colgate palmolive ppt

2. COLGATE-PALMOLIVE
A GLOBAL LEADER IN THE HOUSE HOLD
AND PERSONAL CARE PRODUCTS .

3. SITUATION!
In August 1992,Colgate-
Palmolive(CP)was poised to launch a
new toothbrushin theUnited States,
tentativelynamed COLGATE
PRECISION.
SusanSteinberg,PrecisionProduct
Manager has to recommend
Positioning,Branding and
communicationStrategies for “The
Precision”.

4. Prior to finding solutions tothe problem, an extensive analysis on the
Company’s strength and weakness must bedone. This helps us to knowthe
potential areas of improvement and the innerstrengths.
• Was a global leader in the house
hold and personal careproducts
• Introduced 275 new products
world wide
• Held the numberoneposition in
the U.S retail toothbrush market
with a 23.3% volume share.
*Data w.r.t 1991 sales statistics
• Was unable toachieveproper credibility
from the dental association on its
products whencompared to its
competitor ORAL-B
• Introduction ofnewproducts may result
in cannibalization of other products like
colgate plus.

5. PRODUCT
SEGMENTATION
In the 1980’s,Industry
executives divided the
Toothbrush category into
two segments
• Value
• Professional
The late 1980’s saw the
emergence of another
category called super
premium brushes

6. ANALYZING CONSUMER BEHAVIOUR
• Consumers were willingto pay a
premium for the new products
addressing issues regarding the
healthof their gums
• 48% consumers claimedto change
their brushes at least every three
months
• Consumers chose their brand based
on features, comforts and
professional recommendations

7. MAIN REASON %
Fits comfortably 63
Getting at hard to
Reach places
52
Bristles of Right
softness
46
Bristles of right
firmness
36%
The table gives a broader view on the priority of choice of
Brand based on their effectiveness and functionality
Continued…

8. ORAL-B
JOHNSON&
JOHNSON–REACH
BRAND
P&G’S CREST
AQUAFRESH FLEX

9. TAKING NOTES OFCHALLENGES FROMCOMPETITORS
• Oral-B has heavy professional endorsement and is known
as “The dentist’s toothbrush” thus giving a tough match in
the competition.
• J&K’s Reach-has excellent innovations like-a beveled
handle to help consumer brush at 45 % angle.
The Brand has scheduled the Launch of ‘Reach Between’
on September 1992.This has to bekept in mind-after few
months- Precision has to launched
• P&G ‘s Product claims tohavethe ability toreach
between the teeth upto 37% farther than leading brands.
• Smithkline Beechman’sAquaFresh Flex had flexible
handles and allowed gentle brushing. TheBrand has good
promotional plans to comeup

11. Pointsto Ponder!
 Growing competitionincreasedthe
featuredandvalue ofconsumer
promotionevent.
 Retailadvertisingfeaturesandin
storedisplaysincreasedtoothbrush
sales
 WhenColgatetoothbrushwere
combined withColgatetoothpaste,
the toothbrushsalesincreased by
170%
 The CPtoothbrushline held25%to
40%of thecategoryshelf spacein
moststores.
 22%of alltoothbrusheswere
expectedto bedistributedto
consumersbydentist-with
dedicatedsalesforce-OralB
dominatedthis Market.

12. PRODUCT DESIGN
The longer outerbristles
cleanedaroundthegum
line.
The long innerbristles
cleaned between theteeth
Theshorter bristles
cleaned the teeth
surface
The Brushachieved 35%
increasein Plaqueremoval
comparedtootherleading
toothbrushes
A superior,technical,
plaqueremoving
device.

13. POSITIONING!
Precision wasdeveloped with the
objective of creating best brush
possible and as such becoming a top-
of-the –range product. Now how do
we position it?

