Brand Analysis Arm & Hammer Term Paper

  • Length: 5 pages
  • Subject: Business - Advertising
  • Type: Term Paper
  • Paper: #31229117

Excerpt from Term Paper :

Another 25% is usesd in the food and beverage industries, and pharmaceutical and personal care products making up 10% of the market. The rest is: chemical manufactureing, 9%, cleansers and detergentsm 8%; water treatment, 7%, and: miscellaneous uses comprising the remainder (Graff 2000).

Because of its diverse uses, sodium bicarbonat has experienced stable, steady growth year after year, usually I the 3 to4% range according to Curt Siverling, sales and marketing director for specialty products at FMC. While Siverling expected this performance to continue, it is notable that Church & Dwight's performance was many times that in terms of earnings (21%, as noted above), although their net sales increase was only 1%, also noted above.

Brand equity

Any brand that has remained virtually unchanged in the American marketplace for 148 years would have to be considered one that enjoys extraordinary customer loyalty. Weisz demonstrated Arm & Hammer's brand loyalty when she quoted several customers concerning their reasons for making a product choice. One, a NewYork City attorney, claimed his Arm & Hammer baking soda toothpaste was as important to him as his favorite power tie because he believed it freshened the breath better than any other toothpaste. As it happens, many people agree with him concerning the efficacy of baking powder in toothpaste; such toothpastes -- Arm & Hammer's and others -- accounted for 25% of the $1.4 billion toothpaste market in 1994 (Weisz 1994).

A therapeutic effect on oral health derived from baking soda has not been proven. However, consumers "like flavor of baking soda toothpastes, which are less sweet, and say it makes their mouths feel clean and fresh. Of course, people used plain baking soda to clean their teeth years before baking soda toothpastes came on the market. Its value "was reaffirmed by one's grandmother,' said Brett Shevack, president of Partners & Shevack, the agency for Arm & Hammer products (Weisz 1994).

In addition, Arm & Hammer has maintained an all-natural image for 148 yeas a well, a fact which has helped it 'infiltrate' products fromom many other companies from Procter & Gamble to Colgate (Weisz 1994).

There is usually a backlash against excessively popular ingredients in consumer products, and that has happened with baking soda, also, according to Weisz, with DenMat's Rembrandt Brushing Gel using the words "Baking Soda-Free" as a marketing tool (1994). However, that is unlikely to tarnish Arm & Hammer's image or fortunes very much.

Analysis

It is apparent that, for at least 150 years, Arm & Hammer has been virtually the only major player in the baking soda business per se; it has been able to parlay that strenghth into effectively niche marketing its main product as an additive or enhancer to other products. At the end of 2004, Church & Dwight Company, Inc., reported net income for the third quarter of $27.4 million, or $0.42 per share, and $0.11 per share increase, or a healthy 35%, over the previous period a year earlier. In fact, except for accounting mandates regarding their adquisition of the remaining 50% interest in Armkel LLC, the net income per share would have been even higher.

For fourth quarter 2004, Churhc & Dwight was looking at increasing its marketing spending over the same perioed a year earlier, primarily to step up marketing for Arm & Hammer Enamel Care ™ tootpaste, a new patented product combiing cleaning and whitening with fluoride and caclcium to fill tooth surfaces. It also planned on enhancing marketing budgets of its non-baking soda brand items, such as Trojan ® Warming Sensations ™ condoms.

It is likely that Arm & Hammer baking soda will continue to enjoy a good market; it is still the only major baking soda on grocery shelves in the United States. However, because of its new position as a product enhancer, both for its own proprietary items and as an additive to the products of other housheholod and personal care companies' products, the future appears to be as bright as the past 150-plus years have been.

References

Church & Dwight. (2004, July 1). Household & Personal Products Industry. Retrieved 15 May 2005 from www.highbeam.com.

Church & Dwight reports third quarter results; GAAP earnings per share increased 35% on strong sales growth. (2004, November 9). Business Wire.…

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