Colgate Full Marketing Analysis

®
Submitted by
SIDDHARDHA KARANAM
SID: 306857
as the part of course work for module M04MKT Principles of Marketing

under the guidance of Mr. Mark Goodman and Mr. Balwant Samra
Principles of Marketing – M04MKT 2010
1. Executive summary..........................................................................................................................2
2. Introduction........................................................................................................................................3
3. Colgate’s orientation.........................................................................................................................4
3.1 Conclusion...................................................................................................................................7
4. SWOT analysis..................................................................................................................................7
4.1 Conclusion.................................................................................................................................12
5. Competitive advantage..................................................................................................................12
5.1 Conclusion.................................................................................................................................13
6. Marketing Mix analysis...................................................................................................................13
6.1 4-Ps............................................................................................................................................14
6.1.1 Product Customer solution 14
6.1.2 Price Customer cost 17
6.1.3 Place Convenience 19
6.1.4 Promotion Communication 20
6.2 Additional 3-Ps...........................................................................................................................23

6.2.1 People 23
6.2.2 Physical Evidence 23
6.2.3 Process 23
6.3 Recommendations.....................................................................................................................24
7. References.......................................................................................................................................25
0|Page Coventry University

Table of Figures
1. Figure 1: Net sales of Colgate ……………………………………………………………….. 4
2. Figure 2: Marketing orientation …………….………………………………………………… 7
3. Figure 3: Product-marketing expansion grid ……………..………………………………… 8
4. Figure 4: WTI prices per annum ………………………..……………………...………… ....11
5. Figure 5: 4-Ps of Marketing Mix ……………………………………….………………… ….14
6. Figure 6: Various Colgate toothpaste ……………………………….…………………….17
7. Figure 7: Price, earnings and Dividends of Colgate ……………….…………………….18
8. Figure 8: Price list of Colgate Active Salt in India ………………….…………………….18
9. Figure 9: Supply Chain in Colgate …………………………………….…………………… .19
10. Figure 5: Advertising …………...……………………………………….……………………. 21

1. Executive summary
Colgate-Palmolive Company is a $15.3 billion consumer products worldwide company that

serves people of above two hundred countries and territories. These consumer products make
peoples’ lives healthier, easier and enjoyable. Around 75% of sales are from the global
operations. Colgate-Palmolive’s core businesses are in Oral Care, Personal Care, Home Care
and Pet Nutrition.
The company is leading the business of toothpaste under its brand name Colgate, an oral
hygiene product. The company manufactures a wide range of toothpastes. In 1873, Colgate-
Palmolive Company introduced its first toothpaste Colgate Ribbon Dental Cream in glass jars.
Later in 1896, this toothpaste began to sell in a collapsible tube (Colgate 2007a). Colgate has
successfully ruled about half of the toothpaste market all over the world. This report will be
focusing on Colgate toothpaste of the Colgate-Palmolive Company. The main aim of this report
is to investigate and analyse the marketing activities of Colgate toothpaste.
What is the Colgate’s orientation? What are the strengths, weaknesses, opportunities, and
threats (SWOT) of Colgate? What are the competitive advantages of Colgate? What is the
impact of Colgate’s marketing mix?
This report will try to address all these questions and more.

2. Introduction
Colgate-Palmolive Company is an American multinational corporation of the production,

distribution and provision of households, health care, personal products as well as oral hygiene
products. The company was founded by William Colgate in 1806 and was then named as
‘William Colgate & Company’. After the death of founder in 1857, the company was named as
‘Colgate & Company’ (Colgate 2007a).
During 1864, ‘B.J. Johnson Company’ was developing a new soap consisting palm and olive oil.
This soap became very popular and B.J. Johnson Company went on to change its name to
‘Palmolive Company’. ‘Peet Brothers’, a Kansas based soap manufacturer merged with well-
known ‘Palmolive’ and was named as ‘Palmolive-Peet’. In 1928, ‘Colgate & Company’ was also
merged and the company became ‘Colgate-Palmolive-Peet Company’. However, in 1953, Peet
was dropped from the name and the company is ultimately known as ‘Colgate-Palmolive
Company’ since then (Colgate 2007a).
Colgate is an oral hygiene product and one of the brands of Colgate-Palmolive Company. The
company manufactures a wide range of toothpastes. In 1873, Colgate-Palmolive Company
introduced its first toothpaste in glass jars. Later in 1896, this toothpaste began to sell in a
collapsible tube (Colgate 2007a). Colgate has successfully ruled about half of the toothpaste
market around the globe. Colgate’s nearest competitors are the Procter & Gamble (P&G) i.e.
Crest ® toothpaste and Unilever i.e. Pepsodent ®, Close up ®, and Signal ® (Datamonitor
2008a).

