In case you are wondering what the opportunity cost of our consumer culture is, I suggest it is 234%: the net difference between a tube of Crest or Colgate toothpaste and their lowly competitor: AIM.
There are over 330 million people in the United States; almost all of us use toothpaste. The American toothpaste market is dominated by two major brands: Colgate (36% market share) and Crest (30% market share). That leaves a third of the playing field for all those down-market brands, such as Aquafresh, Ultrafresh, Arm & Hammer, and that 50’s favorite, Pepsodent; plus the niche pastes like Sensodyne, Parodontax, and Pronamel; as well as the preferred choice of the crunchy set: Tom’s of Maine.
I don’t use any of those toothpastes. I use AIM, a reddish gel, manufactured in New Jersey. AIM sells for $1.19 cents per 5.5-ounce tube at my local Target, as opposed to $2.79 for a similar size tube of Colgate or Crest. If you live near a Family Dollar, you can still get AIM for a mere 99 cents.
Surely, AIM must be inferior to Crest or Colgate, since it sells for less than half the price. I asked my hygienist, who informed me that AIM is easily as good as other mass market toothpastes. They all have fluoride, and AIM’s gel consistency is better for teeth and gums than abrasive toothpastes. I also checked online, where an NBC survey of dentists confirmed that AIM is considered equivalent by most dentists, and actually preferred by many.
So if AIM is equally good at less than half the price, it must dominate the market, right? The toothpaste aisle of my Target has rows and rows of Colgate and Crest, in a dizzying array of tube sizes, with a variety of embedded features. On the bottom shelf sits a single-wide stack of AIM.
Why is it that a perfectly good toothpaste that sells for dimes on the dollar of the popular brands has such a small market share, and so little shelf space? The answer is simple. When was the last time you saw an advertisement for AIM?
The next time you buy toothpaste, you can save 234% if you simply reach down to the bottom shelf. Or, choose Crest and Colgate and rack up another victory for Madison Avenue.