Hair Care Product
Hair care product is the fastest growing category within personal products.
According to the article “Putting the Money Where the Leather Is” by HINDU Group of Publication in 2001, between 1994 and 1998, the market size of FMCG products such as skincare and toothbrushes doubled in value. But the size of the shampoo market expanded two and a half times over the same period. Unlike other FMCG products such as soap and detergent, shampoo remain at a low penetration category with relatively low degree of innovation years ago. In year 1958, a chemical-based Taiwanese manufacture company, Topson Chemical (脫普化工) has first introduced powered-shampoo to the Taiwanese market; and it is not until year 1964 has the company introduced liquid-shampoo as a new hair-cleaning product to the Taiwanese market. At this time, a newly established company Nice (耐斯) has also entered the shampoo market by introducing the Nice-brand powered-shampoo. In year 1966, Kao (花王) has decided to enter the shampoo market with strategic marketing strategies such as promotion and giving out free sample products in order to further open up the shampoo market and to seize market share in Taiwan.
At this time, the shampoo market in Taiwan is dominated by just a few players;
consumers in Taiwan are educated and informed about the product advantage and are
products. Starting from 1970, brands such as Nice 566 (耐斯 566), Yang Yang Shampoo from Namchow Manufacturer ( 南 僑 的 洋 洋 洗 髮 精 ), and the first quality-emphasized high priced shampoo brand “可麗柔綠野香波”, have entered the shampoo market. However, despite the undisputed potential in market expanding, the expansion of the shampoo market in Taiwan was stagnated in the 1980’s. The reason for the stagnation is lack of innovation to encourage consumer trials and to further develop their consumption behavior.
Proctor & Gamble (P&G) Taiwan was established in 1985. It is a pioneer in many areas with brands such as Head & Shoulder, the first two-in-one shampoo with conditioner – Pert. In the recent years, brands such as Sassoon and Pantene Pro-V have successfully gained market competitive advantage and market share in the Taiwanese market. P&G Taiwan is also well known as an innovator in the P&G world. The model of success for Pantene Pro-V shampoo in Taiwan was rapidly re-applied globally leading to outstanding results. In 1992, with the increasing introduction of new shampoo brands by large global companies such as P&G from the United States, Unilever from UK, and Kao from Japan, the war of shampoo is officially started in the Taiwanese market (劉思明: 國內洗髮精市場研究). At that time, Kao was the market leader with 14.5% market share, followed by Unilever with 9.8% market share and P&G with 4.8% market share. These three global companies have accounted for approximately 30% of the total market share in the Taiwanese shampoo market. The three largest local shampoo brands were Nice with 14.7% market share, V05 with 6.8%
market share, and 金美克能 with 6.2% market share. However, after 7 years of new product development, innovation, and the use of competitive marketing strategies, the role of market leader has changed. The three global companies have increased their total market share from 30% to 70%; this rapid growth was the result of innovative
product development, use of abundant global resource and enormous investment in advertisement. In year 2000, P&G has successfully climbed to the top of the Taiwanese shampoo market with 38.9% market share. Unilever was the second market leader with 22.9% market share, followed by Kao with 8.7% market share. Under the rapid competition and copious advertisement, the local shampoo manufacturer has faced considerable challenge and could barely survive anymore.
According to research, currently the major shampoo brands in the Taiwanese market are Head & Shoulder (海倫仙度絲), Kao (花王), Sassoon (沙宣), PERT (飛柔), LUX (麗仕), Organics (坎妮), and Dove (多芬). These major players have been trying to develop the shampoo market by expanding the functional benefits of their products.
This has enriched product varieties and provided consumers with additional choices.
Shampoo products with added utility values such as anti-dandruff, shine-effect, vitamin-added, and color-preservation were introduced to the market. Procter &
Gamble has introduced Head & Shoulders Menthol and Pantene Lively Clean, building additional product value on the existing products. Lux has used celebrities such as Demi Moore and Catherine Zeta-Jones in its advertisements to emphasize the new ingredient which would add a smooth and shinning touch to your hair. It has also become common for one brand with different versions of product for dry, normal and oily hair. These product strategies could increase volume and expand margin since these added values enable brands to command a price premium over the plain shampoos. However, the success of functional benefit-added shampoo products has drawn attention to shampoo manufacturers; new products with numerous different functional benefits were pushed onto the shelves. This has diluted the opportunity in the value-added shampoo segment and started another wave of product differentiation
Beverage Product
In order to analyze the trend of the Taiwanese beverage market, we have to look back into the history of how the market is developed in Taiwan. HeySong Corporate (黑松) , established in year 1924, is believed to be one of the first local soft drink manufacturers in Taiwan. Year 1956, HaySong has stimulated the
“instant-consumption packaged” soft drink market in Taiwan by importing the first automated soft drink production line into Taiwan, and has made a fortune out of it. In 1968, HeySong faced strong competition and gradually lost its market share after the two international giant soft drink manufacturers, Coca-Cola and Pepsi-Cola, have entered into the Taiwanese market. HeySong has once successfully out-performed Coca-Cola and Pepsi-Cola on its soft drink product; according to AC Nelson, it was still the market leader with 27.2% market share while Coca-Cola and Pepsi-Cola had approximately 25.6% in total in year 2002. However, with abundant international resource and successfully marketing and sales experience, Coca-Cola had replaced HaySong and became the market leader of the soft drink product in Taiwan. By pushing the product vigorously into the Taiwanese market, Coca-Cola had also brought the American lifestyle into Taiwan.
