Astera
Premium tooth paste
Feasibility assessment
Romanian market



Premium and mid-tier brands dominate the market
Premium:
66%
–
–
–
–
Colgate
Blend a Med
Aquafresh
Vademecum
–
–
–
–
–
Super Cristal
Astera
Maxam
Super Fresh
Others
Low tier:
34%
43.3%
16.3%
4.7%
1.7%
15.6%
3.8%
3.1%
2.3%
9.2%
Romanian market

This makes the Romanian market highly
different vs. its neighbors – Bulgaria and
Serbia-Montenegro.
Premium / mid tier
Low tier
Romania
66
34
Bulgaria
Serbia – MN
Bosnia
26
32
62
74
68
38
Romanian market

However, the consumption per capita is significantly lower
vs. its neighbors, revealing a strong development potential
Market size
Population
Consumption
(000 liters)
(millions)
(liters / 100)
Romania
Bulgaria
3,000
1,900
22.2
7.5
13.52
24.75
Serbia – MN
Bosnia
2,000
900
10.6
4.0
18.68
21.15
Moldova
Russia
400
39,000
4.4
144.5
8.77
26.77
Romanian market

Within premium segment, anti-cavity
continues to be the largest, but it is strongly
challenged by multi-benefit variants.
% of premium segment
Anti-cavity
57%
Multi-benefit
31%
Single benefit
12%
Romanian market

Key competitors in premium / mid-tier
– Colgate
Plays in 2 price points: anti-cavity and multibenefit
 Market leader, local production, strong image

– Blend-a-Med
Plays in 2 price points: anti-cavity and multibenefit
 Key challenger, heavily investing in TV
advertising and promotions

Romanian market
Price to trade ex VAT
Premium
Brands / Variants
26.500
Colgate Total, BAM Complete
24,000
Colgate Triple Action, Herbal, White, etc
22,000
Colgate Anti-Cavity, BAM Mineral Action
Mid-tier
20,000
Aquafresh Family
Low tier
16,300
Astera Total, Herbal White
14,700
Herbal
12,400
Anti-cavity, anti-tartar
Opportunity

Enter the premium segment
– Create a new brand name.
– Product:
Multi-benefit Astera variants.
– Pricing:
Parity to Colgate and BAM
anti-cavity
– Sizes:
50 ml and 100 ml
Romanian market
Price to trade ex VAT
Premium
Brands / Variants
26.500
Colgate Total, BAM Complete
24,000
Colgate Triple Action, Herbal, White, etc
22,000
Colgate Anti-Cavity, BAM Mineral Action
Mid-tier
20,000
Aquafresh Family
Low tier
16,300
Astera Total, Herbal White
14,700
Herbal
12,400
Anti-cavity, anti-tartar
Opportunity
Price to trade ex VAT
Premium
Brands / Variants
26.500
Colgate Total, BAM Complete
24,000
Colgate Triple Action, Herbal, White, etc
NEW ASTERA BRAND
22,000
Colgate Anti-Cavity, BAM Mineral Action
Mid-tier
20,000
Aquafresh Family
Low tier
16,300
Astera Total, Herbal White
14,700
Herbal
12,400
Anti-cavity, anti-tartar
Why is this launch
important ?



Astera is currently playing only in low-tier
segment.
In the following years, it is expected the
market to shift upwards in the premium tier
(all EU countries have dominant premium
tiers)
Multi-nationals enter opportunistically lowtier: Colgate Super Cristal (Romania),
Colgate Kolynos (Serbia-Montenegro), P&G
Blendax (Russia), any time Unilever can
exploit Maxam across Eastern Europe.
Why is this launch
important ?

In order to continue its growth, it is
compulsory for Astera to play in all
market segments – attacking the
premium tier, while defending the low
tier.
Why is this launch
important ?

