Harvard Business case study on Launch of new product by Colgate Palmolive known as Precision.

3. SITUATION!
• In August 1992,Colgate-
Palmolive(CP)was poised to launch
a new toothbrush in the United
States, tentatively named COLGATE
PRECISION.
• Susan Steinberg, Precision Product
Manager has to recommend
Positioning, Branding and
communication Strategies for
“The Precision”.

4. PRODUCT
SEGMENTATION
• Value
• Professional
The late 1980’s saw
the emergence of
another category
called super
premium brushes

7. PRODUCT DESIGN
The longer
outer bristles
The long
inner bristles
The shorter
bristlesIncrease in
Plaque
Removal
Plaque
Removing
Device

9. 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…

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

11. Tooth Brush as Niche Tooth Brush as Main Line
Product
Year 1 Year 2 Year 1 Year 2
Initial Investment
costs
$ 3.2 M $1.300 M $ 9.1 M $ 3.9 M
Depreciation costs $ 0.316 M $ 0.45 M $ 0.88 M $ 1.2 M
Advertisements and
promotion costs
$ 11.2 M $ 11.7 M $ 32.8 M $ 29 M
Manufacture cost
per unit
$ 0.66 M $ 0.64 M
Costing For PRECISION product

12. Anticipated Production and
Pricing
Tooth Brush as Niche Tooth Brush as Main Line
Product
Year 1 Year 2 Year 1 Year 2
Number of Units 13 MM 20 MM 42 MM 59 MM
Manufacturer listed
Price Per Unit
$2.02 $ 2.49
Suggested Retail
Price
$2.89 $ 2.49

15. Launching Strategy:
• Target therapeutic and cosmetic brushers
• Enter the Super-premium niche market
• Move to Mainstream market
• Distribute to Dentists and Drug stores
Advertising campaign:
• 1993 Budget: Increase overall toothbrush
Ads & Promotion Budget by $19.2M
• Devote $32.5M to Precision, $10.8M to Plus
• Ads focused on Prevention of gum diseases,
toothbrush effectiveness(need to develop
superiority claim)

16. WHERE TO POSITION
PRECISION…!!

17. • Initially Positioning
Precision : As Niche
Toothbrush to avoid
cannibalization.
• Later Broadening into :
The mainstream
positioning would enhance
greater proportion of sales
through mass
merchandisers of food and
drug stores.
POSITIONING:

18. • “Precision By Colgate "as
it would reduce
cannibalization of Colgate
Plus- the bread and butter
of CP’s toothbrush line.
• Placing The Precision at
the Center of the Brushes
in the storage shelves for
easy access and
acceptance.
BRANDING:

19. • More Investment on
Advertising and
Promotion for a head start
to this potential product.
• More promotions to
attract potential buyer for
mainstream positioning.
• Dentists to sample
consumers since
professional
endorsements are more
credible.
COMMUNICATION STRATEGY:

20. Created by
Ashay Pathak,
Birla Vishwakarma Mahavidyalaya
during an Internship under
Prof. Sameer Mathur, IIM Lucknow