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SCOPE OF THE REPORT
All values expressed in this report are in US dollar terms, using a fixed exchange rate (2010). 2010 figures are based on part-year estimates. All forecast data are expressed in constant terms; inflationary effects are discounted. Conversely, all historical data are expressed in current terms; inflationary effects are taken into account.
Disclaimer Much of the information in this briefing is of a statistical nature and, while every attempt has been made to ensure accuracy and reliability, Euromonitor International cannot be held responsible for omissions or errors. Figures in tables and analyses are calculated from unrounded data and may not sum. Analyses found in the briefings may not totally reflect the companies’ opinions, reader discretion is advised. Colgate-Palmolive dominates oral care, a position it has achieved through a truly global presence, continuous new product development and strong ties with the dental profession. The company is a much smaller player in deodorants, a category that is dominated by Unilever. In bath and shower, it also faces strong competition from Unilever, as well as strengthening private label. Truly innovative NPD would be required for Colgate-Palmolive to gain share in these highly competitive categories.
Beauty and Personal Care US$382.2 bn
Oral Care US$35.9 bn Deodorants US$18.1 bn Bath and Shower US$33.8 bn Baby Care US$7.6 bn Hair Care US$67.6 bn Men’s Grooming US$29.6 bn
© Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO
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KEY FINDINGS COMPETITIVE POSITIONING MARKET ASSESSMENT CATEGORY AND GEOGRAPHIC OPPORTUNITIES BRAND STRATEGY OPERATIONS RECOMMENDATIONS
5% increase in net sales in 2010. deodorants. with unit volume rising by 3%. oral care World BPC share 2010 3. men’s grooming. Operating profit was negatively impacted by a one-time charge of US$271 million as a result of the transition to hyperinflationary accounting in Venezuela. the company also faces strong competition from Unilever.7% Value growth 2010 5. US Global Colgate-Palmolive is the world’s number one oral care company. as well as strong ties with the dental profession.com .KEY FINDINGS Key company facts Colgate-Palmolive Co Headquarters Regional involvement New York. Furthermore. as well as private label. dominating the category with a near 26% value share in 2010 – a share that has steadily increased since 2005. The company has achieved this enviable position through a truly global presence.5%.warc.3% © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 4 Downloaded from www. Colgate-Palmolive is a smaller player in deodorants. hair care. More groundbreaking innovation would be required for ColgatePalmolive to gain share in these highly competitive categories. bath and shower. partially offset by a negative foreign exchange impact of 1. Baby care. Excluding one-off charges. Colgate-Palmolive reported a 1. 2010 operating profit increased by 5%. Category involvement fragrances. In bath and shower. the company increased its adspend by 8% in 2010. a category that is dominated by Unilever.
Oral care dominance Colgate-Palmolive dominates oral care.e. where its global share largely stagnated.warc. development. personal care a priority Colgate faces strong area for many retailers. with developed markets by per capita consumption attracting new still far below developed consumers through markets. a position that can be attributed to its truly global presence. Bath and shower The company has also recorded a comparatively weak performance in bath and shower. high consumer brand loyalty and strong ties with the dental profession across the world. OPPORTUNITIES THREATS Emerging markets Secondary oral care Procter & Gamble Private label Emerging markets offer There is still plenty of significant long-term potential to increase growth opportunities for usage of secondary oral Colgate-Palmolive’s key care products such as products of toothpaste dental floss even in and toothbrushes. © Euromonitor International With Procter & Gamble The threat from private looking to expand label is also increasing. globally in more with beauty and prospective markets. toothpaste and toothbrushes proved to be relatively recessionresilient. while Unilever – and private label – steamed ahead.Colgate-Palmolive Co STRENGTHS WEAKNESSES Recession-resilient Basic oral care products i.com . which to some extent insulates ColgatePalmolive from economic conditions. educational campaigns. a category in which it lost share throughout the review period to more innovative competitors. Deodorants Colgate-Palmolive is in a weaker competitive position in deodorants.KEY FINDINGS SWOT . PASSPORT 5 BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO Downloaded from www. competitive challenges Private label competition and needs to continue is particularly intense in investing in product bath and shower. most notably Unilever.
