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Colgate – Palmolive Company:
The Precision Toothbrush
HARVARD BUSINESS SCHOOL
CASE STUDY
Type Public
Industry Consumergoods
Founded 1806;211yearsago
Founder WilliamColgate
Headquarters 300ParkAvenueNewYorkCity, US
Areaserved Worldwide
Keypeople IanM. Cook (CEO)
Products Cleaningagents
Personalcareproduct
Revenue US$16.034billion(2015)
Numberof employees 37,900(2015)
Website www.colgatepalmolive.com
MAJOR COMTITORS OF CP
Objectives of Case Study are to analyze
Precision
Segmenting Targeting Positioning Communication
Strategies
MARKET SHARE IN 1992
Major New Products in the Super-Premium Toothbrush Segment
Product/
MANUFAC
TURER
Feature Benefit Reason Tag-line Launch
date
SKUs
Oral-B
Indicator
ORAL-B
(GILLETTE)
Indicator
Bristles
Tells you
when to
change
toothbrush
Blue band
fades
halfway.
Dental
heritage
Dental
heritage
The brand
more
dentists use
7/91 4 adult
Reach
Advanced
Design
JOHNSON
&JOHNSON
Angled
neck; raised
rubber
ridges on
handle
Cleans in
even the
hardest-to-
reach places
Slimmed
down,
tapered
head
Feel the
difference
8/91 3 adult
Crest
Complete
PROCTER &
GAMBLE
Rippled
bristle
design.
Handle with
rubber grip
Reaches
between
teeth like a
dental tool
Rippled
endrounded
bristles
Only Crest
could make
a brush this
complete
8/91 (test)
9/92
(national)
10 adult
Aquafresh
Flex
SMITHKLINE
BEECHAM
Pressure
sensitive,
flexible
neck linking
brush and
Prevents
gum
irritation
Flexes as
you brush
For gentle
dental care
8/91 (Flex)
9/92 (line
extension)
6 adult
and 1 child
CONSUMER BEHAVIOUR
CONSUMER BEHAVIOUR
CHANGES IN CONSUMER BEHAVIOR
• Customer choice changed from Performance benefits rather than
price.
• Brand choice-Feature, comforts and professional recommendations.
• New products-Aesthetic features and technical performance
improvement.
• Customer preference-Soft bristle from firm bristle.
• Toothbrush replacement frequency --once in 8.6 months in1990
to 7.5 months in 1991
COMPETITOR
TOOTHBRUSH BRAND PRICES-1992
COMPETITOR
PRINCIPAL TOOTHBRUSH BRAND PRODUCT LINES-AUG 1992
COMPETITOR
PRINCIPAL TOOTHBRUSH BRAND UNIT TAND DOLLAR MARKET SHARES-1989-1992E
Positioning of Colgate Precision Toothbrush
The position of the Precision toothbrush could be
niche
or
mainstream?????????
The Table outlines how these unit volumes
would reach the consumers
Launch of Precision in Niche Market
PROS
• New market for Colgate in Super Premier brand.
• No SKU’s needed to be dropped.
• If failure of the product ,there will be no harm to
present market of Colgate.
• It could command 15% price premium due to Colgate
brand image and can capture 3% of the total market
share of USA.
CONS
• Per unit cost of the precision is high.
• If placed in mainstream market ,it could
capture 10% of the market share .Very
high in comparison to position it to niche
market.
• Less revenue generation.
Launch of Precision in Mainstream Market
PROS
• Most retail stores are under a mainstream position
rather than a niche position.
• Greater proportion of sales would occur through mass
Marketing.
• It will generate more revenue and capture larger market
Share and volume in comparison to niche market.
• It would in return increase name recognition for
Colgate.
CONS
• A mainstream position would probably lead to the reduction
and removal of one or more SKU’s.
• The prices for the Precision and other brushes would be equal.
• Equal prices would then lead to increased competition, which
in return could cause prices to go up.
• It could also lead to the cannibalization of Colgate-Palmolive’s
other super-premium toothbrush, the Colgate Plus.
BRANDING
COLGATE PRECISION
OR
PRECISION BY COLGATE??????
• Executives believed that Product should stand alone and the
precision brand name should be emphasized.
• Stressing Precision as opposed to Colgate would limit the extent
of cannibalization of Colgate Plus.
• Emphasizing the Colgate name on the new Precision toothbrush
would cause additional cannibalization of the existing Colgate
toothbrushes - estimated at 20%.
TECHNIQUES USED FOR BRANDING
AND ADVERTISING OF
Free 5 oz. tube of Colgate
toothpaste with the purchase
of a Precision brush
Used dentists to sample
consumers since
professional endorsements
In-home usage tests50%-off offer on any Colgate
toothpaste with a 50¢ coupon
on the Precision brush
Consumer research
Concept and tests
RECOMMENDATION
• Product should be launched in niche market in starting
and after sometime in mainstream market because it
will give long term profit.
• As the Precision gains popularity, CP should use some
of the advertising and marketing expenditures for
Premium lines to advance Super Premium brush in
the mainstream.
• Capture the market share away from the competitor in
both Super Premium and Premium lines by pricing
Super Premium product below the competitors.
• Keeping price low will help in to serve more consumer.
• Advertised as a better brush in comparison to its close
Competitors.
• Target therapeutic and cosmetic brushers.
