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Colgate Precision Toothbrush Case Study Analysis

Colgate Precision Toothbrush Case Study Analysis

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Published by binzidd007
Case Study – Colgate Precision Toothbrush

Section C – Group 11

Colgate Precision Toothbrush Section - C Group – 11
Name Aman Srivastava Deepak Sudhakar Krishna Bajaj Prasanna Patange Richa Singh Saikiran Pollamarasetty Vivek Gupta Roll Number PGP2011532 PGP2011617 PGP2011696 PGP2011770 PGP2011823 PGP2011843 PGP2011944

PGP 2011-13

Page 1

Case Study – Colgate Precision Toothbrush

Section C – Group 11

SWOT analysis for Colgate-Palmolive Precision: Strengths: Colgate-Palmolive is a global le
Case Study – Colgate Precision Toothbrush

Section C – Group 11

Colgate Precision Toothbrush Section - C Group – 11
Name Aman Srivastava Deepak Sudhakar Krishna Bajaj Prasanna Patange Richa Singh Saikiran Pollamarasetty Vivek Gupta Roll Number PGP2011532 PGP2011617 PGP2011696 PGP2011770 PGP2011823 PGP2011843 PGP2011944

PGP 2011-13

Page 1

Case Study – Colgate Precision Toothbrush

Section C – Group 11

SWOT analysis for Colgate-Palmolive Precision: Strengths: Colgate-Palmolive is a global le

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Published by: binzidd007 on Dec 16, 2012
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Case Study
 –
Colgate Precision Toothbrush Section C
 –
Group 11
PGP 2011-13 Page 1
Colgate Precision ToothbrushSection - CGroup
 –
11
Name Roll NumberAman Srivastava PGP2011532Deepak Sudhakar PGP2011617Krishna Bajaj PGP2011696Prasanna Patange PGP2011770Richa Singh PGP2011823Saikiran Pollamarasetty PGP2011843Vivek Gupta PGP2011944
 
Case Study
 –
Colgate Precision Toothbrush Section C
 –
Group 11
PGP 2011-13 Page 2
SWOT analysis for Colgate-Palmolive Precision:Strengths
: Colgate-Palmolive is a global leader in personal care and household products with43% of the world
’s
toothpaste market and 16% of the world
’s
 
toothbrush market. CP’s
international sales, which account for 64% and 67% of profit (by volume and dollarsrespectively), showcase their brand image worldwide. Precision launched by CP is a technicalinnovation, which has a triple-action brushing effect that increases plaque removal by 35%more, as compared to other brands. Concept tests revealed that 77% found precision muchmore effective than their current toothbrush.
Weakness
: Since 33% of adults were uninvolved oral health consumers it will be difficult toeducate them about the importance of Precision as a toothbrush that prevents gum disease. CPis not yet into the super-premium toothbrush category while
CP’s main competitor Oral
-B has
professional endorsements as dentist’s toothbrush.
 
Opportunities
: CP’s consumer research revealed that 46%
of adult consumers are concernedabout the health of their gums and are willing to pay premium for new products addressing theissue. Also consumers are willing to experiment with new toothbrushes.
Threats
: Competitors are offering incentives such as buy-one-get-one-free, mail in refundcoupon deals and toothbrush on pack with toothpaste. Moreover, competitors are planning tolaunch their products with added features. Johnson & Johnson is coming up with reachbetween features like angled neck and rippled bristles. Procter & Gamble are preparing tolaunch Crest Complete with features like long, rippled bristles. Smith Kline Beecham byexpanding Aquafresh Flex line to include two adult compact heads and one child brush.
Changes in the Toothbrush Category
Traditionally, toothbrush was largely perceived to be a commodity and was purchased primarilyon the basis of price. During the 1980s, several product innovations introduced some tangiblebenefits and since then these benefits have become significant purchase criteria.Gillette owned Oral B was the first to introduce some extent of product differentiation byintroducing a soft-bristle brush, which was better for gums. Following
Oral B’s l
ead, severalother companies began introducing certain variations so as to develop recognition of theirproducts amongst consumers. Broxodent had introduced the first electric toothbrush, whichwas closely pursued by other companies introducing variations in the design, length and bristlequality of toothbrushes. During the period 1985 and 1992, these innovations were introducedrapidly within brands such as Oral-B, Johnson and Johnson, Colgate, Pepsodent, Aquafresh,Crest and Pfizer, as they competed to grab significant market share.Over the years, the U.S. Oral Care market had registered an approximate growth rate of 6% toreach $2.9 billion in 1991. Sales of toothbrushes had increased at 9.3% per annum, since 1983and in 1992, sales increased by an impressive 21% per annum in value and 18% in volume, withthe introduction of several new products and line extensions. The new products were at one
 
Case Study
 –
Colgate Precision Toothbrush Section C
 –
Group 11
PGP 2011-13 Page 3
hand placed in high price niche segment offering aesthetic, therapeutic and cosmetic value,while others were placed in the mainstream segment for the masses.
Competitive Analysis
There is considerable fragmentation in the market and hence, there is severe competitionamongst the players. In order to get an edge, competitors, Johnson & Johnson, Oral-B, Procter& Gamble, and Smithkline Beecham, are offering promotions in the form of coupons, mail-in
refunds and discounts. The company’s competition may be analyses on the basis of stock
keeping units (SKUs) and on the basis of the price segments. The company faces toughcompetition in super premium segment from companies such as Oral-B, Reach AdvancedDesign, Crest and Aquafresh Flex. In addition, all companies spend a sizeable share of theirrevenues on advertisement, which adds up to the competition. Also, the players have beenfairly lenient in allowing other players to enter into the market, fostering competition. Playershave exhibited some slackness on their parts, by remaining ignorant to some of thetechnological advancements and shift in consumer behavior. As an instance, in 1988, Johnson &
Johnson introduced “new brush technology” only to phase it out by 1992. Hence there are
healthy competitions in the market.
Product Segmentation:
 
On basis of Price: Toothbrush industry is divided into mainly three segments on the basis of price: Value, Professional and Super Premium.Value brushes priced average at $1.29 accounted for 24% of unit volume and 12% of dollarsales on the other hand Professional brushes, priced between $1.59 and $2.09, account forcorresponding 41% and 42%. Super Premium brushes category emerged in late 1980s and by1992, its retail prices were between $2.29 and $ 2.89 and it accounted for 35% of unit volumeand 46% of dollar sales.
 
On the basis of attributes: In this, toothbrush differed by bristle type( firm, medium, soft ,and extra soft) and by head size( full/adult, compact , and child/youth)
Demographic Segmentation
:In this market is divided into groups on the basis of variables such as age, family size, family lifecycle etc. They are often associated with consumer needs and wants and are easy to measure.In 1980s, toothbrush industry had market on the basis of adult and child aesthetic. The childrensegment had variety of new products like brushes with sparkling handles, bugs and bunny etc.and later new products mainly focused on technical performance improvements.
Psychographic Segmentation:

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