This approach is necessary as consumers are increasingly demanding more than basic functions from their oral care products. In 2010. The company also tailors its advertising to highlight the approval of its products by dentists.warc. where per capita consumption of basic oral care products such as toothpaste and toothbrushes is still far below developed markets. © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 6 Downloaded from www. has made Colgate the most recommended sensitive brand in Brazil in 2010. according to the company. This approach also helps increase the success rate of new products. Colgate-Palmolive has expanded focus to premium variants with a stronger ‘medical’ image such as the new ProClinical line (launched in 2010). Strong ties with dental profession Strong relationships with dentists form an integral part of Colgate-Palmolive’s strategy to gain share in developed as well as to penetrate emerging markets. Digital media also play an increasingly important role. which. Advertising The company has stepped up advertising in its efforts to gain market share. up to 15% of the company’s media spending is on digital initiatives. Premiumisation Already with an established reputation for mainstream products. an approach that also helps establish potentially lifelong brand loyalty. such as Colgate Sensitive Pro-Relief. Another focus area is gum sensitivity. its adspend increased by 8% to reach nearly US$1. displacing long-standing number one Sensodyne. In some markets. to raise awareness of dental hygiene at an early age.7 billion.com . A particular focus is on children. with products such as Colgate Sensitive Pro-Relief toothpaste. Advertising includes traditional media advertising as well as in-store advertising to support new products and encourage trial purchases.KEY FINDINGS Key strategic challenges and objectives Education Education campaigns are a key part of ColgatePalmolive’s growth strategy in emerging markets.
KEY FINDINGS COMPETITIVE POSITIONING MARKET ASSESSMENT CATEGORY AND GEOGRAPHIC OPPORTUNITIES BRAND STRATEGY OPERATIONS RECOMMENDATIONS .
com .warc. exceeding global market growth by over one percentage point. Colgate-Palmolive is not immune to the recession. PASSPORT 8 Downloaded from www. posting sales declines in Western Europe and weak growth in North America. BPC market growth accelerates as a result of the recovery of categories such as fragrances and premium cosmetics.COMPETITIVE POSITIONING Above-market performance for most of review period While company growth is largely in line with the global BPC market over 2006-2007. this is more than offset by continued strong emerging market growth. However. registering its worst performance over the review period. © Euromonitor International Colgate-Palmolive’s growth accelerates further in 2009 – while the global BPC market is hit by the economic downturn. BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO Company and BPC market growth return to pre-recession levels. Colgate-Palmolive powers ahead in 2008. A slowdown in growth in Brazil and sales declines in North America meanwhile drag down Colgate-Palmolive’s global growth. specifically in Brazil. A strong performance in BRIC markets (as well as Mexico) helps offset weakness in North America and Western Europe.
6 2. typically with fashion-led marketing or the promise of functionality. with the top three accounting for nearly 30% of the global market. a focus on more natural ingredients and premiumisation where possible.1 2006 2007 2008 2009 2010 Uniformity of strategy characterises competition The global market for beauty and personal care was fairly static at the top in recent years.COMPETITIVE POSITIONING Market stability underpinned by scale of players BPC: Top 10 Global Companies by Value. PASSPORT 9 Company Procter & Gamble Co. in particular China. Market stability was helped by the unusually high value shares of the leading players. The L’Oréal Groupe Unilever Group Colgate-Palmolive Co Avon Products Inc Beiersdorf AG Estée Lauder Cos Inc Johnson & Johnson Inc Shiseido Co Ltd Kao Corp 5-year trend 1 2 3 4 6 7 5 9 8 1 2 3 4 6 7 5 8 9 1 2 3 4 5 7 6 8 9 1 2 3 4 5 6 7 8 9 1 2 3 4 5 6 7 8 9 10 10 10 10 10 © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO Downloaded from www. and have all followed basically the same development strategies. This has meant pushing into emerging markets.9 3. and the scale of these shares limits erratic movement.6 9.8 2. The leading companies are primarily global rather than local brand operators.2 2. 2006-2010 2010 % share 11. Colgate-Palmolive is in line with this through its strategy to further penetrate emerging markets through education campaigns aimed at increasing usage.com .warc. as well as its focus on premium oral care to encourage trading up in developed markets.7 3.9 2.4 3.8 6.