3. Colgate’s orientation
Nature of Demand
Over the century, market for toothpaste has remained constant. Even today, people are highly
concerned about the cavity prevention, whiteness of teeth and odorless teeth. Colgate
frequently comes out with a range of innovative toothpastes and is selling these with top quality
as well as performance (Laird et al n. d.).
Extend of Demand
In 2001, Colgate toothpaste had the sales of about $551.5 million, giving 32.5% share of the
U.S. market and the volume sales raised 3.1% to 233.3 million units sold (Laird et al n. d.).
As shown below is the net sales of Colgate from year 2004 to 2008. We can notice that the
sales are increasing yearly.
FIGURE 1: NET SALES OF COLGATE

(Colgate 2008: 4)
Orientation
Colgate tries to sense the customer needs and demands. This proves that the company is
marketing oriented. Let us now analyze the Colgate’s orientation towards the marketplace.
Companies have their respective beliefs concerning their marketing efforts which are usually

varied from company to company. The challenging concepts beneath which companies perform
their marketing activities are (Kotler and Keller 2006: 15)
 Production Concept: Customers are attracted to those products which are extensively
available and cheaper. Organizations following this concept targets on accomplishing
the large production competence, minimal costs and bulk distribution (Kotler and Keller
2006: 15).
Colgate follows this concept and has proved for the worldwide availability including the
rural areas with global presence in over 200 countries and territories (Colgate 2008).
Colgate products are sold for affordable price. Colgate is leading in toothpaste business
therefore the productivity is high resulting in mass distribution.
 Product Concept: Costumers are attracted to those products which have the best
quality, performance and innovative features. Organizations following this concept
targets on developing advanced innovative products and improving them regularly
(Kotler and Keller 2006: 15).
Colgate strongly follows this concept and has designed their business strategies
accordingly. Colgate prioritizes in innovating new products and improving existing
products by innovative ideas regularly.
 Selling Concept: Organizations embark on robust promotion and selling efforts. This is
followed with unwanted goods (buyers not interested in buying) like insurance,
encyclopedias etc. This is mostly practiced by the organizations with congestion. These
organizations’ only aim is to sell what they have. They do not bother about what the
market demands are (Kotler and Keller 2006: 15).
Colgate does not follow this concept as Colgate focus on what the market demands for.
Colgate produces their products as per the customers’ demands and needs.
 Marketing Concept: This came into sight in the mid 1950s with a philosophy of ‘Sense-
and-respond’ i.e. customer-centered. Earlier the philosophy was ‘Make-and-sell’ which
was product-centered. This concept aims at finding right products for your consumers
rather than finding right consumers for your products. Organization becomes more

valuable compared to their competitors in the means of innovation, delivery and

communication with enhanced customer value (Kotler and Keller 2006: 16).
Colgate follows this concept as well. Colgate tries to sense the customers’ requirements
and respond by developing the products which fulfils all their requirements. Mostly,
Colgate is first to launch unique featured products in the market. Due to this, Colgate
has a tough competition with its competitors like P&G and Unilever who equally trying
hard to introduce new products (Datamonitor 2008a). As time passes the demands of
customers varies so Colgate offers its toothpaste in three key lines to attract aged
customers, adults and kids (Kotler and Keller 2006: 249).
 Holistic Marketing Concept: This involves development, design and implementation of

marketing programs, processes, and activities that recognizes organization’s breadth
and interdependencies. Precisely, this concept is an approach to marketing that tries to
identify and resolve the opportunity and difficulties of marketing activities. There are four
main elements in Holistic marketing namely (Kotler and Keller 2006: 16)
o Integrated marketing involving communications, products & services, channels
o Social responsibility marketing involving Ethics, Environment, Legal and

Community
o Relationship marketing involving Customers, Channel and Partners
o Internal marketing involving Marketing department, senior management and

other departments
Colgate strictly follows this concept as it includes most of the marketing activities.
Colgate’s Business strategies
 Colgate strictly follows the leadership strategy which aims at the main businesses of the
company namely: Oral Care, Personal Care, Home Care and Pet Nutrition (Colgate
2008: 2).
 Globally, all the Colgate employees work together to achieve in Driving Growth, Funding
Growth and become Best Place to Work (Colgate 2008: 2).

 Colgate’s history of robust performance comes from Colgate’s main worldwide

businesses with a victorious worldwide financial strategy. The financial strategy is built to
grow the gross profit margin and drop the costs to fund growth initiatives and produce
higher profitability (Colgate 2008: 2).
3.1 Conclusion
Colgate is a Marketing orientation company. This can be clearly shown below
Potential Marketing
Customer market products Customers
needs
opportunities and services
FIGURE 2: MARKETING ORIENTATION

(Jobber 2007: 6)
4. SWOT analysis
“SWOT analysis is a structured approach for evaluating the strategic position of a business by
indentifying its Strengths, Weaknesses, Opportunities and Threats” (Jobber 2007: 63). To get a
clear idea of Colgate toothpaste’s outlook, it is useful to analyze the company’s as well as the
product’s (toothpaste) Strengths, Weaknesses, Opportunities and Threats (SWOT). Additionally,
a SWOT analysis summarizes the outcome of marketing audit of the company (Jobber 2007:
61).
Strengths
 First to introduce in market: In 1873, Colgate-Palmolive Company introduced its first

toothpaste in glass jars. Later in 1896, Colgate was the first toothpaste which began to
sell in a collapsible tube (Colgate 2007a).
 Brand Image: Strong customer perceptions. Colgate is most reliable and renowned
brand around the globe today. This image would aid in attracting new customers. In
2005, around 14 European countries were participants to name their most reliable
brands in various categories. Colgate was chosen for the most trusted brand in the
toothpaste category with 53% of votes (Jobber 2007: 331).

 Robust market place: Leads the toothpaste market in United States with the market
share of above 35% and also leads in few of the European countries (Datamonitor
2008a).
 Global presence (in above 200 territories and countries): Colgate has successfully ruled
about half of the toothpaste market around the globe (Cadit 2003).
 Performance sustainability: The year 2007 created a history in company by a strong

operating performance. In 2007, company’s revenues increased by 12.7% to $13,789.7
million and the net profit increased by 28.4% (Datamonitor 2008b: 5). Robust financial
performance reinforced the financial position of the company. This gained the
confidence and trust of the company’s partners and shareholders which is very helpful
for the company’s growth.
 Innovative and introducing new products: Colgate prioritizes on product innovation.

