This presentation has been created in a case study under Prof. Sameer Mathur.

1. THEPRECISIONTOOTH-
BRUSH

2. ABOUT THE COMPANY
Colgate-PalmoliveCompanyis
anAmericandiversifiedmultination
al corporationfocusedonthe
1.Production,
2.Distribution,&
3.Provision
ofhousehold,healthcare and
personalproducts,suchas
soaps,detergents,andoral
hygieneproducts.
(includingtoothpasteandtoothbru
shes).

4. • In 1806,WilliamColgateintroducedstarch,soap andcandle
factoryon DutchStreetin NewYork Cityunder thenameof
"WilliamColgate&Company".
• In 1857, WilliamColgatediedandthe company wasreorganized
as "Colgate& Company" under themanagementof Samuel
Colgate,his son.
• In 1873,thefirmintroducedits firsttoothpaste,an aromatic
toothpastesold injars.
History

5. • His company sold the first toothpaste in a tube, Colgate Ribbon Dental
Cream, in 1896.
• In 1928, Palmolive-Peet bought the Colgate Company to create the
Colgate-Palmolive-Peet Company.
• In 1953 "Peet" was dropped from the title, leaving only "Colgate-
Palmolive Company", the current name.
• Today Colgate has numerous subsidiary organisations spanning 200
countries, but it is publicly listed in only two, the United States and
India.
History (contd.)

6.  In 1991 the company witnessed salesof $6.06 billion with a gross
profit of $2.76 billion.
 CP’s five year plan 1991-1995 isto focus on core consumer products
with improved efficiencies in manufacturing and distribution. It also
entered into new geographic markets mainly emphasizing in new
product launches.
 With the development inOral care division, Precision product
manager SusanSteinberg had recommended positioning, branding
and communication strategies to GM Nigel Burton.
Background

7. SALES BACKGROUND

8. • In 1991, the U.S. Oral Care market was $2.9 billion in retail
sales withan annualgrowth rate of 6.1% since 1986.
• Toothpaste accounted for 46% of thismarket, with mouth
rinses 24%, toothbrushes 15.5%, remainingwithdentalfloss
and other products.
U. S MARKET SCENARIO

9. U. S MARKET SCENARIO

10. • Toothbrush market is categorized into 3
segments:
Professional
• Better quality
• Price– $1.59
to $2.09
Super premium
• Better design
• Price- $2.29 to
$2.89
Value
• More
economy
• Price- $1.29

11. Main reasonfor using brand Percent of consumers
•Fits most comfortably in my mouth 63%
•Best for getting at hard-to-reach places 52%
•Thebristles are the right softness 46%
•Thebristles are the right firmness 36%
•My dentist recommends it 35%
•Important part of oral regimen 30%

12. PLAN
• Launching of new products.
• Entry into new geographic
market.
• Improved efficiencies in
manufacturing & distribution.
• Continuing focus on core
consumer product

14. • The Precision toothbrush was a technical
innovation. In laboratory experiments,
researchers used infrared motion analysis to
track consumers’ brushing movements and
consequent levels of plaque removal. With
this knowledge and through computer aided
design, CP developed a unique brush with
bristles of three different lengths and
orientations for overall better cleaning.
THE PRECISION TOOTH-BRUSH
PRODUCT

15. PRICING STRATEGY

16. PROMOTION

17. Advertising & Promotion Expenditures
for Colgate-Palmolive Toothbrushes
1989-1992E

18. PLACE

20. • Was a global leader in the house holdand personal care
products.
• Introduced 275 new products world wide.
• Heldthe numberone position in the U.S. Retail toothbrush
market witha 23.3% volume share.

21. • Was unableto achieve proper credibility from thedental
association on it’s products whencompared to it’s competitor
ORAL-B.
• Introduction of new products may result in cannibalizationof
other products likeColgate plus.

22. • 46%ofconsumersegmentareconcernedaboutthe
healthoftheirgum.
• Willingnessofcustomertopaypremium,toeradicate
thegumproblem.

23. • Threat of new entrantsof toothbrushcompany.
• Offeringof incentiveprograms by competitorcompany.

24. COMPETITION

26. Positioning
Precision was developed with the objective of creating best brush
possible and as such becoming a top of the range product.
The Niche positioning –
• Targets specific consumers.
• It was expected that
Colgate would command
15% price premium over
the competitors.
The Mainstream positioning
• It would have a broader appeal of
being the most effective brush
available on the market.
• As a mainstream brush, Precision
could capture 10% of the market.

27. NICHE
POSITIONINGPros Cons
• Niche could later be broadened to a
mainstream position as additional capacity
came on line. This would be an easy transition
in the product life cycle.
• Less erosion of Colgate Plus. The product are
more isolated.
• Entry into new superior toothbrush market
which CP currently holds no position.
• CP would face less competition.
Less contribution to net profit in future years.

28. MAINSTREAM
POSITIONINGPros Cons
• Unsatisfieddemandcouldcreate the
perceptionofa hotproduct,whichmay
increasesale
• Greater proportionofsaleswouldoccur
throughmasmerchandisersandclub
stores
• RaisedconcernsaboutCannibalization
ofColgatePlusandaboutpressureon
productionschedulesthathadbeen
developedfor Nichepositioning
• Productioncapacityincreasesrequired
10monthslead–resultingin
inadequatesupplyofproducts.

29. • Steinberg viewedPrecision was morethan a simplelineextension.
• Determinedhow precision should be positionedfollowingthe path
of development,testing,pricing and communication.
• The case brieflyoutlinedabout U.SOral Care Market.
• Colgate-Palmoliveshould bepositionedin theniche marketing
category during itsintroductory adgrowth lifecycle stages.
• Thereafter,during theproduct’s maturity,Precision should be
repositionedto themainstreammarket.

30. Created by RishabhSingh, HBTU Kanpur, duringa
marketing internshipby Prof. Sameer Mathur, IIM
Lucknow