Moreover. which they were largely able to retain also during the economic downturn (aided by price promotional campaigns). © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 10 Downloaded from www.COMPETITIVE POSITIONING Oral care a consolidated category Oral care is highly consolidated. As such.warc. Procter & Gamble. compared to 16% for Procter & Gamble and 9% for Unilever. Colgate-Palmolive is by far the most focused on oral care. Private label is present but remains low in importance. with smaller companies (listed as “Others” in the charts below) not able to compete against them in terms of marketing and product innovation. which accounts for 65% of its total BPC retail sales. Most of the share lost by smaller companies over the review period has been claimed by leading player Colgate-Palmolive. with the top four players (Colgate-Palmolive. Colgate-Palmolive ploughs considerable resources into marketing and product innovation into this category. as branded products enjoy high consumer trust and loyalty.com . GlaxoSmithKline and Unilever) accounting for nearly 62% of total category value sales in 2010. Of the top players. which gained a further three percentage points in share over 2005-2010. their share has steadily increased since 2005.
) as of 2010. © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 11 Downloaded from www. notably the key US market.com . however. mostly developing markets such as Indonesia and Vietnam. this includes key country Germany. Unilever leads in 12 countries.COMPETITIVE POSITIONING Colgate-Palmolive: Oral care leadership in majority of countries Notes: Colgate-Palmolive is the number one oral care company in 45 countries (of 80 countries researched by Euromonitor Int. GlaxoSmithKline has limited leadership. leading all regions but North America. Procter & Gamble has leadership in 11 countries.warc.
KEY FINDINGS COMPETITIVE POSITIONING MARKET ASSESSMENT CATEGORY AND GEOGRAPHIC OPPORTUNITIES BRAND STRATEGY OPERATIONS RECOMMENDATIONS .
range displayed: 0. in particular in Brazil. Colgate-Palmolive is highly exposed to one of the most mature categories. i.com . pet nutrition and home care. Oral care accounted for 65% of its total BPC retail sales in 2010.e. personal care and. On the other hand. which is set to record below BPC-average growth over 2010-2015.MARKET ASSESSMENT Cross-category presence but oral care key Category focus is an integral part of Colgate-Palmolive’s growth strategy. As such. which is expected to account for 42% of global category growth – an opportunity Colgate-Palmolive should look to capitalise on.7% © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 13 Downloaded from www. hair care and deodorants. Moreover. Bubble size shows company share of category in 2010. oral care. with the company intent on remaining “sharply focused on existing categories”. growth opportunities continue to be presented in both developed and emerging markets. especially for basic products such as toothpaste and toothbrushes (Colgate-Palmolive’s key areas). it is also one of the most recession-resilient categories. beyond beauty and personal care.1-25.warc. Deodorants offers good growth opportunities. Its other main BPC categories in terms of retail sales are bath and shower.
and significant growth opportunities exist by increasing usage of oral care among the (still large) low-income group. This is testament to the rising purchasing power across emerging markets where the middle class is rapidly expanding. Nevertheless. as well as encouraging those consumers with higher disposable incomes to trade up to more premium oral care products such as Colgate Sensitive Pro-Relief. rather than more basic oral care products. with a presence in over 200 countries across all world regions. Asia Pacific.com . Latin America. although unsurprisingly.MARKET ASSESSMENT Emerging markets will drive beauty and personal care growth Colgate-Palmolive is a truly global company. Eastern Europe and Middle East and Africa will record the most dynamic growth over 2010-2015. beauty and personal care growth will to a significant extent be driven by higher-value products such as fragrances and skin care.4% © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 14 Downloaded from www. across these emerging regions. range displayed: 2.3-7.e. Middle East and Africa Latin America Eastern Europe Asia Pacific Australasia North America Western Europe Bubble size shows company share of region in 2010.warc. less mature regions i. All regions continue to offer growth opportunities for beauty and personal care. However. oral care is also expected to record positive value growth across these markets.
