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Colgate-Palmolive's Precision Toothbrush: Niche vs Mainstream Positioning
- 1. Colgate-Palmolive Journey of the Precision toothbrush
- 2. What it does? Colgate-Palmolive is an American worldwide consumer products company focused on the provision of household, health care and personal products, such as soaps, detergents, and oral hygiene products.
- 3. Company Background Global leader in household and personal care products Sales $6.06 billion Profit $2.76 billion R&D $114 million Advertising $428 million 1991
- 5. Product Segments Value Professional Super Premium Toothbrushes varied by bristle type and by head size.
- 6. Consumer Behavior Personal habits Dentist recommendation Individual Needs Oral Hygiene
- 7. Competition 0 5 10 15 20 25 30 Oral B Colgate J & J Volume(%) Value(%)
- 9. Product Design Mission: To “develop a superior technical, plaque removing device”. Result: Triple action brushing effect: Outer long bristles to clean around gum line Inner short bristles cleaned between the teeth Inner long bristles cleaned the teeth surface
- 10. Problem? Defining the Marketing strategy i.e. positioning, branding, and communication strategies for C-P’s new toothbrush: Colgate Precision
- 11. How to position the product? Niche positioning : Consumers concerned about gum disease Mainstream positioning: Appeal of the most effective brush in the market
- 12. Factors to be considered Volumes Niche: 3% Mainstream: 10% Total volume share
- 13. Capacity and investment costs Factors to be considered Investment cost Annual Capacity Depreciation time Tufters $500,000 3 million units 15 years Handling Molds $300,000 7 million units 5 years Packaging $150,000 40 million units 5 years Tufters could be used if Precision is Niche Positioned and Packaging if is Mainstream Positioned.
- 14. Production Costs and Pricing Factors to be considered Niche: $2.13 Mainstream: $1.85 List Price of Colgate Precision Concerns: •Cannibalization of Colgate plus •Inadequate supply Niche Mainstream Food stores and Drug stores Mass merchandis ers and club stores
- 15. Branding Names tested: Colgate Precision, Colgate System III, Colgate Advantage, Colgate 1.2.3, Colgate Contour, Colgate Sensation, and Colgate Probe. Colgate precision was deemed favorable by 49% concept acceptors and appealing by 31%.
- 16. Communication and Promotion The toothbrush would prevent gum disease motivated the greatest purchase intent among test consumers.
- 17. Niche positioning • Easy transition in the product life cycle from niche to mainstream strategy • Less erosion of Colgate Plus • CP would face less competition •Entry into superior premium toothbrush where CP holds no position • Less contribution to net profit in future years
- 18. Mainstream positioning • Possible increase in sales •Unsatisfied demand could create the perception of a Hot product which may increase the sale • Cannibalization of Colgate plus • May require dropping one of slow moving product in the product line • More competition •Possible pressure on production
- 19. Recap
- 20. Disclaimer Created by Saswat Prusty, Manipal Institute of Technology, during a marketing internship by Prof. Sameer Mathur, IIM Lucknow. P.S. I am on the right :p