Colgate Palmolive Case Study

Resume Case Study : Colgate Palmolive

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1. Background

• Headquarter in New York City USA
• Founded in 1806 with starting business as starch, soap and candle.
• Has famous business as  oral brand especially tooth paste.
• Develop the other business such as : personal care, home care and pet nutrition.
• Personal care has been developed after acquisition other company soft soap in 1987 and deodorant & antiperspirants in 1992.
• Has created revenue USD 15.5 Billion in 2010 and coverage market in over 200 countries.
• Oral, personal and home care are main products which have made majority of sales 87 %.
• Rank of main products is oral care 43 %, home care 22 % and personal care 22 %.
• 75 % of 15.5 billion or 11.63 billion as revenue came from outside USA.
• 25 % of 15.5 billion or 3.88 billion as revenue came from USA.
• 40 % of 15.5 billion as revenue came from developing markets.
• Oral care is the strongest of product category’s colgate, bath & shower as second and hair & deodorant as third.

1. Competing in Oral Care

• Colgate has market share growing up from 22.4 % to 24.4 %.
• Colgate global market share for tooth paste is 45 % and 32 % of manual toothbrush.
• In USA Colgate was second in market share of toothpaste and toothbrush after P&G.
• In USA Colgate was second in market share of Oral Care after P&G, but the first in Latin America with percentage 49 %, Europe with 20 % and Asia & Africa with 21 %.
• P&G is leader of oral care company in North America with its product Crest and Oral-B which has percentage 35 %.
• By 2011, P&G and Unilever overlapped Colgate in market share with reducing pricing and increasing spending.
• P&G has overlapped Colgate in toothbrush with Oral-B, and toothpaste as the priority to against Colgate.

1. Defending Market Leadership

• The key success for Colgate defends from competitor to be retain as a leader in Oral Care are :

• Dental endorsement.
• Repeatable approaches such as education in emerging markets.
• Leverage its brand and widespread name recognition by selling of its oral care product under Colgate name such as : whitening, natural product, floss and mouthwash.
• Routine activities such as : marketing, advertising, strong product placement and consistency.
• Routine activity especially in advertising, Colgate has invested heavily in-store advertising and promotion with approximately 10 % of sales revenue or 1.55 Billion.
• Launch a strong digital media connecting with consumers in their homes and at their workplace by offering informative websites and online video featuring consumer testimonials.

• Consistency in brand equity means creating trust, influencing family and increasing innovation.

• Colgate learns consumer’s habit and live to maintain its standing with consumers
• Colgate creates campaign program to support habits and live of consumers.

• Colgate has been the most recommended product by dentist with 43 % recommendation against 15 % from the closest competitor.
• Colgate perceived that professional endorsements as crucial for building the equity brand, increasing brand awareness and facilitating new product trials.
• Colgate made relationship building with dental professional as priority and used 10 point plan to ensure scientific support and recommend for Colgate oral product.
• The plan focused on sales, marketing and promotional activities, participating in oral health month, and attending and presenting at dental conventions to explain the science and research behind Colgate product as well as offering samples and obtaining dental seals of approval for product.
• Colgate developed a training program for its sales force members who visited dental office. This program aimed to turn the sales force into oral care consultants.

1. History and Strength in Emerging Markets

• Colgate has the strong share and high growth markets in toothpaste (70 % market in Brazil, 51 % in India, 35 % in Russia, and 32 % in China.
• Colgate built relationship also with emerging market dental professional (77 % in Brazil, 81 % in India, and 85 % in China.
• Market growth in Emerging market is higher than develop markets which indicates with CAGR 8 % against 2.1 %.
• Colgate had a long history in emerging markets such as : 75 years in Latin America and 50 years in Asia.
• Its experience support Colgate to understand of local preference and taste, deep consumer and market knowledge, so Colgate can refine its global marketing.
• By its history and experience with Emerging Market, Colgate perhaps it can be implemented also to developed markets.
• Colgate used education method to consumer about oral hygiene to drive consumption, and use this approach to a new market quickly.