KEY FINDINGS COMPETITIVE POSITIONING MARKET ASSESSMENT CATEGORY AND GEOGRAPHIC OPPORTUNITIES BRAND STRATEGY OPERATIONS RECOMMENDATIONS .
Products targeted at children are likely to increase further in popularity. and tooth whitening in others. consumers will be more discerning about the results provided by the oral care products they purchase. toothbrushes and toothpaste designed for travel purposes in small sizes are also likely to grow in demand. especially in developed markets. Whitening toothpaste will do well in various countries. Price will be a major factor in consumer choice between these products. This will boost sales of various oral care products. The use of herbal ingredients will therefore become more prevalent for toothpaste. Even for whitening purposes. Segmentation Targeting specific consumer groups will support category growth. such as sage in Italy. The children’s segment is still not yet fully tapped with the majority of toothbrushes and toothpaste still universal products.CATEGORY AND GEOGRAPHIC OPPORTUNITIES Efficacy and segmentation key in oral care Efficacy With stronger awareness of dental hygiene. such as in China with lotus leaves. Growth for power toothbrushes will benefit from perceived efficacy compared to manual toothbrushes.warc.com . and more consumers will upgrade their toothbrushes as income levels rise. With increased mobility and travel. there will be more interest in natural ingredients. © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 16 Downloaded from www. Vanity The view will continue to shift on oral care products beyond simply offering a health function to also enhancing attractiveness. Natural and organic Herbal and natural products will gain more attention as consumers become more health conscious and view these products to be healthier. Whitening products on the whole are set to benefit from the vanity trend.
however. by encouraging more frequent replacement purchases for toothbrushes as well as the trading up to more premium products.7-35. especially in developing countries.CATEGORY AND GEOGRAPHIC OPPORTUNITIES Basic and secondary oral care offer growth opportunities Basic products.e. Basic oral care products are already mature. Dental floss Tooth whiteners Mouth fresheners Mouthwashes/dental rinses Toothbrushes Toothpaste Bubble size shows company share of category in 2010. growth still comes from increasing frequency of usage. the UK) usage of dental floss remains below the US and there is therefore significant potential if usage can be increased by positioning these products as essential to dental hygiene. in developing but also in many developed markets. even when it comes to basic oral care products. in many Western European markets (e.g.g.g. account for nearly 80% of total category sales. For instance. private label had a marginal share of much less than 1% of toothpaste. as many products are still not used regularly and overall penetration is still low. largely unchanged since 2005) and as such.2% © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 17 Downloaded from www. in North America. the threat from private label is less severe than in other categories such as bath and shower. e. i. toothpaste and toothbrushes. most consumers remain loyal to brands (e.com . range displayed: 0. Growth for such products is also still achievable in highly developed markets. Secondary oral care products also hold further growth potential.warc. Moreover.
While it also leads in Asia Pacific. growth will be very modest. the gap to second-ranking Procter & Gamble is less wide there. Middle East and Africa has very strong long-term potential. and growth potential would be even greater for Colgate-Palmolive if it could increase its share. emerging market regions have the best growth potential.com . the market size could be massively increased. are the more attractive regions in terms of overall growth potential. Latin America and Asia Pacific. however. however.5% © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 18 Downloaded from www.warc. If Colgate-Palmolive is successful in its endeavours to increase usage of oral care products through educational campaigns. range displayed: 16. oral care continues to offer growth opportunities across all world regions – although in some. driven by premium product innovation. as the dominant player with a near 50% value share. As with beauty and personal care overall. Colgate-Palmolive is particularly well positioned in Latin America. most notably Australasia.9-49. with the two regions combined predicted to account for 66% of global category growth over 20102015. even in developed markets such as Western Europe. value growth is still to be found.CATEGORY AND GEOGRAPHIC OPPORTUNITIES Oral care expected to continue to grow across all world regions Despite its maturity. Middle East and Africa Latin America Asia Pacific Eastern Europe Western Europe Australasia Bubble size shows company share of region in 2010.