Why Romania needs to be the testing
ground for an Astera premium brand ?
– Market is already in majority in premium.
– Costs / risks are lower than in Russia.
– Media landscape is well defined and
controlled.
– There is no risk of parallels (like in
Russia).
– There is a strong Astera organization.
Financial implications
Year 1
Market share
(%)
Sales
(th. liters)
Sales
Year 2
Year 3
5
7
10
99
146
218
(euro)
1,003,106
1,467,081
2,189,395
Distribution
(euro)
220,683
322,758
481,667
Cost of goods
(euro)
611,820
891,371
1,325,051
Overhead
(euro)
160,497
220,062
306,515
Marketing
(euro)
332,000
313,000
325,000
Profit BT
(euro)
-321,894
-280,110
-248,838
Profit BT
(%)
-32.09
-19.09
-19.37
Key assumptions:
Share progression: year 1 – 5%, year 2 – 7%, year 3 – 10% of premium; Cost of goods – 0.32
euro; overhead – 16% in year 1, decreasing to 14%; split 50 ml / 100 ml: 80 / 20, following to
70/30 in year 3.
6 mths advertising (2 mths@400 GRPs, 4 mths@250 GRPs), 125 euro/GRP; Copy shoot –
30,000 per year; Listing + trade mktg – 50,000 year 1, 20,000 afterwards; Promotions –
10,000 euro per year; POSM – 2000; Misc – 15,000.
Financial implications

As this project is important for all
international Astera business, we
recommend the financing of marketing
activities by Astera Bulgaria.
Financial implications
Year 1
Market share
(%)
Sales
(th. liters)
Sales
Year 2
Year 3
Total
5
7
10
99
146
218
463
(euro)
1,003,106
1,467,081
2,189,395
4,659,582
Distribution
(euro)
220,683
322,758
481,667
1,025,108
Cost of goods
(euro)
611,820
891,371
1,325,051
2,828,242
Overhead
(euro)
160,497
220,062
306,515
687,074
Profit BT
(euro)
10,106
32,890
76,162
119,157
Profit BT
(%)
1.01
2.24
3.48
2.56
We do not recommend

Launching only 50 ml would hurt profitability as 100 ml is
more profitable.
Year 3
50 ml
Sales
(th. liters)
Sales
100 ml
Total
153
65
218
(euro)
1,579,728
609,667
2,189,395
Cost of goods
(euro)
347,540
134,127
481,667
Overhead
(euro)
977,962
347,089
1,325,051
Marketing
(euro)
221,162
85,353
306,515
Profit BT
(euro)
33,064
43,098
76,162
Profit BT
(%)
2.09
7.07
3.48
What happens if we launch with
minimum marketing support ?
Year 1
Market share
(%)
Sales
(th. liters)
Sales
Year 2
Year 3
3
4
5
59
83
109
(euro)
601,863
838,332
1,128,377
Distribution
(euro)
132,410
184,433
240,833
Cost of goods
(euro)
367,092
509,355
662,525
Overhead
(euro)
96,268
125,700
153,258
Marketing
(euro)
242,000
192,000
198,000
Profit BT
(euro)
-235,937
-173,203
-159,919
Profit BT
(%)
-39.20
-20.66
-14.61
Key assumptions:
2 mths advertising @400 GRPs, 125 euro/GRP; Copy shoot – 30,000 only in year 1; Listing + trade mktg –
75,000 year 1, 50,000 afterwards; Promotions – 20,000 euro per year; POSM – 2000; Misc – 15,000.
Key conclusion



Project is strategically important –
Romania is already a premium market, the
others markets will follow sooner or later.
Project helps defend Astera position –
multinationals have already entered low-tier
(Colgate’s Super Cristal in Romania, Kolynos
in Serbia-Montenegro, P&G’s Blendax in
Russia, maybe Lever will exploit Maxam),
attacking Astera’s traditional segment.
Project can be replicated in other markets.
Next steps



Our recommendation is to proceed with a
full fledged premium brand development
work – this will help us also validate the
volume objectives.
Our recommendation is to use Romania as
test market – upon success, roll it over
Eastern Europe.
Our recommendation is to use Concept
Marketing & Vanzari expertise in brand
development.