The U.S. Sanitary Pads Market: A Competitive Profile

Y. Datta


This is the seventeenth paper that follows the footsteps of sixteen studies that have tried to analyze the competitive profiles of U.S. consumer markets: Men’s Shaving Gel, Beer, Shampoo, Shredded/Grated Cheese, Refrigerated Orange Juice, Men’s Razor-Blades, Women’s Razor-Blades, Toothpaste, Canned Soup, Coffee, Potato Chips, Alkaline AA Battery, Facial Tissue, Toilet Paper, Paper Towel, and Disposable Diapers.

Michael Porter associates high market share with cost leadership strategy, which is based on the idea of competing on a price that is lower than that of the competition.

However, customer-perceived quality—not low cost—should be the underpinning of competitive strategy, because it is far more vital to long-term competitive position and profitability than any other factor. So, a superior alternative is to offer better quality vs. the competition.

In most consumer markets, a business seeking market share leadership should try to serve the middle class by competing in the mid-price segment; and offering quality better than that of the competition: at a price somewhat higher to signify an image of quality, and to ensure that the strategy is both profitable and sustainable in the long run.

Quality, however, is a complex concept, consumers generally find difficult to understand. So, they often use relative price, and a brand’s reputation, as a symbol of quality.

The U.S. Sanitary Napkins market had sales of $881 million in 2008.

This market consists of two segments: Pantiliners and Sanitary Pads, with 2008 sales, respectively, of $210 million and $671 million.

However, we have focused our analysis on the Sanitary Pad segment with the pack size 22-36 that had a market share of 37.1%.

Using Hierarchical Cluster Analysis, we tested two hypotheses: (I) That the market leader is likely to compete in the mid-price segment, and that (II) Its unit price is likely to be higher than that of the nearest competition.

However, the data did not support Hypothesis I for both 2008 and 2007 because the market leader “Always Ultra-Thin Maxi Pad with Wings (32 count)” was a member of the premium segment.

Technically, the data for 2008 did not support Hypothesis II, because the runner-up “Always Maxi Pad Ultra-Thin Overnight (28 count” had a unit price of $6.00, compared to the unit price of $5.98 for the market leader. Yet, the two prices are so close that we have concluded that the data did not really negate Hypothesis II.

We found that relative price was a strategic variable, as hypothesized.

A pattern is emerging in price-quality segmentation analysis. In ten of the seventeen studies—that exclude Men’s and Women’s Razor-Blades, Ground Coffee, Toilet Paper, Paper Towels, Disposable Diapers, and Sanitary Pads—the market leader was found to be a member of the mid-price segment, as we have hypothesized.

Also, results in seven markets supported Hypothesis II.

We also discovered four strategic groups in the industry.

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