The warm tropical-island weather of Taiwan has made this country a competitive target market of most beverage manufacturers inevitably. According to a survey conducted by AC Nelson, the beverage consumption in Taiwan is among the top of the list world-wide. In 1994, there were approximately 1,000 new products being launched to the beverage market in Taiwan; in the same period, about 900 new products were launched to the Japanese beverage market, and only 100 new products were launched to the beverage market in Hong Kong. (thesis) In the recent years, the Taiwanese
beverage market is getting increasingly competitive. Statistic stated that 5 major brands were accounted for 50% of the market share in year 1990; however, after three years the same market share were occupied by 9 major brands. Furthermore, due to the fast switch on preferences of the consumers, the life-cycle of beverage products is getting shorter and it is also getting increasingly difficult to successfully lunch a product that attract consumer and appeal to their taste.
In the recent years, beverage-consumers have focused their attention on “health conscious.” This has opened up the market for tea, 100% pure juicy, and yogurt-drink in the Taiwanese beverage market. Bo-Mi (波蜜果菜汁) is considered to be the most well-known juice brand in Taiwan due to its long history, competitiveness, and outstanding product performance. In a survey conducted by EICP in 1999, the result has shown that Bo-Mi was the second brand in favor, only a few percentage behind Sunkist’s 31.6% (香吉士果汁), when the consumers were asked which brand was their favorite juice brand. However, after 6 years, Bo-Mi has successfully climbed to be the market leader with 44.2% of market share in the Taiwanese juice market. During 2003 and 2004, tomato juice suddenly became the most popular and top-seller among all the juice products due to SARS. It is said by physicians and believed by the general public that tomato juice contained the necessary vitamins that could prevent SARS. As the result, the juice market in Taiwan was ruffled abruptly; tomato juice suddenly became the hottest product in the beverage section of every convenience store. However, the tomato-heat withdrew from the market as fast as it entered into the market; according to EICP, by the end of 2004 the market share of the number one seller AGV tomato juice (愛之味鮮採蕃茄汁) has dropped from 23.3% to 19.5%. On the contrast, Bo-Mi has climbed to be the market leader with 44.2% market share, followed by
The success of Bo-Mi is based on its product and marketing strategies. Bo-Mi sees the trend of increasing number of people dinning out, therefore, it successfully connects its beverage image with the idea of “vegetable and nutrition added for your need in daily life.” This strategy has successfully reached its target customer and provided them with an alternative choice for vegetable and fruits. This marketing strategy not only satisfies the needs of Bo-Mi’s target customer, but acts as a problem-solver as well. Although juice and other beverage such as soda pop, yogurt drink, and carbohydrate drink constitute certain percentage of the total beverage market share, the sales of those are incomparable with beverages, that have strong
“thrust-relieve” characteristic, such as bottled water and tea. The number of consumption of beverages such as bottled water, milk, and tea are calculated by how many times they were consumed daily; however, the number of consumption of beverages such as soda pop, juice, and yogurt drink are calculated by how many times they were consumed weekly. For instance, according to EICP in 2005, the percentage of consumers who drink juice at least once a week is 25.4%, but the percentage of consumers who consume bottled water at least once a week is 92%. Therefore, numerous beverage manufacturers, such as HeySong, Coca-Cola, and Uni-President, have placed increased attention on larger-consumption beverages such as tea and bottled water. In the recent years, bottled water is re-named and known as “packaged water” (包裝水) in the effort to try up-grading the image of bottled water from “just water” to pure, clean, and healthy water. It is also observed that since 2004, the tea market has been rising so rapidly that the sales of other beverages were affected. Not only the number of purchasers has become smaller, but the number of consumption has become fewer as well. It is easy to identify the trend of tea in the beverage market by noticing the increasing number of brands and varieties of tea drinks come into sight on the shelf of every convenience store.