14. We hadtwo choices!
NICHE POSITIONING
STRATEGY
MAINSTREAM
POSITIONING
STRATEGY

15. NICHE POSITIONING STRATEGY
• When positioned as Niche
product ,it would target at
consumers concernedabout
gumdiseases.
• As such,it could command a
15% price premium over
ORAL-B and would be
expectedto capture 3% of the
U.S toothbrush market by the
end of 1st year following its
launch.
• No SKU’sNeededtobe
dropped!
• If Precision is positioned as a Mainstream
brush, Precision would capture 10% of the
market share at the end of 1st year
following its launch.(Veryhigh when
comparedwith Nichepositioning)
• Thevolume shares when positioned as
mainstream would be 10% in 1 year when
comparedto5% when positioned as
Niche product!

16. MAINSTREAM POSITIONING STRATEGY
• Raised concerns about ‘CANNIBALIZATION’
of Colgate plus and about pressure on
Production Schedules that had been
developed for Niche positioning.
• Production capacity increases required
10months lead-resulting in inadequate
supply of product.
• Positioning Precision as a mainstream
product with 7 SKU’s would probably require
dropping oneormore existing SKUs.
• Mainstream was more
appealing as it proclaimed
largermarket share & volume
shareat the endof1 year after
launch.
• Greaterproportion of sales
would occurthrough mass
merchandisers and club stores.

17. BRANDING!
The Debate whether the brush should
be known as“Colgate Precision” or
“Precision By Colgate”????

18. • Executives believed that Product
should stand alone and the
PRECISION brand name should be
emphasized.
• Stressing Precision asopposed to
Colgate would-limit the extent of
Cannibalizationof Colgate plus.
• It was estimated ,both under
mainstream and niche positioning
scenarios, the cannibalization figures
For Colgate plus would increase by
20% if the Colgate brand name was
stressed.

19. TESTREULTS WEREAS FOLLOWS
• Thetoothbrush’s feature of preventing
Gum disease motivated the greatest
purchase intent among test consumers.
• Additional consumerresearchrevealed
that 55% of test consumers found
Precision to bevery different from their
currenttoothbrushes.
• Theresearch also revealedthat the more
the consumers weretold about Precision
and howit worked, the greater the
enthusiasm for the product.

20. • However,the clichéd look of
the brush put the consumers in
dilemma.
• Also it was difficult to translatethe
message of greater plaque removal
with a broad consumer appeal,
since few consumers
acknowledged that they might
have gum disease.

22. POSITIONING:
• InitiallyPositioning Precision as Niche Toothbrush and
later broadening to mainstream positioning would help
the product gainsufficient recognition by avoiding
cannibalizationand would ensure additional capacity once
it enters the mainstream.
• Broadening into the mainstream positioning would
enhance greater proportion of sales which would now also
occur through mass merchandisers and clubstores apart
from the food and drug stores.

23. BRANDING:
• “Precision By Colgate "would be more prominent as it
would reduce cannibalizationof Colgate Plus-which
is the bread and butter of CP’s toothbrush line and
secure its market position.
• Placing The Precision at the center of the Brushes in
the storage shelves wouldensure easy acceptance
due to the prevalence of the Brand at the same time-
give it a unique stand.

24. COMMUNICATION STRATEGY:
.
Investinga littlemore on
Advertising and Promotion
would notdo much harm as it
shallgive a head start to this
potentialproduct
There must be several
Consumer promotions to back
the launchfor the mainstream
positioning asthis w attract alot
more potential buyers.

25. Since sampling would be criticalto Precision’s success, it
would be better to use Dentists to sample consumers
since professional endorsements were more credible.

26. Spending 75%of all advertising dollors of CP’s category
spending for Precision was essentialbecause it ensured
Precision wasable to Reach its Potential consumers through
extensive advertising.
Thiswould not be a threat for CP’s Colgate plus asit has its
market share secured by the Colgate’s Brand name,which is
not the Case with Precision.

27. BY DHRUBAJYOTI MAJUMDER
Heritage institute of Technology, KOLKATA
UNDER SUMMER INTERNSHIP PROGRAM BY
PROF.SAMEER MATHUR-
IIM LUCKNOW