• Promotion-invest industry-standard amounts of capital
for the new toothbrush promotion target youth and
dentist majorly.
DISCLAIMER
Created by Deep Mistry SVNIT Surat, during a marketing
internship under Prof. Sameer Mathur, IIM Lucknow.

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Colgate's Precision Toothbrush: Launching a Super-Premium Product into the Mainstream

  • 1.
  • 2. Colgate – Palmolive Company: The Precision Toothbrush HARVARD BUSINESS SCHOOL CASE STUDY
  • 3. Type Public Industry Consumergoods Founded 1806;211yearsago Founder WilliamColgate Headquarters 300ParkAvenueNewYorkCity, US Areaserved Worldwide Keypeople IanM. Cook (CEO) Products Cleaningagents Personalcareproduct Revenue US$16.034billion(2015) Numberof employees 37,900(2015) Website www.colgatepalmolive.com
  • 5. Objectives of Case Study are to analyze Precision Segmenting Targeting Positioning Communication Strategies
  • 7. Major New Products in the Super-Premium Toothbrush Segment Product/ MANUFAC TURER Feature Benefit Reason Tag-line Launch date SKUs Oral-B Indicator ORAL-B (GILLETTE) Indicator Bristles Tells you when to change toothbrush Blue band fades halfway. Dental heritage Dental heritage The brand more dentists use 7/91 4 adult Reach Advanced Design JOHNSON &JOHNSON Angled neck; raised rubber ridges on handle Cleans in even the hardest-to- reach places Slimmed down, tapered head Feel the difference 8/91 3 adult Crest Complete PROCTER & GAMBLE Rippled bristle design. Handle with rubber grip Reaches between teeth like a dental tool Rippled endrounded bristles Only Crest could make a brush this complete 8/91 (test) 9/92 (national) 10 adult Aquafresh Flex SMITHKLINE BEECHAM Pressure sensitive, flexible neck linking brush and Prevents gum irritation Flexes as you brush For gentle dental care 8/91 (Flex) 9/92 (line extension) 6 adult and 1 child
  • 10. CHANGES IN CONSUMER BEHAVIOR • Customer choice changed from Performance benefits rather than price. • Brand choice-Feature, comforts and professional recommendations. • New products-Aesthetic features and technical performance improvement. • Customer preference-Soft bristle from firm bristle. • Toothbrush replacement frequency --once in 8.6 months in1990 to 7.5 months in 1991
  • 12. COMPETITOR PRINCIPAL TOOTHBRUSH BRAND PRODUCT LINES-AUG 1992
  • 13. COMPETITOR PRINCIPAL TOOTHBRUSH BRAND UNIT TAND DOLLAR MARKET SHARES-1989-1992E
  • 14. Positioning of Colgate Precision Toothbrush The position of the Precision toothbrush could be niche or mainstream?????????
  • 15. The Table outlines how these unit volumes would reach the consumers
  • 16. Launch of Precision in Niche Market PROS • New market for Colgate in Super Premier brand. • No SKU’s needed to be dropped. • If failure of the product ,there will be no harm to present market of Colgate. • It could command 15% price premium due to Colgate brand image and can capture 3% of the total market share of USA.
  • 17. CONS • Per unit cost of the precision is high. • If placed in mainstream market ,it could capture 10% of the market share .Very high in comparison to position it to niche market. • Less revenue generation.
  • 18. Launch of Precision in Mainstream Market PROS • Most retail stores are under a mainstream position rather than a niche position. • Greater proportion of sales would occur through mass Marketing. • It will generate more revenue and capture larger market Share and volume in comparison to niche market. • It would in return increase name recognition for Colgate.
  • 19. CONS • A mainstream position would probably lead to the reduction and removal of one or more SKU’s. • The prices for the Precision and other brushes would be equal. • Equal prices would then lead to increased competition, which in return could cause prices to go up. • It could also lead to the cannibalization of Colgate-Palmolive’s other super-premium toothbrush, the Colgate Plus.
  • 21. • Executives believed that Product should stand alone and the precision brand name should be emphasized. • Stressing Precision as opposed to Colgate would limit the extent of cannibalization of Colgate Plus. • Emphasizing the Colgate name on the new Precision toothbrush would cause additional cannibalization of the existing Colgate toothbrushes - estimated at 20%.
  • 22. TECHNIQUES USED FOR BRANDING AND ADVERTISING OF
  • 23. Free 5 oz. tube of Colgate toothpaste with the purchase of a Precision brush Used dentists to sample consumers since professional endorsements In-home usage tests50%-off offer on any Colgate toothpaste with a 50¢ coupon on the Precision brush Consumer research Concept and tests
  • 24. RECOMMENDATION • Product should be launched in niche market in starting and after sometime in mainstream market because it will give long term profit. • As the Precision gains popularity, CP should use some of the advertising and marketing expenditures for Premium lines to advance Super Premium brush in the mainstream. • Capture the market share away from the competitor in both Super Premium and Premium lines by pricing Super Premium product below the competitors.
  • 25. • Keeping price low will help in to serve more consumer. • Advertised as a better brush in comparison to its close Competitors. • Target therapeutic and cosmetic brushers. • Promotion-invest industry-standard amounts of capital for the new toothbrush promotion target youth and dentist majorly.
  • 26. DISCLAIMER Created by Deep Mistry SVNIT Surat, during a marketing internship under Prof. Sameer Mathur, IIM Lucknow.