The company endeavours to launch new innovative products and also works on creating
innovative ideas to market their existing products (Datamonitor 2008b: 5). Ansoff
proposed the “product-market expansion grid” which can be used for analysing the new
rigorous expansion opportunities (Kotler and Keller 2006: 48).
Current products New products
Current markets 1. Market- Penetration Strategy 3. Product-development strategy
New markets 2. Market- Penetration Strategy (Diversification strategy)
FIGURE 3: PRODUCT -MARKET EXPANSION GRID

(Kotler and Keller 2006:48)
The company operates its oral care’s innovation centre in New York. There are totally
nine innovation centres of the company for different products (Datamonitor 2008b: 5)
Colgate’s Global Innovation Fund encourages their employees to come up with

innovative ideas for which they are waged. The company has also teamed up global
innovation specialists to gather innovative ideas. In 2008, Colgate with Givaudan S. A.

jointly developed the internal fragrance for all the Colgate products (Datamonitor 2008b:
6).
The robust product development and innovation is beneficial in revising the Colgate’s
product line at regular period and this would certainly result in growth of revenue and
customer’s reliance.
 Colgate Business Planning (CBP): CBP is a planning and execution process which
started in 2006 to improve the market margins and shares of the company. This process
assures a constant move to commercial investment throughout and a worldwide
attention on increasing the return on investment. It also let the company to plan the aims
for more than a year in terms of brands and customers. This evaluates the performance
against these parameters and adjusts whenever necessary. Implementation of the
CBP’s first phase namely CBP essentials began in the end of 2007 where around 50
countries were representing above 80% of Colgate’s worldwide trade investment and 6
other countries had finished the entire CBP implementation. In 2008, CBP was
implemented in 12 more other countries (Datamonitor 2008b: 6).
 First International Malaysian Halal Logo: Colgate created a history by being the first
company to acquire the first international Malaysian Halal logo on its Colgate®
toothpaste manufactured in Thailand. Colgate was first who obtained the Halal
certification from Halal Industry Development Corporation (HDC) (Colgate 2009b; Daily
Express 2008).
Weaknesses
 Excessive debt: In 2007, Colgate had a debt of about $3,222 million i.e. equity ratio of
1.47 compared to its competitor P&G whose was 0.53. In 2007, company’s interest
increased to $157 million. Earlier the interest was $136 million in 2005 and $120 million
in 2004. This resulted in an unfavourable consequence on company’s liquidity position
and may perhaps hinder its reliability in the market (Datamonitor 2008b: 7).
 Summon up: In 2007, the company had to summon up two pet products due to issues
with the supply of wheat gluten at a contract manufacturer. Though these products holds
small portion of sale of the total sales but affected the brand value and the operating
profit of the company (Datamonitor 2008b: 6).

Opportunities
 New products: Colgate is keen on constant innovation and introduction of new products
which attracts the customers’ attention and also grows in the range of products with the
increase in market share (Ivythesis Typepad 2008).
 Growing demand of oral products: There is a huge growing demand of the Colgate
oral care products all over the world. Colgate is popular for its oral care products and this
is considered to be the main source for the growth in company’s revenues (Ivythesis
Typepad 2008).
 Widespread marketing: Global customer awareness can be done mostly by marketing.

Colgate is successfully marketing their products regularly. Colgate can grow their
revenues by global marketing which would most probably attract more and more
customers (Ivythesis Typepad 2008).
 Hispanics in U.S: Colgate performs promotional campaign and exclusive marketing to

attract the Hispanic market by television, on-line media and print. The growing
population of Hispanics in U.S. can be the cause of development in Colgate’s revenues
(Datamonitor 2008b: 7).
Threats
 Accusation: Recently, Colgate was accused for the involvement in illegal price-fixing
cartels. Moreover, Colgate and other few companies illegally swapped the data with
retailers regarding ongoing price talks (Datamonitor 2008b: 8).
In 2006, German competition regulator noticed that Colgate planned to increase by 5%

price of all the Colgate toothpaste brands. As Colgate carried out the report of the
cooperative role, Federal Cartel office did not charge any fine on them (Datamonitor
2008b: 8).
Such kind of accusations would surely affect the brand image and high chances of drop
in the market share.
 Losing U.S. customers’ confidence: In recent times, it has been noticed that the U.S.
customers’ confidence on Colgate is continuously dropping. This was based on the
10 | P a g e Coventry University
reports from around five thousand U.S. households. However, this drop has resulted in
the reluctance of customer spending. In 2007, company produced $3,321.5 million i.e.
24% of the total revenue from the U.S. market. This shows that Colgate has extensive
business in U.S. markets and the dropping customers’ confidence would highly distress
the image of all Colgate products (Datamonitor 2008b: 8).
 Costly fuel and raw materials: Colgate requires products which have go through
numerous price fluctuations due to inflations, recessions, external circumstances, and
variations in legal agricultural activities. Colgate had to confront the unpredicted rise in
raw material and packaging money due to the partial evade against product cost
fluctuations. For manufacturing the products, Colgate has to reliant on the energy
suppliers. Additionally, the distributors and shipping firms are reliant on the gasoline and
diesel (Datamonitor 2008b: 8).
As per the prediction of the US Energy Information Administration, the following table
shows the West Texas Intermediate (WTI) prices for recent 3 years (Datamonitor 2008b:
8).
Year WTI price
2007 $72 per barrel
2008 $122 per barrel
2009 $126 per barrel
FIGURE 4: WTI PRICES PER ANNUM

