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Marketing of Colgate toothpaste in the USA

Executive Summary
Introduction
Colgate-Palmolive is one of the world's largest Consumer products companies founded
USA in 1806 by market share with commercial presence on six continents
...
The company has grown into
a multinational corporation known for its toothpaste and oral hygiene products with a
$15
...
3 billion in net income for fiscal year 2009 and ending
that year with a staggering 44
...

Colgate-Palmolive is a global company that offers consumer goods
...
The company strives for global market share, continuous growth and
competitiveness on its oral hygiene product
...
Colgate has been ranked as
India’s #1 Most Trusted Brand across all categories for four consecutive years from 2003
to 2007
...
30% share in the toothbrush market as
compared to their competitor HUL pepsodent
...

Highlighting increases in their toothpaste and manual toothbrushes market share
...
Exchange controls
affecting revenue collection to the parent company
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Economical

Recent economic conditions would have affected the company in term of financiers
struggling to stay afloat
...
In such economic conditions interest
rates on loans would be reduced and so benefit the company in terms of borrowing loans
at cheaper interest rates for further investing in research and development and
technology
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Social/ cultural
Colgate- Palmolive differentiates it toothpaste market to consumer’s lifestyles, custom
and norms
...

Technological developments
Colgate-Palmolive has globally marketed their toothpaste brand and aligned
communication and transportation technology in distribution , production and
manufacture to compete effectively in the toothpaste market
...
Colgate is also actively participating in community services and has engaged
in operations in facilities to meet or exceed the desired environmental standards
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Situation analysis
SWOT

Strengths



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

The company's flagship product, Colgate Dental Cream is the largest selling
toothpaste
...

It has captive manufacturing facilities for flavor and other ingredients, which
yield significant cost savings
Research and development fostering emergence of new product development
thereby broadening market share
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Strong market position and brand image – trusted brand that pioneered
traditionally
Strong financial position attracting potential stake holders





Their products are available geographically though distribution in region and
countries
Strong mentoring leadership to empower employees to embrace culture
Distribution advantage in marketing its Colgate toothpaste brand alliances were
form with dentist professionals and hygienist guaranteeing the company of a
market within that segment
...
Increases in interest rate and foreign exchange rates can cause
lower revenue or high financial debt affecting thoer distribution
...

Emerging updated suitable technological advances to boost efficiency and to stay
ahead in the market
Health conscious life style – causing demand of oral hygiene product
Increase in population – Colgate seen as a common commodity and opening of
new market and growth
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Threat




Intense competition and rivalry for the leading toothpaste market in oral hygiene
products by competitor such as crest and aquafresh usually causing lower product
price and high investment in marketing in order to gain market share
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Consumers in being indecisive of toothpaste brand choice due to competitors
introducing new products with similar marketing strategies
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Competitors undertaking pricing strategies
for example buy tubes of toothpaste for two dollars less would attract more customers to
use their new product as well as retain sales revenue turnover
...
Competitor introducing similar product
using similar marketing strategies and offering products cheaper can give buyers, retailer
and distributors the advantage of having significant power in the market
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2) Buyers bargaining power
Colgate toothpaste innovation and variety of toothpaste line has allowed the company to
maintain it premium price
...
In
this aspect bargaining power of consumer is low
...
These suppliers are now in a position to control price
due to the fact that new supplier has to be qualified under the industry and government
regulations these would carry a cost in both time of delivery of finished product
...


4) Threat of new entrants
New entrant may find it difficult to enter in this toothpaste industry as the market is
flooded with established consumer loyalty products some premium priced with their own
niche and some low priced competing for market share
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This type of industry is highly capital intensive technology requiring large capital
investment and high investment in research and development, production and
distribution
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5) Threat of substitutes
Toothpaste is a commonly used product and as a result most consumers would not see the
differences or find many uses in toothpaste
...
Other
market substitutes such as mouth wash toothpowder dental floss and baking soda is low
in America
...
They gained Americans confidence of the market with the introduction of
Colgate total that was viewed as the ultimate tooth protector
...

