Philips 2013 Annual Report Download - page 14

14 Annual Report 2013
Around the world, we are working together with our partners and
customers to optimize every step in the value chain. This end-to-end
approach is enabling us to innovate and execute faster and more
efficiently.
Driving growth in oral healthcare
In Germany, we are building on our professional
recommendation strategy and driving conversion of
manual toothbrush users to electric tooth brushing
through innovation leadership, portfolio expansion and
distribution via new channels. This end-to-end
approach resulted in a market share improvement of
over 7%.
With only a third of German households owning a
rechargeable toothbrush, there is a significant
opportunity to expand our leadership in the sonic
toothbrush segment. Taking an end-to-end
perspective, we identified three key drivers for
expansion: driving and communicating innovation
leadership with superior propositions; creating a Philips
Sonicare proposition at a price-point accessible for a
broader audience; and making that proposition
available to consumers in channels like drugstores and
hypermarkets.
Philips Sonicare is already leading in the German
market, with consumers responding to superior
propositions like Flexcare Platinum and
DiamondClean. In 2013, our leadership position was
further supported through celebrity endorsement,
which is driving awareness and conversion.
To present current manual toothbrush users with more
alternatives from Philips Sonicare, driving growth in the
mid-segment, we created a more accessibly priced
proposition, the Philips Sonicare PowerUp. This
product features similar brushing movements to
manual and is gentle and eective. Research showed
that over 90% of consumers surveyed preferred the
Sonicare PowerUp over their manual toothbrush.
The majority of electric toothbrushes and replacement
brush heads are sold in drugstores and hypermarkets.
To leverage this opportunity, Sonicare PowerUp
launched in DM and Budni drugstores, as well as
Kaufland and Marktkauf hypermarkets, adding 2,000
stores to our distribution. We optimized our supply
chain to work with these partners, designing bespoke
packaging, significantly reducing time-to-market and
improving transparency.
In less than a year our end-to-end strategy resulted in
strong market share gains and double-digit growth in
brush head sales. Consumer satisfaction increased,
with patients advised by their dentist to switch to
electric brushing conveniently able to purchase a
Philips Sonicare and replacement brush heads at their
local drugstore.
End-to-end – building a winning
value chain