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Colgate Palmolive Company : The Precision Toothbrush
This document discusses Colgate's plans to launch a new precision toothbrush. It provides background on Colgate and the oral care market. Research found consumers wanted improved plaque and gum removal. Colgate developed a toothbrush with differently oriented bristles to clean all tooth surfaces. It could be positioned as a niche high-end product or mainstream product. As a niche product it would target gum health and gain 3-5% market share. As mainstream it could gain 10-15% market share. Costs include new manufacturing equipment. Test marketing showed the "Colgate Precision" name was favored and could increase Colgate Plus sales by 20% depending on branding emphasis.
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Colgate Palmolive Company : The Precision Toothbrush
- 2. CONTENT • Company Background •Problem Statement • Why there is Demand ? • Colgate Precision Design • Features • Positining • Investment Cost • Price • Branding • Promotion • Pros and cons of Positioning
- 4. COMPANY BACKGROUND in1991 Global leader in household and personal care products. •Total Sales - $6.06 billion •Gross Profit - $2.76 billion •Research and development expenditures - $114 million •Media advertising expenditures - $428 million Faced tough competition in international market from Procter & Gamble, Unilever, Henkel of Germany, Kao of Japan.
- 6. PROBLEM STATEMENT Defining themarketing strategy Positioning, Branding & Communication Strategies for new toothbrush. COLGATE PRECISION
- 8. US TOOTHBRUSH MARKET •US Oral Care Market is $2.9 billion in retail sales. • Annual growth rate is 6.1 %. • Toothbrushes had grown at average rate of 9.3% per annum which is increased by 21% in value and 18% in volume. • Dollar growth exceeded volume growth due to emergence of “super premium” sub-category of toothbrushes. IN 1991
- 10. PRODUCT SEGMENTS • Industryexecutives divided the toothbrush category into – value, professional & super premium brushes. • Toothbrushes differed by bristle type and by head size. Firm bristle brushes - 8% Medium bristle brushes - 39% Soft bristle brushes - 48% (Sold per year)
- 11. New products introductionsare focused on technical performance improvements, i.e. Plaque removal and ease of use • Many new toothbrushes are introduced on the basis of aesthetic rather than functional features. • The children’s segment has seen a variety of new products targeting children featured sparkling handles, Bugs Bunny and other characters.
- 12. CONSUMER BEHAVIOUR • Consumersof baby boom generation were becoming more concerned about the health of their gums as opposed to cavity prevention. • Most consumers agreed that the primary role of a toothbrush is to remove food particles; plaque removal and gum stimulation are considered secondary. • Choices are based on features, comfort, and professional.
- 16. PRODUCT design • ThePrecision toothbrush is a technical innovation. • Researchers used infrared motion analysis to track consumers’ brushing movements and consequent levels of plaque removal. • CP developed a unique brush with bristles of three different length and orientation.
- 17. It has triple-actionbrushing effect 1. The longer outer bristles cleans around the gum line. 2. The long inner bristles cleans between teeth. 3. The shorter bristles cleans the teeth surface.
- 19. • Brushing usuallydid a good job of removing plaque from teeth surfaces but was often ineffective at removing plaque from the gum line and between the teeth. • The tests revealed that CP’s new design was superior to both Oral-B and Reach in accessing front and back teeth, using either horizontal or vertical brushing. • Creating a bristle configuration and handle design offering maximum plaque- removing efficacy.
- 20.
- 21. NICHE Product • Itcould be positioned as a niche product to be targeted at consumers concerned about gum disease. • it could command a 15% price premium over Oral-B and would be expected to capture 3% of the U.S. toothbrush market by the end of the first year following its launch. • With a niche positioning, Precision retail sales would represent 3% volume share of the toothbrush market in year 1 and 5% in year 2.
- 22. MAINSTREAM Product • Precisioncould be positioned as a mainstream brush, with the broader appeal of being the most effective brush available on the market. • As a mainstream product, Precision could capture 10% of the market by the end of the first year. • With a mainstream positioning, these volume shares would be 10% in year 1 and 14.7% in year 2.
- 23. Investment Cost • Threetypes of equipment were required to manufacture the Precision brush: tufters; handle molds; and packaging machinery.
- 24. AS NICHE PRODUCTAS MAINSTREAM PRODUCT
- 25. BRANDING • The ColgatePrecision name was consistently viewed more favorably—it was deemed appropriate by 49% of concept acceptors and appealing by 31%. • It was estimated, both under the mainstream and niche positioning scenarios, cannibalization figures for Colgate Plus would increase by 20% if the Colgate brand name was stressed but remain unchanged if the Precision brand name was stressed.
- 29. • Consumers wereexposed to various product claims in prototype print advertisements and then asked about the likelihood that they would purchase the product
- 32. DISCLAIMER Created by YashJain, NIT Jalandhar, Jalandhar, during a marketing internship Under Professor Sameer Mathur, IIM Lucknow