HBR colgate case study

1. COLGATE
THE PRECISION
COMPANY

3. In 1806,williamcolgateintroduced starch,soapand candlefactory on thedutch
streetin the new york cityunderthe nameof williamcolgateand company
In 1857,williamcolgatedied andcompany was recogNizedas a colgateand
company under the managementof samuelcolgate,his son
In 1873,thefIrm introduced,firsttoothpastean aromatic toothpastein jar

5. Industry: personal products
Founded: 1806
Headquarters:new york city,new york,US
Key people:Ian M,Cook,CEO
Revenue:US$15.3 billion(FY2009)
Employees:36002
Website:www.colgate.com

8. Company:in1991,CP held43%of theworldtoothpastemarketand16% of
worldstoothbrushmarket.
Otheroralcareproductsincludeddentalflossandmouthrinses.

9. In 1991,worldwide sales of CP’s oral care products
increased 12% to $1.3billion,accounting for 22% of
CP’s total sales.
Toothbrushes represented 19% of CP’s U.S Oral care
division sales and profits,and CP held the no. one
position in the U.S retail toothbrush market with a
23.3% volume share.

10. Dollar sales of the toothbrush had grown an average rate of 9.3%per annum since
1987,but in 1992 they increased by 21% in value and 18% in volume due to the
introduction of of 47 new products and line extensions.
The high level of competition and innovation in the toothbrushlaunch industry
obliges CP launch a supreme pr
Dollarsales of the toothbrushhadgrown anaverage rate
of 9.3%perannumsince 1987,butin1992 they increased
by 21% invalueand18% in volumedue tothe
introductionof of47 newproductsandline extensions.
Thehigh level ofcompetitionandinnovationinthe
toothbrushindustryobligesCP launcha supreme
product(superpremium product)

12. COMPANY’SSTRENGTH
•Colgate is a well known brand name in
the oral careindustry.
•CP is creatinganew and innovation
product,PRECISION.
•CP has up-graded 25 of91 manufacturing
plants.
•CP has acquired Mennen,a men’s toiletry
company.

13. Company’s weakness
•CPhas beenthe laggardsinadvertisingand
marketinginthe late1980s.
•Colgatehas neverplaced anytoothbrushesin
the “super-premium”toothbrushcompany.

14. FREQUENTLY ASKED

15. Q1) What changes are occuring in the toothbrush
category? Assess colgate-palmolive competitive position(Market shares:Exhibit
6,Channels of Distribution:Exhibit 7,Media Expenditures:Exhbit 8)
Q2) Who has the biggest market share? OralB
Q3)Which channel sells the most(Dollar and Volume)
for colgate? Colgate: Plus
Q4)Which brand spent the most dollar($) in
advertising by the end of 1992? Reach
Q5)What are three segments for the toothbrush
market?1)Therapeutic 2)Cosmetic 3)Health
OBJECTIVE

16. Q1)What is the overall marketing objective?
Ans)It provide consumers with an abundance of oral hygiene products that
meets their desired benefits in each market segmentation in order to obtain
brand perception in the market.
The marketing objectives may be different from the communications
objectives.
Remember that the communications objectives are derived from the
marketing objectives.
Q2)What is the role of marketing communications in the overall marketing
objectives?
Focus on information in the marketing plan that is relevant to the
promotional strategy.
Focus on the competitive analysis and assess environmental influences.
Find the most important factors that really describe the marketing
problem,and then explain how factors relate to the communications task at
hand.
SUBJECTIVE

21. COMPETITION AND COMPETITORS

25. COLGATE’S

26. ADVERTISING
CHANNELS
TV
COMMERCIAL
Launch reminder ads wit ADA
Accreditation(Fall ‘92)
Indirect competitive ads(Nov/Dec.
’92)
Direct competitive ads (Dec ‘92-Jan
‘93)
SLOGAN YOUR DENTIST IN YOUR HOME

32. Colgate pricing is based on production costs
includingthewarehousingand transport costs.
One mainconcernabout the Colgate
Precisionwas if it hadbeentreatedas
mainstreamtoothbrushthenit wouldleadto
cannibalizationof colgateplus.

33. In Urban Population,Colgate concentrated more on
the technical performance and other marketing ideas.
It also concentrated on children by adding sparkles
to the handle,glow in the dark handles or bugs bunny
shaped handles to make it more attravtive.

34. Advertising through TV Media and Newspaper
Media.
FM Radios and other Radios.
Hoardings on highways and National Highways.
Use Dentists to sample customers and make
them buy Colgate Products.

35. Colgate would try to increase product
penetration into the rural population.
Colgate would try to increase the number of
wholesalers in the rural areas.

38. CONCLUSION

39. The brand “COLGATE” has been sold successfully
and has created a good demand all the time.
It is also holding a good place in the toothpaste
market with a share of around 10%-15%.
As like for all other products Colgate is also facing
a tight competition in the toothpaste market.
Since the competition is too strong the company
has to keep on watching market closely for avoiding
any sudden collapse for the product.
Finally it should be noted that the company has to
face lat of threats in coming years like political
threats, legislation threats,ongoing economic
crisis,changing life style of the people etc. If Colgate
is able to overcome all the threats and can prepare
themselves for facing he problems in advance it can

41. Created by K Apurv,HSSMC Raipur,during a marketing
internship by Prof. Sameer Mathur,IIM Lucknow