13. Business Level Strategy
● According to Michael Porter’s Business Level Strategies one would
consider Colgate-Palmolive to be a DIFFERENTIATOR.
o Name Brand Strategy
o Large Number of Products
o Innovative
● The Miles and Snow strategy would classify Colgate-Palmolive as both a
defender and prospector which means they consider Colgate-Palmolive to
be an ANALYZER.
o Always advancing current products
o Efficient
14. Corporate Level Strategy
● Related Diversification
o Many in store brand names
o Hill’s Science Diet Pet Food
o Colgate Toothpaste
o Palmolive Dish Soap
o Many products are similar in raw materials.
15. Distinctive Competence
● Diversified geographic operation
● Leading market position
● Large product and brand portfolio
● Continuous Improvement
16. Critical Success Factors
● Offering high quality products at a lower price
● Positive Environmental Values
● Offers a variety and depth of products catering to
every buying group
18. SWOT
Strengths
● Expansive Global Presence
● Large market presence
● Diverse Product lines
● Purchasing Power
● Inventory Turnover
Weaknesses
● High Debt to Equity
● Product Recall
● Dependence on international markets
Opportunities
● Increase in disposable income
● Asian Market Expansion
o Under developed countries and
areas
● Increase in societal standard
● increased pet industry spending
Threats
● Economic barriers
● Unstable political structures
● Competition
● Legal and Regulatory risks
● Low barrier to entry
● Political Instability
19. Strengths/Opportunities
Strengths
How will we use our strengths to
take advantage of our opportunities?
S1: Expansive Global Presence
S2: Large market presence
S3: Diverse Product lines
S4: Purchasing Power
S5: Inventory Turnover
Opportunities
O1: Increase in disposable income
O2: Asian Market Expansion- Under
Developed countries
O3: Increase in societal standard
O4: Increased pet industry spending
Maxi-Maxi Strategy
1. Colgate-Palmolive should use its affluence to expand
into more foreign markets, and grow its global brand
(S1, O2)
2. Expanding the company’s product line to include
more pet care items as well as re branding one of its
current products (S3, O4)
20. S/O Implementation
● Using its already established global company, Colgate-Palmolive needs to focus its efforts on
expanding its reach to the emerging small towns and cities that are currently arising in Asia. The
increased demand from these areas provides an excellent opportunity for growth and expansion efforts.
If the company acts quick, they will be able to gain a majority share in these currently developing areas
and have a foothold when the population increases and expands. Colgate products in this area will be
offered in smaller, refillable sizes, and value packs to make the products more affordable and attainable
for this market.
o Implement Colgate’s Program of “Bright Smiles, Bright Futures” (BSBF). Through the program,
children in need receive free dental screenings and education to help build healthy habits, self-
esteem and a foundation for success. Also include programs based on dental health and proper
handwashing practices
● Colgate-Palmolive already has a wide range of dog food products available, all with a scientific feel to
the names, but none with a large share of the market. Colgate-Palmolive needs to get rid of the current
Science Diet named dog food due to bad PR and lack of a following. A re-branding and a re-naming of
the product will excel the dog food to new heights, and the stigma of bad products will be removed from
the pet food sector of Colgate-Palmolive. Deepening their dog food lines to include more treats and
toys will capture the increased spending in pet products in the United States
21. S/O Evaluation
● Within one year of expanding, the company will measure the sales after the
implementation of its products. Since this will be a new area of expansion, previous sales
numbers will be unavailable for the specific area. In order to measure the effectiveness of
the market expansion, Colgate-Palmolive will have to use data from similar markets in
order to measure their reach in these new areas. If specific goals aren’t met, then a
different positioning strategy may be needed. Colgate has previously expanded into parts
of China using cheaper costs and acquiring local brands in order to keep some familiarity
for its new markets, data from this area may be used.
● The change in name and increased advertising for the “new” dog food product should
cause a jump in sales for the new product, and the toys and treats associated with the
new name should grow as well. In order to determine the change in amount of profit from
these new items, its necessary to compare previous years profits to the ones after
rebranding. A comparison to the other dog food brands in Colgate-Palmolive’s line is
recommended since it will provide a better idea of the market share of the rebranded
product line.
22. Strengths/Threats
Strengths
How will we use our strengths to
minimize our threats?
S1: Expansive Global Presence
S2: Large market presence
S3: Diverse Product lines
S4: Purchasing Power
S5: Inventory Turnover
Threats
T1: Economic barriers
T2: Unstable political structures
T3: Competition
T4: Legal and Regulatory risks
T5: Low barrier to entry
T6: Political Instability
Maxi-Mini Strategy
1. Colgate-Palmolive should continue to grow its
expansive global presence and expand into
more countries to minimize its threat of
politically unstable countries. (S1,T2)
2. Colgate-Palmolive should capitalize on its
diverse product line to continue to beat the
competition in innovative products. (S3, T3)
23. S/T Implementation
● Since Colgate-Palmolive is a market leader and it has the assets to grow and expand, it
should increase its global network into newly developing countries and new economies.
