Colgate Palmolive Staying Ahead in Oral Care

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TOPIC – Colgate Palmolive staying ahead in Oral Care.

Submitted to:                                                                                Submitted by:

Prof. Manoj Das               Giriraj Navander

                                                                                                                                  (15A3HP631)

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SUMMARY

Established in 1806 and founded by William Colgate. Colgate was leading consumer Product Company with the revenue of $15.50 Billion in 2010. With spread of various different consumer product across 200 countries. In 2011, Colgate-Palmolive (Colgate) was the world leader in oral care, with a dominant market share lead in toothpaste and a growing presence in toothbrushes, mouthwashes and other oral care products. However, the company faced stiff competition from perennial rivals like P & G, Uniliver and other competitors to increase their attention to oral health care products in the emerging markets, where Colgate was traditionally been untouchable with its leveraging Brand equity. It always use to stands for trust and family and, increasingly and innovation. It always uses to believe in M&A of small Oral care manufactures for better development in the market leader and low cost manufacturing. They have the Organizational Structure for both the Long term and short term innovations. To protect his lead in the market Colgate attempted to cover all fronts, using the brand, maintained a strong relations with the retailers and spend huge on the advertising, strengthen the close relations with dentists, participating in oral health month and presenting dental conventions, claiming them as the “Number 1 recommended by Dentist”, innovation in underserved markets, using its global network to move quickly to market and continuously reinvesting in its name and innovations to grow more and maintain its market share in the emerging markets.

Q1) what is Colgate doing to create & defend its position? What are the measures being taken by them?

Ans) Colgate was known for its ability to sustain its strong position in oral care. The firm focused on many defendable for its position which is.

1. Building a strong Brand equity: Many of the Analysts noticed that the Colgate brand was one of the most Valuable brand in the world and top brand in the oral care. Consistently it’s maintained its brand equity. They basically represent their brands as trust and family and increasingly innovations. One example is where Colgate researchers studied the villager’s habit and recognized mothers hoped that the children would be healthy and stay strong education. Through these insights they came up with Colgate Scholarship campaign. This helped the Colgate to build brand among the consumers.
   

1. In Store advertising & Promotion : Colgate spent approximately 10% of the sales revenue on advertising, because more than half of the Consumers purchasing decision is taken in the store which made the Colgate as brand present and trust in the mind of the consumer. They also launched the strong social and digital media effort connecting with consumer by offering informative through online videos featuring consumer testimonials.  
   
2. Building Relations with Dentist: They saw professional Brand endorsement as crucial for building brand equity among the mind of consumer. So they strengthen the close relations with dentists. They used 10- point plan that would ensure scientific support and recommendations for Colgate oral products.  The plan focused on sales, marketing and promotional activities ,participating in oral health month and presenting dental conventions to explain the science and research behind the Colgate products as well as offering some samples and obtaining dental seals of approval of the product, they also claim them as the “Number 1 recommended by Dentist”

The measures being taken by the Colgate are:

1. Focused portfolio optimization: Compared to P & G and Uniliver Colgate was the smaller company and more focused on a single line product. It M &A was played as a major role in Oral care business. Colgate has acquired four major oral care companies which were valued at $100 million. While acquiring the smaller companies in the market this measured helped to capture the market share.
   
2. Continuous Innovation and Speed to market: Colgate continued spend lot of money in innovation of the product. It innovated by attempting to develop products that address the specific needs of the consumer, and helped the company grow. They have the Organizational Structure for both the Long term and short term innovations.

Q2) what are the tradeoffs of these decisions?

Ans) Compared to P & G and Uniliver Colgate was the smaller company and more focused on a single line product. Oral care made up 42% of Colgate sales mix, compared to approx. 6% for P&G. Colgate was conservative and extremely targeted with large acquisitions and divestures. Its strategy was based on driving growth in Oral care while limiting exposure to low margin businesses such as laundry detergent.