Oral care has become one of the hottest categories in package goods-and one of the few generating big sales increases. A yet-to-crest wave of power-toothbrush offerings has added more than $159 million in sales to the $469 million category for the 52 weeks ended June 17, according to Information Resources Inc. Procter & Gamble Co. projects at least $200 million in year-one retail sales for its Crest Whitestrips whitening kits, priced around $40 each. And national outlets like BriteSmile, a tooth-whitening chain with some franchises that charge up to $700 for whitening, has seen triple-digit gains in sales and stock price this year.
Recognizing the opportunity, nearly every player in the U.S. oral-care business is launching a battery-powered toothbrush or new angle on breath freshening. Announced oral-care launches from Gillette Co., P&G, Pfizer, Johnson & Johnson's Reach and Den-Mat Corp.'s Rembrandt are scheduled to get at least $250 million in marketing support combined in the next year. Colgate-Palmolive Co., fresh off introducing a two-in-one toothpaste and mouthwash in January, is preparing to launch Colgate Motion, a value-priced power toothbrush aimed at competing against P&G's Crest Spinbrush, which posted first-year sales of $68 million.
While power toothbrush sales are clearly growing, lower-priced models may be gaining the upper hand, said Tom Vierhile, general manager of new-product-tracking service Marketing Intelligence, pointing to Colgate Motion. "This is really the last bastion of the gadgeteers," he said, noting that toothpaste launches are actually down 67% to 22 through the first seven months of the year, while new dental accessories, ranging from temporary tooth tattoos to tongue cleaners, are up 118% to 111.
Cosmetics clearly are overcoming economics, said William Steele, analyst with Banc of America Securities. "In the very difficult-to-grow household-products industry, there are three growth areas-hair care, skin care and oral care-and the common denominator is that they're all visual," he said.
The benefits aren't just visual. In some cases, they may be imaginary. Describing the rationale behind this fall's $35 million launch of the Arm & Hammer Advance Breath Control line of toothpaste, mouthwash, gum and mints, Church & Dwight Chairman-CEO Robert Davies last month told analysts his company is targeting "fresh-breath fanatics," an estimated 20% to 35% of the U.S. population. "These people may or may not have a breath problem," he said. "But they are people who are constantly concerned about their breath."
To better serve the breath-obsessed, Church & Dwight has been trying to convince retailers to carve out a breath-care section within oral care that includes not only mouthwash but also breath mints and toothpastes that make long-lasting breath-freshening claims.
Meanwhile, at the highest end of cosmetic dentistry, BriteSmile, a chain of laser-enhanced whitening centers launched three years ago, last week reported second-quarter sales up 185% to $12.3 million, even as it tests raising prices for whitening sessions at company-owned stores from $500 to $600. Reminiscent of the halcyon days of dot-com froth, BriteSmile's stock is up more than 350% for the year to $10.05, though the company has yet to turn a profit.
Even in New York and San Francisco, cities hit by downturns in the technology, finance and advertising industries, BriteSmile is testing higher fees. In San Francisco, home to two of BriteSmile's 14 company-owned centers, same-store sales are up double digits this year even as participating dental offices tripled to 150, said Mike Whan, president-worldwide marketing of BriteSmile.
BriteSmile, which spends about $20 million annually on marketing, uses high-intensity light to help deliver an average of 8.5 shades of whitening per session, about five times better than whitening toothpaste and three times better than Whitestrips, said Mr. Whan, himself a former Crest brand manager. And unlike other options, BriteSmile's results appear the same day.
BriteSmile is still expanding nationally, but same-store sales are up 54% year to date. "If there's a recessionary impact on whitening, we don't seem to have seen it," Mr. Whan said. "The data suggest there was a lot of pent-up demand."