Segmentation Targeting Positioning

Colgate Case Study

Question 1) What changes are occurring in the toothbrush category? Asses CP’s competitive position.

Answer1) Design:-

The tooth brush designs are evolving.

The volume share & value share is fluctuating as per the strategy and spends for the marketing & advertising.

The mindset is changing as per the evoluition of design which does not concentrate on just cleaning the surface but also inner teeth, gums and between the teeth space which is making customers more inclined to other benefits of design.

Customer mindset:

The companies are going full throttle on marketing spends due to which they are creating more awareness in the masses

The mentality of price wise buying is changing in customers due to awareness created in terms of designs and its benefits.

Companies are coming up with superior priced and designed toothbrushes to meet evolving customer mindset

The usage frequency is increasing hence reflecting the same on sales and market share.

Companies are researching various marketing channels possible and short listing the best suited as per price and category of toothbrushes.

During this time CP was struggling with the kind of positioning to be done for its already lab proven Super premium toothbrush “Precision” only to minimise its cannibalisation effect on its already existing “value” brands.

Colgate was a leading brand until 1991 however due to extreme marketing strategies and innovation they landed around 3rd position in 1992. So they need to come up with precise and calculative positioning to regain their first spot with their new brand “Precision”

Question 2) How is toothbrush market segmented? Compare consumer behaviour for toothbrush & toothpaste.

Segmentation:-

“Value” & “Professional”

Pricing

Design ( Angled, flexi handle, smaller head, narrowing head, rippled bristle, indicator bristle)

Bristle ( Firm. Medium, soft and extra soft)

Technical advantages ( plaque removal, angular cleaning, behind the teeth cleaning, gums cleaning, between the teeth cleaning)

Consumer behaviour changed with time with regards to frequency of buying new toothbrushes. Many agreed it was an impulsive purchase but most of them were moving towards conscious purchase based on technical advantage.

Toothpastes were usually shared unlike toothbrushes in households hence the experimentation mentality remained towards the tooth brushes and not much change could be bought in the toothpaste buying mentality.

Also the tooth brush sales accounted for more sales percentage as compared to toothpastes.

Colgate- Palmolive: The competition is fast paced as the newer brands have grown quickly based on innovative design and competitive pricing.

Oral-B launched Oral-B Indicator which took the market by surprise due to its indicator color that prompts the customer when to change their toothbrush without consulting an expensive dentist.

To beat that J&J introduced Prevent which was different in design claiming since its angular it can give more area for cleaning.

P&G came up with crest stating its rippled bristles can reach beyond the normal toothbrush.

Beecham happened to disrupt the market by fierce competitive price and marketing budget and also ready to incur operating losses to achieve market share.

Even fairly small and new players like Lever Pfizer & Sunstar also started marketing big time.

There were massive offers like “two for one”, on-pack ( brush with toothpaste) and coupons which worked well for the promotions.

Question 3) What are the arguments for launching “Precision” as (A) Niche Product (B) Mainstream Product

Niche Product

Mainstream Product

Command 15% Premium over competitors

Broader appeal of effective brush

Capture 3% of market share