(Datamonitor 2008b: 9).
Since the company has a huge distribution network, increased fuel cost is most likely to have a
straight impact. This will affect the margins of Colgate. The company will be unable to grow in
the costs of raw materials which results in low profits and operations.
 Competitors: There are a couple of companies who are toughly competing with Colgate
toothpaste. These competitors are also working hard in introducing new products and in
increasing their market share. The nearest competitor of Colgate toothpaste is Crest of P&G
and other being Unilever (Ivythesis Typepad 2008).
 Forex risks: Since, Colgate is spread worldwide in around 200 countries and territories;
there are huge threats in the business operations. This is also one of the vital reason for
which the company would be extensive affected (Ivythesis Typepad 2008).
 Counterfeit Colgate toothpaste: In 2007, U.S. Food and Drug Administration announced
that the Colgate–Palmolive Company were alerting about the counterfeit Colgate toothpaste.
It is been noticed that the toothpastes are deceptively packaged as “Colgate” which was
found in various dollar-type discount provisions in New York, New Jersey, Pennsylvania,
and Maryland. The company clearly mentioned that the counterfeit toothpastes are not
distributed or manufactured by the Colgate-Palmolive Company (U.S. Food and Drug
Administration 2007; MSNBC 2007).
Recently, from 28 November to 5 December, two major retailers Sainsbury’s and Boots
were swindled in selling the counterfeit Colgate toothpaste (Telegraph 2008).
This is a serious threat for the company as counterfeit toothpastes may contain harmful
ingredients and mar the brand image. Additionally, this reflects the financial status of the
company.
4.1 Conclusion
Colgate has to maintain all their strengths and grab all the opportunities. On the other hand,
Colgate should sooner overcome all its weaknesses and work harder on the threats.
5. Competitive advantage
“Competitive advantage is the achievement of superior performance through differentiation to

provide superior customer value or by managing to achieve lowest delivered cost” (Jobber
2007: 27). Colgate follows the strategy of increasing the market leadership positions for its main
products. Due to this strategy, the company is delivering vigorous worldwide growth. The key
products of the company are toothpaste, toothbrushes, bar and liquid soaps,
deodorants/antiperspirants, dishwashing detergents, household cleaners, fabric conditioners
and specialty pet food (Colgate 2008: 2).
Colgate is more than a century old company and have since then been the well-known for its
innovative products. Colgate’s oral care is the only sector of many that leads in the market by
producing the huge gross margins (Cadit 2003). Colgate’s lead is a vital strength and bestows a
substantial competitive advantage compared to its competitors: P&G and Unilever (Datamonitor
2008a).
Being first in market is a great opportunity to rule the market as well as a clear advantage for the
business. Colgate was first to introduce toothpaste in a collapsible tube (Colgate 2007a).
Colgate is first to have the first international Malaysian Halal logo on Colgate toothpaste
packaging (Colgate 2009b; Daily Express 2008). Introduction of Colgate Business planning
(CBP) was a powerful and profitable for the company. Colgate’s innovation for new products
and existing products is remarkable worldwide. The global presence of Colgate comforts the
customers for buying. Colgate leads in the toothpaste business and owns high market place.
The brand image of Colgate is a strong perspective for the customers (Datamonitor 2008b).
Importance of marketing has also played a vital role in Colgate’s growth which is incredibly a
Competitive advantage. Colgate focuses mainly on advertising and have been spending lots
day-by-day (Colgate 2007b).
5.1 Conclusion
All the strengths and opportunities of Colgate are the competitive advantages.
6. Marketing Mix analysis
Marketing strategy is generally obtained by the 3 key elements namely the target markets,
competitors’ targets and the competitive advantage (Anderson 2008). Once the marketing
strategy is finalized, the company starts looking into the facts of the marketing mix. “Marketing
mix is the set of controllable, tactical marketing tools that the firm blends to produce the
response it wants in the target market.” (Armstrong and Kotler 2009). The brand image is
obtained by utilizing the fundamentals of marketing mix (Jobber 2007: 332).
6.1 4-Ps
Marketing mix is essential for the company to develop the demand for its products. This can be
collectively done by the four vital categories which are well-known as 4-Ps of marketing mix.
The 4-Ps are namely Product, Price, Place and Promotion (Armstrong and Kotler 2009: 83).
PRODUCT PRICE
Variety List price
Quality Discounts
Design Allowances
Features Payment period
Brand name Credit terms
Packaging
Services Target customers
Intended
PROMOTION Positioning PLACE
Advertising Channels
Personal selling Coverage
Sales promotion Assortments
Public relations Locations
Inventory
Transportation
Logistics
FIGURE 5: 4-PS OF MARKETING MIX