Expanding into a multitude of countries mitigates the risk it experiences through
diversification. Colgate-Palmolive has the capital and the expertise to expand into these
markets and use a combination of existing products and market-specific offerings to
develop a presence there.
● In addition, the development of new and innovative products can occur concurrently with
this market expansion due to exposure to new markets. It would be profitable for
Colgate-Palmolive to invest in new product development, especially in developing
countries.
24. S/T Evaluation
● Hedging risk through multiple investments in a variety of markets will help ensure
progressive and stable growth, despite risky political environments and changing
public policies in certain developing countries.
● New markets provide research and development opportunities, expansive
demographics to learn new market dynamics from, and acquisitions that can bring
new talent and intellectual capital into the organization. All of these factors
contribute to the success of a global expansion strategy for Colgate-Palmolive,
allowing it to minimize risk while developing its innovative product line and
increasing its competitive advantage and market stability.
25. Weaknesses/Opportunities
Weakness
How will we minimize weaknesses
by taking advantage of
opportunities?
W1: High debt-to-equity
W2: Product Recall
W3: Dependence on international markets
Opportunities
O1: Increase in disposable income
O2: Asian Market Expansion- Under
Developed countries
O3: Increase in societal standard
O4: Increased pet industry spending
Mini-Maxi Strategy
1. Increase focus on U.S. markets, especially the
pet industry, to lessen damage if international
markets decline (W3, O1, O4).
2. Use increased revenue from the rise in
disposable income and societal standard in the
U.S. to retain earnings and pay debt (W1, O1,
O3).
26. W/O Implementation
● Continue striving for international growth, but focus on having the U.S.
market represent a larger percent of total sales in order to minimize risk.
This can be achieved by expanding the product line in the U.S., especially
the pet food sector.
● The rise in societal standard for health and beauty will increase demand
for personal care products. This, in addition to customers having more
disposable income to spend on the products, indicates that Colgate-
Palmolive’s sales will most likely grow in the future. The company could
then use the profits to build equity for the use of future expenses and rely
less on debt.
27. W/O Evaluation
● Aim for percentage of net sales to be at least 10% higher for North
America than other markets within Colgate-Palmolive. Total sales should
continue growing for all segments.
● Colgate-Palmolive should have lower debt-to-equity ratios in the future.
Even though they are using the debt to fund growth, they should be closer
to half their current DTE.
28. Weakness/Threats
Weakness
How will we minimize our
weaknesses to combat against our
threats?
W1: High debt to equity
W2: Product Recall
W3: Dependence on International Markets
Threats
T1: Economic Barriers
T2: Unstable political structures
T3: Competition
T4: Legal and Regulatory Risks
T5: Low Barrier to Entry
Mini-Mini Strategy
1. To battle the threat of legal and regulatory risks,
Colgate Palmolive should institute product
quality controls as well as a task force to
properly and efficiently handle product recalls
(W2, T4).
2. To battle the threat of unstable political
structures, Colgate-Palmolive should decrease
their dependence on foreign factories and
produce in their host country (W3, T2, T4)
29. W/T Implementation
● The increase in class action lawsuits and mass torts against companies has created a
threat and weakness within Colgate-Palmolive. In order to effectively minimize the threat
from public dissatisfaction. Colgate Palmolive should
o Keep a tighter control over their supply chain
o Utilize a product quality campaign
o Create a Public Representation task force to efficiently handle recalls without public
harm
● Colgate Palmolive’s dependence on international markets has created a dependence on
a country’s stability and government. To protect against losing assets abroad from
unstable governments Colgate Palmolive should
o Ingrain themselves within the country through public goodwill campaigns
o Withdraw assets from high risk areas
o Diversifying assets over several different countries
o Create more products within the host country
30. W/T Evaluation
● To keep a greater control over their supply chain Colgate Palmolive should acquire producers as well
as move factories from abroad to their host country.
o Quality Control Program
create a quality control task force within each country to have an effective control on
product quality
random checks on suppliers and producers to minimize risk of product deficiency
● Public Representation Task Force
o create a task force to keep a good public connection with Colgate Palmolive through media
representation
o have efficient product recall standards to effectively minimize public harm through speed of recall,
acceptance of responsibility, and public reimbursement
o Create an account to deal with product recall issues
● International Dependence Strategies
o Remove factories and production facilities (assets) from high risk areas such as the middle east,
sub-saharan Africa, Central America and South America.(ex. Honduras, Somalia, Syria, and
Ukraine).
o Ingrain company into countries through public goodwill programs such as environmental
responsibility and promotional advertising and giveaways.
o Create a campaign to move more production back into stable countries such as U.S., U.K. and
Western Europe
EMILY- Strengths and opp.
strength- Purchasing power- “able to divest and acquire other companies quickly”
opp- higher demand from small cities and towns in asia
increased number in working women
LAUREN- weaknesses and threats
weakness- liquidity= financing with debt
Courtney
Courtney
-When these small towns develop they will have more money to spend on items previously unavailable to them. Some of the most needed items in these areas are ones to improve health and cleanliness.
-Colgate needs to cut costs in the chinese market and pass the savings along to its customers.