They had major acquisitions that boosted market share as well as set up manufacturing
facilities for flavor and other ingredients that gains significant cost saving
...
They continued this by accelerated innovation through
collaborative partnerships with leading suppliers for example The Forsyth institute,
independent leading organization in scientific research and education in oral health care
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Colgate uses a computer business planning software that generate efficiency in trade
promotion spending measuring its actual performance against goals and plans of each
brand resulting in cost savings
...
Although they have been maintain some level in adhering to environmental
policies
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Colgate toothpaste used different varieties to segment its products of those that preferred
the traditional toothpaste and also those that evolve with demographic life changes in
term of healthy hygiene of therapeutic toothpaste for those seeking whiter teeth,
diabetics, kids and vegetarians
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Targeting
Dentists professional, hygienist, academia and key opinion leaders and consumers of
which are both kids and adults that both experienced problems of gum diseases, hygienic
problems and bad breath
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Positioning
By establishing relationships with dental professional, hygienist, schools, communities
and sponsoring sporting events (women)
...

These studies also create opportunities for academic endorsement, publication in
scientific c journals and presentations at global dental conferences, all of which help to
further build their credibility with the above organization, institutions and consumers
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Marketing strategies and programmes

Product

Kids – based on taste and protection using popular cartoon characters such as barney,
Dora and Sponge Bob
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They used innovation and scientific research to reinvent varieties through updated
technologies
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Product usually manufactured in 6 oz and 7
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These product were patented and had the approval of the food and drug division

Price
Their tooth paste varieties continue to capture premium prices due to continuous
reinvention and innovation
...
Some of the factors that affected prices include
Packaging – highlighting its premium brand
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Toothpaste ingredients are patented and so will maintain premium prices as competitors
will find it difficult to match differential advantage
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Using improved communication from globalization has benefited the company in that its
boost awareness through internet’s popular social networking websites such as face book,
twitter and cable TV displaying messages of are you protected and don’t forget to protect
in that it is cost saving of having to reach consumers in all geographic region rather than
having to use different advertising campaign in each region as well as gain feed back
...


Using Colgate business planning software to ensure efficient use of promotional
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They used the
same type of advertising around the world capitalizing on enhanced globalization
communication technology such as cable TV and internet that was cost saving and reduce
time, cost and effort in producing ads in different regions
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To gain information of current trends advances in dental research and their reaction to
new technology and products
Colgate can change its generic promotion of toothpaste based on active ingredients to a
more dynamic approach
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Using a generic marketing approach for cable TV and internet may not appeal to the
culture of all the regions especially advertising varieties that are not available would
cause consumers to lose confidence and not have the right perception in their products
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Using cable TV, Colgate should consider the appropriate time to run ads to gain attention
of the particular segment for example in targeting kids ads should be run during cartoons
featuring favorite cartoon characters
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They can also use this same strategy to target adults of popular health and fitness TV ads
radio show or even promote health tips during peak listening time on radio
Place
Communities, schools and dental offices

Marketing Objectives and goals
Colgate would like to maintain its conservative financial approach
To be confident that Colgate is well positioned for long-term, sustainable growth due to
our financial strength
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One new initiative rolling out globally fosters the joint development of commercial plans
that align both the customer’s and Colgate’s strategic priorities and business goals As we

continue to build on our global strength, a cornerstone of our success remains our sharp
focus on four clearly defined strategic initiatives:
(1) getting closer to consumers, the profession and our customers;
(2) driving innovation throughout all areas of our business
; (3) increasing effectiveness and efficiency everywhere; and
(4) strengthening leadership worldwide
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Conclusion

Using the above the should address weakness and threats in transforming it’s as
opportunities to reposition variety and services to their set marketing plan Hollensen
(2003)

Identification of Issues/Problem
Colgate-Palmolive, a leading global consumer products company, needed to respond
more rapidly and cost-effectively to new opportunities in its complex global marketplace
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Colgate-Palmolive manufactures and markets a wide variety of products in the United
States and around the world
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The company had inventory levels that were unnecessarily high, order-related
cycle times that were excessively long, and IT and other costs that were much higher than
they would be with global standardization of systems and data
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It
needed to streamline the supply chain, get rid of bloated inventories, and speed up the
order-to-delivery process
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Recommendations
To counteract the issues at Colgate’s toothpaste industry they should use promotional
campaigns and mobile dental checkup to enhance image
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And we will also try to
figure out our mistakes
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Our plan includes that, are our ads suitable
to target market or not?
Updating Plan
The company will keep a regular check on the market and record any change in the
market trends changing behavior of its customers
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Communicate vertically, horizontally, internally, and externally
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" To maintain relationship with their customer

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