Feminine Hygiene Product
The feminine hygiene products include those that specifically intended to protect women from menstrual flow. Less absorbent versions of products also protect from discharge between menstrual cycles and/or light incontinence. The category comprises two segments: sanitary pads/liners (external protection products) and tampons (internal protection products). This research is specifically focused on sanitary pads for external protection. The first disposable sanitary pad designed to replace the old-fashioned washable cotton cloth used during female’s menstrual period was developed by a US FMCG manufacturer, Kimberly-Clark, in 1921. This very first disposable sanitary pad was named Kotex. Six years after the launch of Kotex, the market reaction has proven the success of the disposable sanitary pad; thus another FMCG manufacturer, Johnson
& Johnson, has plunged into this market with its newly developed brand Modess in 1927. These two brands have been the leading brands of the sanitary pad market for many years until more competing brands have taken part in the market.
Sanitary pad is considered to be luxurious exported goods during the 1920’s in Taiwan. Due to the lacking of manufacturing technology and know-how, all sanitary pads were imported at that time. The sanitary pad market in Taiwan was dominated by only two brands – Kotex and Modess. However, the product was designed according to the needs and preferences of American female; they were not exactly suitable for Asian female. Furthermore, the functionality of those sanitary pads was barely satisfactory;
complaints regarding to the uncomfortable feeling, infirmness, and inconvenience were received from consumers. Therefore, Japanese and Taiwanese manufactures started to invest in the production and improvement of sanitary pads in order to develop more
produced by the Taiwanese manufacturer, Kang Na Hsiung, was finally launched into the market. With the breakthrough innovation of putting double-sided adhesive at the back of the pads, the improved product has provided consumers with increased sense of security and convenience. As living standard and consumer life-style change, manufacturers have been making continuous product improvement, adding new functions, and integrating innovative materials to produce more satisfying products with different attributes. At the same time, sanitary pads have shifted from the luxurious exported goods to the indispensable female hygiene goods. The increased usage and high gross margin have attracted increased number of competitors into this market; leading to the intensifying market competitiveness in the recent years.
According to an article reported by Chinatimes on April 13th this year, the current market value for feminine hygiene products in Taiwan is approximately 45 hundred million dollars. Last year, the total sales volume was approximately 23 hundred million pieces; among which the sanitary pads used during menstrual period accounted for 80% of the total sales volume, and the panty liners accounted for the other 20% of the total sales volume. According to market research, the feminine hygiene sanitary market is dominated by six major brands: Whisper (P&G), Sofy (Unicharm), Kotex (Kimberly-Clark), Laurier (Kao), Modess (Johnson & Johnson), and Carnation (Kang Na Hsiung). Among the six brands, Sofy is the market leader with approximately 31% market share, followed by Whisper with 24% market share, Kotex with 21%
market share, and Laurier with roughly 15% market share. According to Meg Hargreaves, VP of Publisher Relations and Content Development for MarketResearch.com, the feminine hygiene industry is a mature industry, and it has become increasingly dynamic as it operates to recognize the changing attitudes of its consumers. “Although marketers of feminine hygiene products have something of a
captive audience, they are becoming increasingly innovative and solicitous with their product offerings and women appear to be a receptive audience for new and improved products,” said Ms. Hargreaves.
As mentioned by Hargreaves, each manufacturer strives to capture consumer’s attention with innovative product design, product material, packaging design, and added functional benefits. Products with different features such as super, slender, overnight, with or without wings, deodorant, maxi, mini are flourishing on the store shelves. Each manufacturer places emphasis on its particular product attribute in order to differentiate its brand from its competitors in the industry with specific functional benefit. For instance, Sofy was the first brand that has “side-stopper” designed to prevent overflowing, and was the first brand introduced with extended length for consumers who lack sense of security during nighttime and maximum flow period.
Whisper is not only the first brand that has the design of side-wings, but it is also recognized for its unique dri-weave top sheet which reduces the feeling and uncomfortableness of wetness to one tenth of ordinary (non woven) top sheet pads.
Kotex has a special design that allows quick absorption; Carnation offers its consumer with quality non-woven material that provides utmost comfortableness; Laurier has focused on proprietary materials with unique functions such as super absorbent polymers and breathable sheets that provides concentrated absorption and prevents irritation.
During the past 80 years, sanitary pad in the feminine hygiene industry has shifted from new product to mature product. The market is now dominated by several major players instead of only a few, and brands carry increased innovative functional benefits
price-cut and manufacturers are spending additional budget on advertising and promotional activities. Brand loyalty has also become a major challenge and issue for manufacturers. In the old times, the users of sanitary pads were often life-long brand loyal consumers since there were only two dominating brands and consumer had not much choice, or even if there were choices they would be too shy to stand in front of the sanitary pads and take time to compare the products. However, it is not surprising to see frequent brand shifting since nowadays consumers are not only price-sensitive but also have more choices when selecting products that best suit their needs and preferences.
CHAPTER FIVE