Analysis of Case Study of Colgate Precision

Analysis of Case Study of Colgate precision
This case is all about the launch of Colgate Precision, which was achieved because of a dedicated team in Research and Development, which was adamant to create a successful oral health hygiene tool. The reason for the spur of the growth of oral hygiene market was due to the customers becoming more responsive towards their oral hygiene. For this, the company invested heavily in the promotional activities. The Aim of this report is to analyse the two different launch strategies for Colgate Palmolives new toothbrush, Precision, and choose the one that is most suitable to the market needs. At the time of its launch, it had three main competitors, namely, Johnson and Johnson OralB, whose brushes were positioned in the super premium segment. It also had to counter the competition from other new entrants like Procter & Gamble, and Smithkline Beecham, Lever, and Sunstar, who had positioned in the super premium segment. Reasons of success of Colgate Palmolive precision: It was exceptionally sensitive in its strategy to differentiate itself from the name for saving it from cannibalising the other products, hence keeping its name as precision. Consumers first purchased toothbrushes without much knowledge or information concerning the products benefits. As new product development increased, and consumers became better informed about the benefits of toothbrushes, they began to focus their interest not only on cavity prevention, but also on the health of their gums, their oral hygiene, and their cosmetic appearance. Because consumer interest and toothbrush purchases began to increase, advertising and promotion also began to increase, which lead to the development and addition of the super-premium product class. Colgate Palmolive referred to the toothbrush as a Technical Innovation, because researches used infrared motion analysis to track consumers brushing movements/ techniques, and consequent levels of plaque removal. It is credited for its success by the innovations like removal of plaque which has been ignored by other brands, which had not tried to remove the superficial plaque that was ignored by other competitors. In 1991, CP held 43% of the world toothpaste market and 16% of the world toothbrush market. Other oral care products included dental floss and mouth rinses. In 1991, worldwide sales of CP's oral care products increased 12% to $1.3 billion, 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 number one position in the U.S. retail toothbrush market with a 23.3% volume share. Dollar sales of toothbrushes 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 47 new products and line extensions. The high level of competition and innovation in the tooth brush industry obliges CP launch a supreme product (super premium
market) SWOT Analysis: Company's Strengths: * Colgate is a well-known brand name in the Oral Care industry. * CP is creating a new and innovative product, Precision. * CP has up-graded 25 of 91 manufacturing plants. * CP acquired Mennen, a men's toiletry company. Company's Weaknesses: * CP has been the laggards in advertising and marketing in the late 1980's. * Colgate has never placed any toothbrushes in the "Super-premium" toothbrush category. Companys Competitors: As earlier being mentioned, the companys main competitors were Johnson & Johnson, and Oral-B. The product was differentiated in 3 segments: A) Uninvolved oral health consumers with a 33%, B) Second category: It was involved in oral health consumers interested in cosmetic benefits with a 21% C) Involved oral health consumers interested in functionally effective products. Marketing Mix: Marketing Mix was in: A) Product: The precision toothbrush that CP developed is a unique brush with 3 different bristle lengths and angles. This design allows for 35% more plaque removal and also proves to be more effective in reducing gum B) Price: The price of the Precision when marketed as a "super-premium" toothbrush would be $ 2.02 and $2.89 for manufacturer retail price and suggested retail price, respectively. The price of the Precision when marketed as a premium toothbrush would be $ 1.76 and $2.13. C) Place: The Precision toothbrush will be placed on the retail shelves between the Colgate Plus and Oral-B product lines. Retail advertising will consist of in-store displays to increased toothbrush sales. As a "super-premium" toothbrush, Precision would be carried primarily by food and drug stores. As a premium toothbrush, a larger proportion of sales would occur through mass merchandisers and club stores. D) Promotion: A forceful advertising campaign that demonstrates the advantage of the new toothbrush will be implemented if Precision is placed in the market as a niche product. Precision positioned as a mainstream product will be promoted through monetary incentives such as coupon or rebates. The Precision will also be promoted to dentist offices. Free toothpaste will be included with the purchase of a Precision brush.
Summary: The C&P (Colgate and Palmolive) A) The C&P was the company was the company that took initiative in R&D. B) It surveyed the Market and then launched the product. C) It also launched the product in differentiation of the product on which other companies missed. D) It encouraged the chemists to get a margin and that was also the turning point of the company.

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