The document discusses Colgate Palmolive's new Precision toothbrush and recommendations for its marketing strategy. It recommends a niche marketing strategy targeting the super premium segment rather than mainstream. This would position the Precision as a technologically advanced brush that is more effective at removing plaque and caring for gums. An aggressive advertising campaign and endorsements from dentists are suggested to communicate these benefits to consumers in the targeted niche market.

1. COLGATE PALMOLIVE
THE PRECISION
TOOTHBRUSH

2. CONTENTS
• Problem Statement
• Demand and Market Segment
• Marketing Mix
• Marketing Strategy / Programs
• Recommendation

3. PROBLEM STATEMENT
• Defining the Marketing Strategy for the New Toothbrush – COLGATE
PRECISION
• Positioning
• Branding
• Communication Strategy

4. NATURE OF DEMAND
• Tooth brush market is close to a century old, but last few decades have
witnessed many changes
• Now, there is a shift in demanded benefits
• Cavity Prevention
• Healthier Gums
• Young generation ready to pay for superior toothbrush
• Market is emerging from value and premium range to a third category of
“Super Premium” range – Enhanced Oral Care

5. EXTEND OF DEMAND
• Current US Toothbrush market – US $ 330 MN
• CP’s share – US $ 77 MN
• Market growth – 9.3% per annum since 1987 ($ sale)
• Year 1992 – Market growth – 18% by volume, 21 % by $ sale
• $ growth exceeded volume growth due to emerge of Super
Premium Toothbrush

6. ENVIRONMENTAL CLIMATE
• Political - Relatively insignificant
• Economic
• New entrants appeared in early 90s
• Proctor & Gamble and Smithkline Beecham
• Positioned in the super-premium segment
• Technological
• The new products in late 1980’s & early 1990’s
• Design of the handle and head of the tooth brush
• The action of the bristles
• Super premium toothbrushes - with an emphasis on greater plaque removal
and gum care

7. • Social
• Aesthetic appeal in the late 1980
• The children’s market
• Glow-in-the-dark handles
• Cartoon characters
• New product - technological improvements
• An additional social development - concern for gum health - the baby
boom population
• Cavity prevention was the previous concern - willing to pay more for
products designed for gum care
• Current status and future trend
• The most current technology is the action of the bristles
• Concern for gum health is demonstrated by the current population
• New product offerings to feature technological improvements of
aesthetic improvements

8. COLGATE PRECISION
• Presently in Introduction stage
• Planned promotion for entry into Super Premium segment
• Expected ROI in few years

9. PRODUCT
• The Precision toothbrush is a technical innovation
• Using infrared motion analysis, CP developed a unique brush
with bristles of 3 different lengths and orientations
• Three brush designs evolved with 35% more plaque removing
efficiency
• The brush is also shown to be more effective in reducing gum
disease than the leading brushes, specifically Reach and Oral-B

12. PRICE
Greater discount may be given as reflected in the financial
forecasts

13. PROMOTION
• Under the niche market
• Aggressive advertising campaign - demonstrate technical superiority of the
toothbrush
• Under the mainstream position
• Through financial incentives
• Coupon , buy one get one free
• Through professional channels – Dentists
• Consumer promotions in strong CP market
• Free 5 oz. Tube of Colgate toothpaste with a Precision brush
• 50%-off offer on Colgate toothpaste
• 50 cent. coupon

14. FINANCIAL FORECAST
• Financial analysis indicates a profit over a two year time frame
for both market positions
• The Niche position generates a greater estimated net profit
over two years of $12,527,333
• The mainstream net profit over two years is estimated at
$9,515,333
• In addition, some sales of the new product are anticipated to
come at the expense of sales of other existing Colgate
products

15. • In the niche position, an estimated 35% of sales would come
form other products decreasing Colgate’s overall toothbrush
net profit by $2,507,400 in year one and $3,970,050 in year
two
• In the mainstream position, an estimated 60% of sales would
come from exiting products decreasing Colgate’s overall
toothbrush net profit by $15,044,400 in year one and
$21,133,800 in year two.
• Including cannibalization effect, only the niche market
generates a profit over a two year period

16. BRANDING
• Emphasizing the Colgate name on the new Precision toothbrush
would cause additional cannibalization of the existing Colgate
toothbrushes - estimated at 20%
• Using the Colgate name would be congruent with Colgate’s
strategy to build the Colgate brand equity

17. COMMUNICATION & PROMOTION
• Information that may contribute to success
• Four concept tests conducted among 400 adult professional brush users
(Colgate Plus, Reach, and Oral B)
• The results indicates - consumers were highly motivated by the
Precision toothbrush claims
• Additional in-home usage tests were conducted
• 77% claimed that Precision was much more effective than their current
toothbrush
• Other consumer research revealed that the higher the exposure to the
product the greater consumer acceptance

18. SKILLS AND FINANCIAL RESOURCES
• Colgate Palmolive has spent $243 million to upgrade 25 of its
91 manufacturing plants
• Participated in several strategic acquisitions. E.g. Mennen, a
men’s toiletry company
• Manufacturing capabilities began in China and Eastern Europe
• If needed, some production can be re-directed to
manufacturing sub-contractors which CP currently uses for
other products

19. • CP holds 43 % of the global toothpaste market and 16% of the
global toothbrush market
• Sales have increased 12% to $1.3 billion, accounting for 22% of
CP’s total sales
• Toothbrush sales amounted to $77 million with operating
profit of $9.8 million
• What does this mean?
• Colgate Palmolive, without any doubt, has the means and abilities to
take on the endeavor

20. PROS & CONS OF POSITIONING
MAIN STREAM STRATEGY

21. NICHE MARKETING STRATEGY

22. RECOMMENDATION
• CP would have a strong position against competitors on the
basis of product attributes
• Better product with better performance
• Focus on gum effectiveness brush
• Positioning in Super premium Segment specifically to
therapeutic brushers
• R&D investment concludes Super premium Niche segment is
more consistent than mainstream market for the advanced gum
care

23. IMPLEMENTATION
• Professional endorsement from dentists
• Pursue an aggressive advertising campaign
• Match price-points with other super-premium brands
• Associate a super-premium toothpaste with Precision