The global electric toothbrush industry is essentially duopolistic in nature and is dominated by Oral-B (Procter & Gamble) and Philips. This industry has excellent potential to grow given the fact that several research studies have pointed towards the superiority of electric toothbrushes at reducing plaque and gingivitis over manual toothbrushes. However, the industry is seeing new innovative brands like Goby and Quip that are coming out with improved offerings and new features like a smart timer and different brush modes that encourage better oral hygiene habits. Our stock pick for the day is an oral care company that is offering the highest quality of electric toothbrushes, equipped with sonic technology and cutting-edge features at the most affordable price point – Brüush Oral Care Inc. (NASDAQ:BRSH).
Brüush is an oral care brand that manufactures electric toothbrushes designed to maintain good oral hygiene. The company’s electric toothbrush kit also includes 3 brush heads, a magnetic charging stand, and, and travel case for a sum of $79. Its toothbrush heads are available through a subscription-based service, which sends a 3-pack of brush heads to subscribers every 6 months for a cost of $18 ($6/head). The company’s brush subscription is designed to provide an easy solution for customers wanting to maintain a healthy oral care routine without the hassle. Brüush sells its premium and luxury-looking electric toothbrushes to consumers in North America. The company’s highly reasonable pricing is aimed at disrupting the electric toothbrush market. Management also intends to expand their portfolio by launching additional subscription-based consumable oral care items, including toothpaste, mouthwash, dental floss, a whitening pen, and a kid-friendly electric toothbrush. The company has offices in Vancouver, British Columbia and Toronto, Ontario.
Value Proposition & Target Customers
Given the clearly visible market opportunity in a duopolistic market, Brüush launched an electric toothbrush that makes the act of switching from manual to electric brushes far more cost effective and appealing. Using a direct-to-consumer business strategy, the company cut out the middleman while providing consumers with a premium electric toothbrush at a lower cost than a comparable model from the competition. The Brüush Toothbrush has several features, including sonic technology that delivers over 31,000 brush strokes per minute, six different cleaning modes, and a smart timer that pauses every 30 seconds to remind the user to move the toothbrush to a different quadrant of their mouth and then shuts off after two minutes. The brush also features a rechargeable battery that lasts an astounding four weeks on a single charge. They also use extra soft DuPont Tynex bristles to make their brushes more comfortable.
Brüush’s subscription program allows customers to avoid pointless store visits while guaranteeing that they can regularly replace their brush heads to support good oral health. The subscription service automatically sends a three-pack of brush heads every six months. In addition, they send a reminder email to subscribers every two months to let them know that it is time to replace their brush heads to increase usage and frequency. Customers have the option to easily cancel their subscription at any time, but the company has a strong hold on its customers and churn rate is nominal. The management has worked towards making the brushes among the most fashionable-looking brushes on the market as they are available in three standard colors, black, white, and pink, as well as several trend-driven seasonal hues that are released in limited quantities.
Large Addressable Market
The global electric toothbrush market, valued at $2.7 billion in 2019, is anticipated to grow at a CAGR of 5.7% from 2020 to 2030, reaching $4.8 billion. One of the major factors driving the electric toothbrush market is the growing awareness of the advantages of using smart toothbrushes. According to numerous studies, these toothbrushes are more efficient than manual toothbrushes. Unhealthy food habits such as high consumption of sugary foods, chewing tobacco, and alcohol consumption can negatively impact a person’s oral health. Due to the rising demand for smart brushes, these factors are crucial to expanding the electric toothbrush market. Other factors behind this market’s expansion include a rising geriatric population, unhealthy eating patterns, a rising number of oral hygiene initiatives, and growing awareness of the advantages of using electric toothbrushes.
Strong Branding & Sales Strategy
Building a distinctive and personable brand identity that appeals to a younger audience, including Generation X, millennials, and Generation Z has helped Brüush set itself apart from the competition. This is one of the biggest reasons why the company has been able to retain as many as 28,000 subscribers to date and has an ambitious goal of 1 million subscribers in the near future. The company’s brand identity was built by producing supercharged content that aligns with its goal of shaking up the conventionally uninteresting oral care category and using vivid colours and strong expressions. Their website, paid media initiatives, and social media platforms use this content. Along with their campaign assets, they also produce omnichannel content through organic seeding programs and customer enthusiasm, resulting in a consistent flow of user-generated content and brand mentions. By combining creative pitching, tactical product seeding, and reactive public relations, earned media exposure has also demonstrated success in establishing the brand.
In 2021, the company received more than 200 press placements that helped build its brand, including those in the Wall Street Journal, Rolling Stone, Vogue, Refinery29, Allure, and New York Times. As a result of these prestigious publications linking to their website, key performance indicators increased on their website for up to 48 hours after new placements, which helped with search engine optimization. Furthermore, given their emphasis on luring customers between 18 and 45, they are very active on social media. They also have celebrities like Kevin Hart endorsing their brand which is bound to have a long-term impact on subscriptions. After building a strong community, Brüush intends to connect with its target market on a deeper level and increase brand engagement. It is worth highlighting that their primary social media efforts have been concentrated on Instagram, where they currently have over 28,000 followers. The team also has worked with over 200 on-brand influencers as part of their social media strategy, ranging from micro-influencers to well-known figures.
The electric toothbrush market can actually be compared to the razor market in terms of its general dynamics. There was a time when the razor industry was also a duopoly, dominated by Gillette (Procter & Gamble) and Schick and was eventually disrupted by the likes of Harry’s and Dollar Shave Club, with their direct-to-consumer approach and focus on millennials. Brüush is in the exact same position and could pose a formidable challenge to the duopoly of Philips and Oral-B (again Procter & Gamble). The company’s latest funding is expected to help drive more and more subscribers which are a source of recurring revenues. Apart from the North American market, they could also export to nations with less intense competition. The company is also expected to introduce their supplemental oral care products, including toothpaste, mouthwash, dental floss, whitening pen, and electric toothbrush made specifically for children, in 2022 and beyond. With these new products, they have the chance to broaden the number of touch points in their retention funnel, strengthen their bonds with current customers, raise the average order value, and boost their monthly recurring revenue. In a nutshell, Brüush’s long-term objective to ‘own the bathroom’ could easily become a reality which is why we are highly bullish on the company and believe it to be an excellent long-term investment.