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Business Environment Analysis: Oral Care

Autor:   •  October 27, 2016  •  Case Study  •  8,678 Words (35 Pages)  •  393 Views

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Business Environment Analysis: Oral Care

This paper focuses on the toothbrush segment of the oral care industry. The current business environment and historical innovations provide significant influences that contributed to the development into today’s oral care market. An actual business, Oral-B, is evaluated by internal and external factors pertaining to the company’s competitive readiness. The SWOT and PEST analysis provides supporting evidence of a strong competitive advantage. Intrapreneurial and entrepreneurial opportunities are identified and assessed. Global consumer market trends that impact the opportunities and overall sustainability of the business are related to the environment and market domain. Oral-B is proven to be a top competitor of the current market and its opportunities place the business as a front runner in the future market condition.

Market Domain

Historical Significance

The oral care industry generated $6.5 billion dollars in 2014. A segment of this industry, toothbrushes, consisted of over $1.1 billion dollars. Manual toothbrushes represented $800 million and powered brushes represented $350 million of this segment, see Graph 1. According to a survey of over 28,000 American households during 2014, 83% used manual toothbrushes while 14.5% used powered, see Graph 2. Considering the figures above, customers preferred manual brushing six times more than powered. The industry could project $2.1 billion dollars in powered toothbrush sales if shoppers preferred powered over manual.

Crude variations of today’s modern manual toothbrushes were produced for the U.S. in 1885. The bristles of this model consisted of stiff animal hair attached to a handle made of wood. A more modern form of bristle was introduced by the late 1930’s made of a softer material, nylon. The Library of Congress stated that “Americans were influenced by the disciplined hygiene habits of soldiers from World War II. They became increasingly concerned with the practice of good oral hygiene and quickly adopted the nylon toothbrush” (Library of Congress, 2010). The first powered toothbrush was presented to the U.S. market in 1960. The design of this model was powered through an electrical wall outlet. Its target market was intended for clients with inadequate dexterity and dental fixtures.

Factors

Competition. The Sherman Antitrust, Clayton and Federal Trade Commission Acts were federal laws built to suppress monopolies, prohibit mergers and acquisitions likely to increase prices and outlaw unfair competition in any market. The Oxford Journal explained these laws to be “…aimed at preserving free and unfettered competition as the rule of trade” (Stucke 2013). The American market was built on competition and regulated for it. Competition shaped

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