(Armstrong and Kotler 2009: 83)
6.1.1 Product Customer solution
“Product is a good or service offered or performed by an organization or individual, which is

capable of satisfying customer needs” (Jobber 2007: 28). Colgate toothpaste is the product that
appends importance to the customers’ lives (Pauszek n. d.).
Brand name and Quality
Quality comes first when the company is product oriented. Colgate toothpaste’s quality factors
are meticulously tested to guarantee consumer satisfaction. Colgate has proved for the best
quality by the huge number of customers and constant demand for its products. Recently,
Colgate launched new toothpaste Colgate Luminous™ which is selling in high demand. Colgate
toothpastes have led the Colgate-Palmolive Company in the oral care sector and also generate
the maximum gross margins (Foolonahill n. d.).
There is a strong customer perception for Colgate products. Colgate is now the most reliable
and renowned brand. In 2005, 14 European countries participated to vote for their most reliable
brands in various categories. Colgate with highest votes (53%) in toothpaste category was
chosen as the most trusted brand (Jobber 2007: 331). Colgate is 58 th among the top 100 global
brands (Business Week n. d.). This shows how powerful and popular the Colgate brand is for all
its products especially for the Colgate toothpastes. Each and Every brand of toothpaste
specifies about its unique feature in the product. For Example: Colgate Herbal White toothpaste
– ‘Herbal’ in the brand name is clear and the ‘White’ in brand name highlights the assurance of
‘pearly white teeth’ (Foolonahill n. d.).
Features and Variety
Colgate mainly focuses on innovation. They come up with new innovative products having
unique features and also improve the existing products by appending new differential features.
For example: Colgate Herbal White toothpaste assures of a ‘unique formula’ which involves a
particular blend of eucalyptus, calcium, minerals and lemon extracts (Foolonahill n. d.). Likewise
all the Colgate toothpastes have their respective unique formulae. Colgate toothpastes contain
original baking soda with total protection compared to other toothpastes (Oup n. d.).
Colgate’s kid’s toothpastes have unique features which attract the children to brush for long and
more frequently (Kotler and Keller 2006: 267).
As the Colgate is keen on more and more innovation with numerous features, Colgate has a
variety of toothpastes. List of the global brands in Colgate toothpastes are as follows (Colgate
2008: 3)
 Colgate Total® Advanced
 Colgate Triple Action
 Elmex
 Kolynos
 Meridol
 Sorriso
 Tom’s of Maine
 Colgate Total®
 Colgate® Max Fresh®
 Colgate® Sensitive
 Colgate® Tartar Protection
 Colgate
 Colgate Fresh Confidence
 Colgate Herbal
 Colgate Propolis
 Colgate Simply White
 Ultra brite ®
 Colgate Luminous™
 Colgate® Visible White®
 Colgate® 2in1
 Colgate® Sparkling White
 Colgate® Baking Soda & Peroxide Whitening Oxygen Bubbles
 Kids Toothpastes
Design and Packaging
Colgate’s focus on innovation also concentrates on the product designs and their packaging. As
shown below are the few of many varieties of Colgate toothpastes with outstanding innovative
designs and packaging. We can see the uniqueness of each and every product with different
style, colours and names. This proves how Colgate is keenly working on attracting the
customers and understanding the new generation.
FIGURE 6: V ARIOUS COLGATE TOOTHPASTES

(Colgate 2007)
For example: Colgate Herbal White toothpaste’s green-colored packaging boosts the herbal
ingredients, the pneumonic of mint leaves, lemon and eucalyptus complements the ingredients
in the toothpaste. The two bright colours red and blue (word ‘new’) are examined to attract
customers’ eye in the stores (Foolonahill n. d.).
Quantities of the toothpaste available in the market are mostly in three sizes - 50g, 100g and
200g (Foolonahill n. d.).
6.1.2 Price Customer cost
“Price is the amount of money customers must pay to obtain the product.” (Armstrong and
Kotler 2009: 83). The price of any product partially highlights its quality. Although the Colgate
toothpaste’s quality leads in the toothpaste category globally, the price of the toothpaste is fixed
only after clearly examining the prices of other leading toothpastes which are already in the
market or will be launched soon in the market. This strategy of pricing, aids in positioning the
toothpaste as a conventional product than a niche product (Laird et al n. d.).
Below shown are the price, earnings and dividends chart of the Colgate-Palmolive Company
from the year 2003 to 2008.
FIGURE 7: PRICE , EARNINGS AND DIVIDENDS OF COLGATE

(Corporate Information n. d.)
List price
Let us consider one of the Colgate toothpaste for the discussion of list price. Colgate Active salt
- The list price of this toothpaste in India is shown below for different quantities.
Size of Colgate toothpaste Price (in Indian Rupees)

(in grams)
50 g Rs. 13
100g Rs. 26
200g Rs. 47
FIGURE 8: PRICE LIST OF COLGATE ACTIVE SALT IN INDIA

(Colgate 2009)
Discounts and/or Allowances
There are not many discounts and allowances for the Colgate toothpastes (Foolonahill n. d.).
Payment period and/or Credit terms
As Colgate is one of the companies for the Fast Moving Consumer Goods (FMCG) especially in
toothpaste category, credits are not allowed. Even though the retailers allow credit on purchase
for all the items, however no credits allowed for Colgate toothpaste (Foolonahill n. d.).
Warranties and Returns – These facilities are not offered for the Colgate toothpastes
(Foolonahill n. d.).
6.1.3 Place Convenience
“Place includes company activities that make the product available to target consumers.”
(Armstrong and Kotler 2009). The vital role of marketing is the process of how the product is
being sent from seller to buyer. Through the dentists, stores, pharmacies etc, distribution
strategy is been offered to the Colgate (Pauszek n. d.).
Channels
The Colgate toothpastes are sold in retail outlets like supermarkets, malls, pharmacy, co-
operative stores etc. The products are distributed by the Colgate’s supply chain as shown below
(Foolonahill n. d.).
Distributors Wholesalers Retailers Consumers
FIGURE 9: SUPPLY CHAIN IN COLGATE

