. Since large companies have such a long history and lots of data about their budget, they don’t want to start from zero and do zero-based budget, which needs them to put much more effort and resource in. They only like to do budget based on historical data, such as incremental budget, only change a few things and seems to be “more efficient” than zero-budget. However, it cannot make companies discover the inefficient things underlying the company, which will lead to hidden problems in the future. Though zero-based budget seems to be time-consuming and a waste of resources, it can help the company go through what they have and give them a better thought about how to make the operation better and more efficient.

In this case, what the company is trying to do is to avoid “waste of time and resource” and try to come up with what they have. They only focus on internal environment, instead of outside. The research of customer needs and market size they have missed are critical to its failure. It is not an innovation of new product; they just try to avoid the excess capacity they cannot take fully advantage of, and they don’t make it. If they want to do innovation for their products, they need to thoroughly analyze all the resources they have and the industry environment, the market, and even the economy and policy they have in the country they want to enter. And then they need to compare what they need and what they have got in hand to see the gap and to acquire other things.

I think innovate is not much more complex than take advantage of excess capacity and need to be treated well enough to really begin the innovation. Otherwise they can make extra revenue by undertake outsourcing orders from other companies.