A brief description of the situation and challenges related to Precision toothbrush and its launch in the market

1. CASE ANALYSIS
THE PRECISION
TOOTHBRUSH

2. COLGATE-PALMOLIVE
 American worldwide consumer products company
 Global Leader in household and personal care
products(In 1991,held 43% of the world
toothpaste and 16% of the world toothbrush
market)

3. COMPANY BACKGROUND
 In 1991,held 43% of the world toothpaste and
16% of the world toothbrush market.

4. Susan Steinberg- Precision
product manager

5. SITUATION
 Colgate-Palmolive intended to launch a new
toothbrush in the US called Colgate Precision –
technologically superior toothbrush.
 Susan Steinberg had to manage the entire new
product development process.
 Susan had to recommend positioning, branding
and communication strategies.

6. •IN 1991, THE U.S ORAL CARE MARKET WAS IN
$2.9 BILLION IN RETAIL SALES.
GROWTH AT AN ANNUAL RATE OF 6.1% SINCE
1986.

8. PRODUCT SEGMENTS
 Toothbrush Category divided into 3 segments:-
1. Value
2. Professional
3. Super-Premium
 Players dominating market(1992):- Colgate-Palmolive ,
Johnson and Johnson and Oral-B
 New Entrants:- P&G, Smithkline Beecham
 Products focused on technical performance
improvements.

10. ANALYSIS OF CONSUMER BEHAVIOR

11.  Consumer research of CP
indicated baby boom
generation are likely to pay
premium prices for gum-
health.
 An estimated 82% of
toothbrushes bought were
unplanned but very few
bought them on impulse.

12.  Brand choice was based on features, comfort and
professional recommendations

13. CONSUMERS SEGMENTATION

14. COMPETITIONS
1.Competitors were listed on the following basis
 Product Prices
 Number and types of SKUs (Stock keeping units).
2.Oral-B thought of competing in all levels of oral care to be the leader.
3. It relied heavily on professional endorsements. Known as ‘Dentist’s
Toothbrush’

17. OTHER COMPETITORS WERE LEVER, PFIZER AND SUNSTAR.
Johnson and
Johnson
introduced
Prevent, a
brush with
flexible handle
helping
consumers
brush at a 45
degree angle
P&G
extended
company’s
toothpaste
brand with
Crest
Complete
which had the
ability to reach
between the
teeth upto
37% farther
than flat brush
Aquafresh
Flex, an
extension
of
Smithkline
Beecham
had
flexible
handles for
gentle
brushing.

19. STEPS TO PROMOTE AND DISTRIBUTE
 A typical CP toothbrush display
as it increased the sails.
 Toothbrushes free with
toothpaste.
 Locating Colgate in the middle of
shelf space to maximize retail
sales.
 22% of the toothbrushes to be
distributed to dentists.
 Television Ads.

22. PRODUCT DESIGN AND TESTING
 Mission:- “ Develop a superior, technical plaque-
removing device”.
 Established a task-force with executives from R & D,
Marketing, dental professionals and outside consultants.
 Development process was managed by Steinberg with
the following goals.

23. GOALS OUTCOMES
 Understanding various techniques of
consumers brushing their teeth.
 Tested the between-teeth access of the
designs.
 Index established to score plaque-
removal efficiency.
 Creating bristle configuration and
handle design offering maximum
plaque-removing efficacy.
 Determination of efficacy and
acceptance through clinical and
consumer research.
 Brush was usually ineffective at
removing plaque from gum line and
between teeth.
 New design was superior than Oral-B
and Reach in accessing front and back
teeth.
 Test started to measure percentage of
plaque pre- and post-usage.
 3 designs that allowed freer movement
of bristles were found. New product
was established to remove 35% more
plaque.
 Product usage tests and research in
dental professional focus groups
carried out to determine acceptance
of precision.

24. SOLUTIONS
 CP senior management decided to launch Precision in early 1993
 It was to be priced in super-premium segment
 Distribution through the same channels as Colgate Plus.

26. POSITIONING
MAINSTREAM
NICHE

27. NICHE MARKETING
MAINSTREAM MARKETING
 Command 15% price
premium over Oral-B.
 Expected to capture 3% of
the toothbrush market in U.S
 Volume shares
Year 1-3%
Year 2 -5%
 Capture 10% of market in
U.S by the end of the first
year.
 Volume shares
Year 1-10%
Year 2- 14.7%

28. • STEINBERG DEVELOPED FINANCIAL
PROJECTIONS FOR BOTH SCENARIOS:-
1.VOLUMES
2.Capacity and investment costs

29. CONCERN ASSOCIATED WITH MAINSTREAM
POSITIONING
 Lead to inadequate supply of product as it requires 10 months’
lead time.
 This would require dropping one or more existing SKU’s
NONE OF THESE ISSUES ARISED WITH NICHE MARKET
POSITIONING
Steinberg reasoned that
•As a niche product it would be carried primarily by food and drug
stores
•Under mainstream launch scenario more sales would occur
through mass merchandisers and club stores.

31. BRANDING
 Product was better
off standing alone
as emphasizing
precision would
limit the
cannibalization of
colgate plus.

32. COMMUNICATION AND PROMOTION
•4 concept tests among 400 adult brush users.
•Tactic:- To use professional endorsements for
establishing credibility.

34. CONCERNS
 Brush looked unusual and test participants
sometimes had mixed first impressions.
 The benefit of reduced gum disease was difficult
to translate into message.

35. RESULTS
 Consumers were highly enthused by toothpaste
claims.
 Once tried, consumer intent to purchase rose
dramatically.
 Sampling critical to Precision’s success .-Steinberg

36. INFERENCES
 Steinberg believed that the launch
of Precision would enable CP to
increase its overall share of trade
advertising features.
 Steinberg believed under niche
scenario, 3 million brushes could
be channeled through dental
professionals versus 8 million
under mainstream scenario.

37. BREAK-EVEN ANALYSIS
With Table-E and volume estimates
Hoped to develop a pro-forma income statement to
know the full potential
Whether (Retail price*unit volumes) sold was
greater than or equal to the investment?

38. CONCUSION
 Steinberg believed Precision was more than a Niche
product
 A marketing mix was developed to enable Precision to
reach its true potential yet acceptable to Burton and other
colleagues, particularly Colgate Plus product manager.

39. DISCLAIMER
This presentation is made
to fulfill requirements for
the summer internship
under Prof. Sameer
Mathur.
NAMOONA NAYAK
IIIT,BBSR