(Foolonahill n. d.)
Coverage
Colgate toothpastes are available in almost all countries around the globe. Colgate serves
people of above two hundred countries and territories. Now, their market also includes the semi-
urban and rural areas where the company is primarily focusing on (Foolonahill n. d.).
Locations
Colgate has successfully ruled about half of the toothpaste market around the globe. Colgate
serves people of above two hundred countries and territories. Colgate toothpastes can found
easily in any store. They are placed in oral care section in every store. In few places the
products of lowest quantity are placed near the payment counter on a trial basis (Foolonahill n.
d.).
Inventory
The retailers’ stocks vary by its size (Foolonahill n. d.).
Logistics
Colgate sets a remarkable standard for the on-time delivery of products and make sure that the
products meets the customers’ demands. Colgate’s customer services department are doing
well and are in-force for tracking the customers by getting feedbacks from them. Colgate
mentions their details on the packaging and gives the details of contacting them like contact
number, email address, website etc through which the customers can discuss their experience
of using Colgate product (Kotler and Keller 2006).
6.1.4 Promotion Communication
“Promotion means activities that communicate the merits of the product and persuade target
customers to buy it.” (Armstrong and Kotler 2009). Widespread promotion of Colgate products
has made it a synonym to toothpaste (Wa In U.S., Colgate employed extremely embattled
incorporated marketing campaign which involves TV, print advertising, assortment of
promotional events and on-line contents (Colgate 2007).
Advertising
Advertising involves internet, print, outdoor, broadcast etc (Armstrong and Kotler 2009: 383).
In 2004, Colgate invested large budget examining new on-line advertising campaign to realize
the competence of appending on-line advertising to media mix. On this, E-business director of
Colgate Palmolive, Gabi Stade said: "The objective is to test whether including online within the
media mix works more efficiently than TV and traditional media alone. At Colgate-Palmolive we
are always keen to push the boundaries of the marketing mix while being sure to track any
innovations to assess their effectiveness." (Whitehead 2004).
In 2007, growth in gross profit margin and saving programs supported in the development of
advertising for introducing new products and improvement in market shares globally. In Brazil, a
mix of robust advertising focused on the benefits of the products, endorsements and
testimonials. During 2007, 20% of the total toothpaste sales are from the Brazil whereas four
years later the sales were just 1% (Lee and Johnson n. d.). The importance and growth of
advertising the Colgate products is shown below. We notice that company is spending lots for
advertising so the budget increases yearly.
FIGURE 10: ADVERTISING

(Colgate 2007b: 3)
Few of the advertising slogans of Colgate toothpaste:
 Colgate toothpaste (1945)
Advertising slogan: “It cleans your breath while it cleans your teeth” (Wininspiration n. d.).
 Colgate toothpaste (1967)
Advertising slogan: “The Colgate ring of confidence” (Wininspiration n. d.).
 Colgate Total toothpaste
Advertising slogan: “Number 1 recommended by dentists.” (Textart n. d.).
 Colgate Oxygen toothpaste
Advertising slogan: “Pure. Fresh. Clean.” (Textart n. d.).
Translation disaster of one of the Colgate toothpaste: In France, Colgate launched toothpaste
called "Cue", unfortunately it happen to be the name of a popular porno magazine (The
University of Texas at Austin 2009).
Colgate is attracting the growing population of Hispanic in U.S. by printing the ads in Spanish.
Colgate focuses on advertising their products in rural areas (example: India) where the people
are almost unaware of the products (Lee and Johnson n. d.).
On October 2006, Colgate posted online advertisement on yahoo homepage. This resulted in
increase of visitors to yahoo 94 million and the traffic to the Colgate Total site increased to
2000% (Kramer 2007).
Personal selling
Personal selling involves incentive programs, sales presentations and trade shows (Armstrong
and Kotler 2009: 383).
Colgate has advertised their toothpaste products on the show where the audience sang in the
upbeat tube where the spokeswomen adorned about the virtues of Colgate Tartar Control
toothpaste in Spanish. This was targeted to attract the growing population of Hispanic in U.S.
(Lee and Johnson n. d.).
Sales promotion
Sales promotion involves demonstrations, discounts, displays and coupons (Armstrong and
Kotler 2009: 383).
By 2003, the company expected rural India to draw above half of the revenue as company had
spent 5 times more of it for marketing in rural areas. Many of the rural Indians were not aware of
the toothpaste tubes. Less than 15% of rural Indians were using the dentifrice. Since ages to
clear their mouths, rural Indians were using the charcoal powder and indigenous plants. Colgate
showed the infomercial video to the people and also offered them free samples. They marketed
by the subtext of “Colgate is good for your breath and teeth”. They also demonstrated how to
use the toothpaste with toothbrush. To encourage and attract the people to buy Colgate
toothpaste, Colgate offered free toothbrushes to few children (Lee and Johnson n. d.; Kotler and
Keller 2006: 671). Colgate offers coupons via on-line with the help of several on-line coupon
sites (Kotler and Keller 2006: 588).
Public relations
Public relations involves web pages, press releases, special events and sponsorships
(Armstrong and Kotler 2009: 383).
On April 2008, Colgate declared regarding an exclusive online promotion of Mother's Day
featuring Mary Mary’s music (Grammy award-winning Gospel duo). By taking part in the
promotion of "Send Her A Colgate Smile!", customers could tribute their mothers with a musical
E-card which had an inspiring Mother’s Day song with a verse from A Mother's Smile. This song
was specially written for Colgate and was performed by Mary Mary (Target Market News 2008).
Colgate has their official worldwide websites where the company regularly updates information
such as yearly annual report, products, interviews with management faculties etc. The website
is www.colgate.co.uk.
Since 18 years, Colgate is marketing to the elementary schools through its Bright Smiles, Bright
Futures program (Event marketer 2009).
6.2 Additional 3-Ps
The additional 3-Ps (People, Physical Evidence and Process) affects the distinctive
characteristics of service ‘product’.
6.2.1 People
The people mean the customers and/or employees of the Company. “Valuing Colgate People"
is a training program for employees introduced in Colgate to motivate people of all race and
religion. This aids to achieve goals, corporate objectives of Colgate, to be aware of their values
and how to respect others for their contributions (Colgate 2009).
6.2.2 Physical Evidence
There is no much physical evidence of Colgate toothpaste.
6.2.3 Process
Colgate’s customer services department are doing well and are in-force for tracking the
customers by getting feedbacks from them. Colgate mentions their contact details on the
packaging like contact number, email address, website etc through which the customers can
discuss their experience of using Colgate products (Kotler and Keller 2006).
6.3 Recommendations
We recommend that Colgate promote more of their products commercially, with magazine ads,
in the radio, ads in dental clinics/ hospitals, dental colleges/universities, in billboards, and on
sides of public transportation (coaches/buses). We also recommend Colgate to offer more of
special coupons, discounts and rebates to their customers. Colgate could be beneficial when
there are in-store displays (Pauszek n. d.). Colgate should work on the physical evidence as it
is equally important for public awareness of the products.
7. References
Anderson, R. (2008) Marketing Strategy Lecturer delivered for Module M70EKM on November
2008 at Coventry University
Armstrong, G. and Kotler, P. (2009) 9th edn. Marketing: An Introduction. New Jersey: Prentice
Hall
Business Week (n. d.) Best Global Brands [online] Available from
<http://images.businessweek.com/ss/06/07/top_brands/source/58.htm> [19 March
2009]
Cadit (2003) With Invention Machine, Colgate-Palmolive Discovers New, More Cost-Effective
Approach to Engineering Problem [online] Available from
<http://www.cadit.com.sg/solutions/invention/CaseStudies/InventionMachine_Colgate-
Palmolive.pdf> [19 March 2009]
Colgate (2007) Toothpaste [online] Available from <

