Case Study : Colgate Palmolive , Marketing Analysis

1. Colgate Palmolive :
The Precision Toothbrush

2. Present Situation
• Despite working on the toothbrush
development since years, the company now
faces a highly competitive market and
substantial new product activity

3. Issues to work on
• Positioning strategies
• Branding strategies
• Communication strategies

4. Company Background
• Global leader in household and personal care
products.
• Introduced a number of new products worldwide
• Several strategic acquisitions
• High growth in gross margins
• 23.3%V volume share in the U.S. toothbrush
retail market .
• Strong product offerings in value and premium
toothbrush market segments.

5. STRENGTHS
• A unique brush with three different lengths
and orientation.
• Removes 35% more plaque that regular
premium toothbrushes

6. WEAKNESSES
• Positioning itself so that the market of Colgate
Plus Toothbrush is maintained.
• Maintaining the production capacity for
toothbrushes.

7. Product segmentation
• The company divided the product category
into two segments :
• Value
• Professional
• New types – Super Premium brushes, focused
on greater plaque removal and ease of use

8. Consumer Behaviour
• Laid more emphasis on health of their gums
as opposed to cavity prevention.
• Brand choice based on features, comfort and
professional recommendations.

9. COMPETITION

10. • Major competitors in all three product
segments.
• ORAL-B: professional endorsements are high
• Launched the ‘ INDICATOR BRUSH ‘ , priced at
15% premium to its other brushes.
• Various offers and mail-in refunds.

11. Johnson& Johnson
• Reach brand
• Launched Prevent, a brush with a handle to
aid in brushing hard-to –reach places.
• Ranked third in the U.S. retail market with a
major volume share .

12. Procter & Gamble (P&G)
• Entered the toothbrush market with ‘Crest
Complete ’
• The ability to reach the tooth upto 37%
farther than leading flat brushes .
• Coupons and refunds on brushes purchased
from floor stands.

13. Advertising and Promotion
• Advertising enhanced the category visibility ,
thus fuelled consumer demand .
• Toothbrush sales increased when Colgate
toothbrushes were combined with Colgate
toothpaste in a single display.
• Importance of point-of-purchase displays and
bristle qualities.
• The CP toothbrush lined 25% to 40% of the
product shelf-space .

14. Distribution
• Food stores expanded their shelf pace
devoted to oral care products .
• Toothbrushes provided retailers with an
average margin of 25% to 35%, twice that for
toothpaste .
• Most retailers were receptive in adding new
toothbrush products.

15. Research and Development Task Force
• Five goals:
1. Understanding the varying techniques that consumers
use while brushing teeth.
2. Testing the between teeth-access of different
toothbrush designs .
3. Establishing an index to score clinical plaque removal
efficacy at the gum line and between the teeth .
4. Creating a bristle configuration and handle design
with maximum plaque removing efficacy.
5. Determining through clinical and consumer research ,
the efficacy and acceptance of the new toothbrush
design .

16. Positioning
• Two ways that CP could be positioned
• Niche product (to be targeted at consumers
concerned about gum disease )
• Mainstream product (broader appeal of being
the most effective brush in the market )
• It was estimated that positioning as a
mainstream product , the volume shares can
be more.

17. NICHE PRODUCT POSITIONING: PROS
• Target consumers concerned about gum
diseases.
• It could command a 15% price premium over
Oral-B and would be expected to capture 3%
of the U.S. toothbrush market at the end of
the first year.
• No SKUs needed to be dropped .

18. NICHE PRODUCT POSITIONING : CONS
• Better market share if positioned as a
mainstream product, i.e. about 10%.
• High volume share in mainstream as
compared to niche positioning.

19. MAINSTREAM POSITIONING: PROS
• Larger market and volume share at the end of
first year after launch .
• Greater proportion of sales would occur
through merchandises and club stores .

20. MAINSTREAM POSITIONING : CONS
• Concerns about canabalization of Colgate –
Plus
• Pressure on product schedules that had been
developed for Niche Positioning .
• Positioning with 7 SKUs will probably require
dropping one SKU.

21. RECOMMENDATIONS ON
POSITIONING
• Initially , CP can be niche positioned and later
broaden to mainstream positioning.This will
help the product gain sufficient recognition by
avoiding cannabalisation .
• This will lead to additional capacity once it
enters the mainstream market .
• Broadening into mainstream marketing would
also lead to greater sales at merchandises and
club stores .

22. BRANDING
• ‘Colgate Precision ’ or ‘ Precision by Colgate’
• Some said that the product should stand alone
and the ‘precision ’ should be emphasized.
• Stressing ‘precision ’ as opposed to ‘Colgate’
would limit the extent of cannibalization of
Colgate – Plus .
• It was estimated that the cannabalization figures
for Colgate Plus would increase by 20% if the
Colgate brand name was stressed .

23. BRANDING RECOMMENDATIONS
• ‘Precision by Colgate ’ would reduce the
cannabalization of Colgate- Plus .
• Placing the Precision at the center of the
brushes would ensure easy acceptance due to
prevalence of the brand and at also give it a
unique stand.

24. COMMUNICATION AND PROMOTION:
RECOMMENDATIONS
• Since sampling would be critical to Precision’s
success, it would be better to use dentists to
sample consumers since professional
endorsements were more credible .
• Spending 75% of all advertising dollars of CP’s
category spending for precision was able to
reach its potential consumers through
extensive advertising .

25. THANK YOU !