Based on the data in the case study, ColgateColgate-Palmolivehas introduced new products worldwide and setup manufacturing facilities in China and Eastern Europe, breaching the new emerging economies inof the 21st century. With an energetic and visionary leader like Reuben Mark at the helm of ColgateColgate-Palmolive, the company has transformed itself into a lean and profitable machine, from its inefficient past, leading to increased ing profit margins and volume growth. Clearly, having a visionary CEO is a strength. This strategy has been successful, asis good because toothbrush sales through food stores, drug Sstores and mass merchandising channels have produced the greatest volume and dollar are some of the top channels in terms of dollar and unitsales historically.
Susan Steinberg, the product manager, has to determinate the best marketing mix to implement and which of the follow options are the best in order to position the product in the market: A Under a mainstream B Under a niche strategy.
Each strategy has The precision toothbrush different prices and volumes of unit sold. More and more customers look for toothbrushes that satisfy their needs. For example Baby boomer's generation, one of our main targets, look for products that help them to have healthy gums.
Consumers differed in the industry of their involvement in oral hygiene: Competition in the Toothbrush market for Colgate Palmolive was tough. Oral B's brushes were positioned in the super premium segment.
Where it had no strong competition for the moment since Johnson and Johnson, with its Reach brand focused only on the professional segment. CP - global leader in household and personal care.
The company was profitable and shows annual volume growth. Their plan for emphasized new product launches and entry into new geographic markets, improved efficiencies in manufacturing and distribution and focus on core consumer products toothbrush is one of them.
Because of their knowledge they can explain the main advantages of a technological breakthrough product such as the one we're proposing to launch. Also Colgate dominated the food stores Therefore, the advertising campaigns and promotion activities increased considerably.
Subsequent the consumers are more interested on oral health care and therefore buy more sophisticated health products like toothbrushes. The Colgate Precision Toothbrush will be news in the mainstream market, and could use the prestige of the Colgate Company in order to position itself in the market.
With 7 sku's for adult and child, it will require a loss of two of the sku's with low rotation. The probability of Colgate Precision cannibalizing Colgate Plus market share is quite high.
Advertising cost will increase almost three time compared with niche.
The annual packing capacity is 40 MM units and Colgate plan production is 42 MM units for the first year, therefore capacity is not enough and it would not support additional demand so market objectives wouldn't be reached. Exhibit 7 Scenario two: The objective is to sell more units in an exclusive channel.
So as to achieve a higher profit the sales level has to be around 42 MM units for the first year. The Colgate Toothbrush's sales forecast by E at the Niche market is Buy Oral-B Precision Toothbrushes and Replacement Brush Heads with pressure sensors, 2-min timer, charging indicator, stylish and ergonomic design.
1. CP company should launch Precision as a niche product for the below 2 reasons. 1) Not all of the customers are willing to pay high price for the best toothbrush for their oral hygiene, which is the main objective of the Precision (refer to Exhibit 1). CrossAction Precision Clean Floss Action Pro White Sensitive Ortho Care Deep Sweep All of our brush heads deliver the oscillating/rotating power that makes Oral-B the #1 dentist-recommended brand, but there are a few key differences that make each one unique. And, since all of our brush heads fit all of our electric toothbrush handles, it’s easy to find the perfect fit for you. Colgate-Palmolive Company: The Precision Toothbrush Case Analysis Colgate-Palmolive Company (CP) launched a new toothbrush, Colgate Precision, to the market. But having developed for three years, CP was fiercely competing with other companies in the market.
Colgate-Palmolive Co. is considering how to position its new technological toothbrush, Precision.
Branding Emphasizing the Colgate name on the new Precision toothbrush would cause additional cannibalization of the existing Colgate toothbrushes - estimated at 20% Using the Colgate name would be congruent with Colgate’s strategy to build the Colgate brand equity Branding • Emphasizing the Colgate name on the new Precision toothbrush would cause additional cannibalization of the existing Colgate toothbrushes - estimated at 20% • Using the Colgate name would be congruent with Colgate’s strategy to build the Colgate Brand Equity.
Colgate Palmolive Company: The Precision Toothbrush Case Analysis Words | 10 Pages. Colgate-Palmolive Company: The Precision Toothbrush Case Analysis Colgate-Palmolive Company (CP) launched a new toothbrush, Colgate Precision, to the market.
But having developed for three years, CP was fiercely competing with other companies in the market. Colgate-Precision (CP) held the number one position in the US retail toothbrush with 3% volume share in ; they are a global leader in household and personal care products.