http://www.colgate.com/app/Colgate/US/OC/Products/Toothpastes/Name.cvsp> [15
March 2009]
Colgate (2007a) History [online] Available from

<http://www.colgate.com/app/Colgate/US/Corp/History/1806.cvsp> [17 March 2009]
Colgate (2007b) Key to our future: Powerful strategies, sharp focus [online] Available from
<http://investor.colgate.com/downloads/2007AR.pdf> [17 March 2009]
Colgate (2008) Colgate’s World [online] Available from

<http://investor.colgate.com/ColgateWorld/colgate_world.cfm?header=fin> [16 March
2009]
Colgate (2009) Valuing Colgate People [online] Available from

<http://www.colgate.com/app/Colgate/US/Corp/LivingOurValues/ValuingColgatePeople
.cvsp> [19 March 2009]
Colgate (2009a) Colgate-Palmolive Launches a New Toothpaste with the Power of Active Salt
[online] Available from
<http://www.colgate.co.in/app/Colgate/IN/Corp/PressRoom/Product.cvsp?
newsArticle=News_170805> [19 March 2009]
Colgate (2009b) Now with the Malaysian Halal Logo [online] Available from
<http://www.colgate.com.my/app/Colgate/MY/OC/Halal.cvsp?Section=OralCare> [18
March 2009]
Corporate Information (n. d.) Colgate-Palmolive Co. [online] Available from

<http://www.corporateinformation.com/Company-Snapshot.aspx?cusip=194162103>
[15 March 2009]
Daily Express (2008) First international Halal logo on Colgate packaging soon [online] Available
from <http://www.dailyexpress.com.my/news.cfm?NewsID=57512> [18 March 2009]
Datamonitor (2008a) Company Spotlight: Colgate-Palmolive [online] Available from

<http://web.ebscohost.com/ehost/pdf?vid=3&hid=106&sid=0110440a-91fd-4a0d-98c0-
b22ede6672d6%40sessionmgr109> [19 March 2009]
Datamonitor (2008b) Colgate-Palmolive Company [online] Available from

<http://web.ebscohost.com/ehost/pdf?vid=2&hid=151&sid=f6d833e9-c5e4-4628-b433-
7e717570e127%40sessionmgr103> [19 March 2009]
Event marketer (2009) Making The Grade [online] Available from

<http://www.eventmarketer.com/viewmedia.asp?prmMID=2343&prmID=1> [19 March
2009]
Foolonahill (n. d.) The marketing mix – Colgate Herbal White Toothpaste [online] Available from
<http://www.foolonahill.com/mbacolgateherbal.html> [18 March 2009]
Jobber, D. (2007) 5th edn. Principles and Practice of Marketing. Berkshire: McGraw-Hill
Kotler, P. and Keller, K. L. (2006) 12th edn. Marketing Management. New Jersey: Prentice Hall
Kramer, L. (2007) In a Battle of Toothpastes, It’s Information vs. Emotion [online] Available from
<http://www.nytimes.com/2007/01/17/business/media/17adco.html?_r=1> [19 March
2009]
Laird, M. et al (n. d.) Colgate Palmolive The precision toothbrush [online] Available from
<http://www.wherestheplug.com/MarketAnalysisofColgatePalmOlive.htm> [19 March
2009]
Lee, M. and Johnson, C. (n. d.) Principles of advertising: A global perspective [online] Available
from <http://books.google.com/books?id=3TjXcAKGKUIC&pg=PA97&dq=colgate-
+pamolive+marketing&ei=t3u1SfuVHJXWNoHlvN0P#PPA100,M1> [19 March 2009]
MSNBC (2007) Counterfeit Colgate toothpaste recalled [online] Available from