1. Focused Portfolio Optimalization

• Colgate is very focused on a single line products with Oral Care as priority. Oral Care  made up 43 % of Colgate sales mix.
• Using conservative method to enlarge portfolio, which are acquisition and divesture.
• For acquisition, Colgate has acquired 4 acquisition with value over USD 100 Million from 1991 to 2011, three of which were oral companies. The companies are Kolynos in 1995, a popular Latin American oral care brand for 1.04 billion, GABA in 2004, a European oral care business strong channel in pharmacies and close to dental professionals for USD 850 and Tom’s of Maine in 2006, the leading manufacturer of natural toothpaste for USD Million
• This method to penetrate market and make greater portfolio.

1. Continued Innovation and Speed to Market

• Colgate conducted innovation by attempting to develop products that address specific needs of customer and helping the company grow into previously underutilized areas, avoiding cannibalization while growing exposure.
• Colgate rolled out the new product swiftly.
• Colgate developed an organization that support both long term and short term innovations.
• Colgate had mid term innovation centers based around the world to learn about trend and develop innovation that could go market within one to three years.

1. Go to Market and Targeted Outreach

• Colgate built relationship with retailers, which both of them set objectives in shopper marketing, customer service, finance and aligned strategic priorities to attract consumers.
• Colgate worked to continue finding ways to attract consumers to premium products which often involved working with retailers on ads and reminder placement in stores.

1. Reinvestment of Cost Savings

Colgate focused on reducing cost started in the late 1990 such as : offering direct investment back to brand manager, making other efficiencies, saving of firm money and locating new and less expensive factories without reducing the shelf space for Colgate products.

Conclusion

Colgate ways to make still leading in Oral Care Market :

1. Focusing on and investing in only one product : oral care.
2. Expanding brand.
3. Developing relationship with dental professional and retailers.
4. Making innovation
5. Growing its market share in its high market : Emerging Market.

Resume Case Study : E Bay’s Connected Technologies : Innovating Customer Engagement In The Retail Industry

1. Background

• eBay began in 1995 as an online auction marketplace.
• That company grew rapidly for sales and net income in a year.
• After years doing in online auction, ebay expanded business which offered sellers an online platform to sell goods directly to consumers.
• Purchasing online secure payment technology PayPal to facilitate online transaction, though eBay spined off PayPal in 2014.
• eBay had built its business not by selling its own product, but facilitating transactions between independent buyers and sellers.
• Providing electronic commerce service to a large number companies and e-Commerce storefront platform with purchasing GSI Commerce and Magento.
• eBay run 3 units for its business under eBay Inc : eBay Enterprise, eBay MarketPlace and PayPal.
• Providing fulfill transactions which added delivery service as innovation to retailers, so their budget cost will reduce efficiently.
• Operating 7 seven fulfillment centers (5 in USA, 1 in Canada and 1 in UK).
• eBay enterprise has various services depending on their needs, which can design, store and handle of logistics (picking, packaging and shipment).
• Company revenue in 2013 : USD 16.1 Billion : 51.6 % from eBay Marketplace, 41.3 % from Payments and 6.9 % from enterprise group.

1. Changing World of Retail

• Changing retail transactions from face to face to online method.
• This changing enables consumers to search and buy by online or buy in-store.
• Smartphone era made difficult position for in-store to sustain, especially for price cheaper than in-store.
• Smartphone era made consumers easy to buy  just stand in store.
• eBay had been an important part of revolution in retailing, facilitating transactions between buyer and seller.

1. Retail Innovation at eBay

• eBay began a series of innovations that utilized mobile and other technologies, such as : providing delivery in 1-2 hours of purchases from local stores in selected cities in 2012, just for USD 5.
• eBay provided a mobile apps that enables consumers to search inventory of stores in their neighborhood.

1. Merging Online and Offline Retailing

eBay provided and facilitated commerce by online and offline.