<http://www.msnbc.msn.com/id/19214360/> [18 March 2009]
Oup (n. d.) Developing the marketing mix: Competitor analysis and development of a brand
[online] Available from
<http://www.oup.com/uk/orc/bin/9780199266272/palmerch06.pdf> [19 March 2009]
Pauszek, K. (n. d.) Colgate-Palmolive Case-Marketing Plan [online] Available from

<http://www.franklincollege.edu/pwp/kpauszek/Marketingplan.pdf> [19 March 2009]
Target Market News (2008) Colgate launches online Mother's Day promotion with gospel duo
Mary Mary [online] Available from
<http://www.targetmarketnews.com/storyid04280802.htm> [19 March 2009]
Telegraph (2008) Tubes of fake Colgate toothpaste recalled [online] Available from
<http://www.telegraph.co.uk/finance/newsbysector/retailandconsumer/3933094/Tubes-
of-fake-Colgate-toothpaste-recalled.html> [18 March 2009]
Text Art (n. d.) Database of slogans. Advertising slogans for toothpaste [online] Available from
<http://www.textart.ru/advertising/slogans/toiletries/toothpaste-slogans.html> [17 March
2009]
The University of Texas at Austin (2009) Lost in the translation [online] Available from
<http://advertising.utexas.edu/resources/humor/PROD75_016489.html> [18 March
2009]
U.S. Food and Drug Administration (2007) Counterfeit Colgate toothpaste found [online]
Available from <http://www.fda.gov/oc/po/firmrecalls/colgate06_07.html> [18 March
2009]
Whitehead, J. (2004) Colgate to research impact of online ads in media mix [online] Available
from <http://www.brandrepublic.com/News/211948/Colgate-research-impact-online-
ads-media-mix/?DCMP=ILC-SEARCH> [19 March 2009]
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<http://www.winspiration.co.uk/slogans.htm> [19 March 2009]

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as the part of course work for module M04MKT Principles of Marketing

6.1.2 Price Customer cost 17

6.1.3 Place Convenience 19

6.1.4 Promotion Communication 20

6.2 Additional 3-Ps...........................................................................................................................23

6.2.2 Physical Evidence 23

0|Page Coventry University

1. Figure 1: Net sales of Colgate ……………………………………………………………….. 4

2. Figure 2: Marketing orientation …………….………………………………………………… 7

3. Figure 3: Product-marketing expansion grid ……………..………………………………… 8

4. Figure 4: WTI prices per annum ………………………..……………………...………… ....11

5. Figure 5: 4-Ps of Marketing Mix ……………………………………….………………… ….14

6. Figure 6: Various Colgate toothpaste ……………………………….…………………….17

7. Figure 7: Price, earnings and Dividends of Colgate ……………….…………………….18

8. Figure 8: Price list of Colgate Active Salt in India ………………….…………………….18

9. Figure 9: Supply Chain in Colgate …………………………………….…………………… .19

10. Figure 5: Advertising …………...……………………………………….……………………. 21

1|Page Coventry University

Colgate-Palmolive Company is a $15.3 billion consumer products worldwide company that

2|Page Coventry University

Colgate-Palmolive Company is an American multinational corporation of the production,

3|Page Coventry University

FIGURE 1: NET SALES OF COLGATE

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valuable compared to their competitors in the means of innovation, delivery and

 Holistic Marketing Concept: This involves development, design and implementation of

o Integrated marketing involving communications, products & services, channels

o Social responsibility marketing involving Ethics, Environment, Legal and

o Relationship marketing involving Customers, Channel and Partners

o Internal marketing involving Marketing department, senior management and

Colgate’s Business strategies

6|Page Coventry University

 Colgate’s history of robust performance comes from Colgate’s main worldwide

Colgate is a Marketing orientation company. This can be clearly shown below

FIGURE 2: MARKETING ORIENTATION

 First to introduce in market: In 1873, Colgate-Palmolive Company introduced its first

7|Page Coventry University

 Performance sustainability: The year 2007 created a history in company by a strong

 Innovative and introducing new products: Colgate prioritizes on product innovation.

Current products New products

Current markets 1. Market- Penetration Strategy 3. Product-development strategy

New markets 2. Market- Penetration Strategy (Diversification strategy)

FIGURE 3: PRODUCT -MARKET EXPANSION GRID

Colgate’s Global Innovation Fund encourages their employees to come up with

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 Widespread marketing: Global customer awareness can be done mostly by marketing.

 Hispanics in U.S: Colgate performs promotional campaign and exclusive marketing to

In 2006, German competition regulator noticed that Colgate planned to increase by 5%

Year WTI price

2007 $72 per barrel

2008 $122 per barrel

2009 $126 per barrel

FIGURE 4: WTI PRICES PER ANNUM

“Competitive advantage is the achievement of superior performance through differentiation to

6. Marketing Mix analysis

FIGURE 5: 4-PS OF MARKETING MIX

6.1.1 Product Customer solution

“Product is a good or service offered or performed by an organization or individual, which is

Brand name and Quality

Features and Variety

 Colgate Total® Advanced