2010/2015 absolute retail growth – US$ mn fixed ex rate © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 19 Downloaded from www.com .warc.CATEGORY AND GEOGRAPHIC OPPORTUNITIES Brazil and China to lead global oral care growth +US$723 mn +US$680 mn > US$300 mn US$200-300 mn US$100-199 mn US$50-99 mn US$0-49 mn Negative growth Figures: Oral care.
The company sees huge further growth potential in these markets by not just tapping into the growing middleclass segment.warc.2 18.CATEGORY AND GEOGRAPHIC OPPORTUNITIES Long-term growth potential in developing markets Considering the still much lower per capita consumption and spend on basic oral care products in developing markets compared to developed markets.com .874.789. which allows it to capitalise on middle-class growth.9 2.5 602.5 Average per day 91. Combined with the large population in developing markets. compared to US$8 in developed markets. average disposable income per capita is less than US$2 per day).1 6. as well as being able to reach the lowest earners. Colgate-Palmolive is highly active in emerging markets.g. but also making oral care products accessible to the vast low-income group (e.1 5.6 16.1 1. Colgate-Palmolive follows a tiered product strategy with products at all price points. Per Capita Disposable Income Comparison 2010 (US$) Country US Brazil Russia China India Kenya Per capita annual disposable income 33. where it has a long-standing presence.6 6. long-term growth potential in developing markets is massive.5 3. by offering toothpaste in smaller pack sizes. Per capita spend on toothpaste in all developing markets combined stood at just US$1. for instance.7 © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 20 Downloaded from www.903. even a small increase in average per capita consumption rates would have a significant impact on total sales.129. in Kenya.9 1.7 in 2010.377.
offer a significant growth opportunity. keeping these products affordable for the low-income segment is essential.CATEGORY AND GEOGRAPHIC OPPORTUNITIES Emerging markets – success factors Accessibility A large segment of the emerging market population are in the low-income band and are unable to afford foreign products. in Malawi. such as propolis in Russia or tea flavour in China. BPC players including Colgate-Palmolive are making their products accessible through micro selling. but to tap into this growth. and products need to be tailored to cultural preferences to strike a chord with consumers. Local product adaptation is also important to attract consumers. by offering different toothpaste flavours. Colgate-Palmolive partnered with the Ministry of Health during Oral Health Month to help educate children and adults about good oral care habits.warc. and to raise overall awareness of dental hygiene. Penetrating non-urban markets Non-urban regions lack modern retail infrastructure and consumers tend to rely on kiosks for a variety of their daily needs. The shopkeepers tend to share a close relationship with their customers and hence are in a position to motivate purchases. i. small pack sizes such as sachets.e. beauty products. but also to train shopkeepers on the benefits of the products. For instance. In order to develop greater market penetration. Education campaigns Health and hygiene education campaigns are also key to change emerging market consumers’ beauty and hygiene routines and switch from indigenous products to Western brands.for instance. © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 21 Downloaded from www. Colgate-Palmolive tailors its oral care products to local consumer preferences . Addressing cultural preferences Making products accessible to consumers is not a guarantee for their success.com . due to their huge numbers. These consumers. including soap. it is not only necessary for the brands to be present in these types of outlets. detergents and food.
making them more accessible to consumers used to indigenous hygiene practices. rural consumers in India use neem sticks to “brush” their teeth rather than toothbrushes and toothpaste. For example. All key players are aware that consumer behaviour differs from market to market.warc. and strategic.com . To increase availability. © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 22 Downloaded from www. making consumers aware of the product benefits and clearly visible displays drove sales growth. This was supported by a media campaign on the health benefits of its products. The combined effort of training shop owners.CATEGORY AND GEOGRAPHIC OPPORTUNITIES Connecting with emerging market consumers As part of their marketing strategies. within three months its sales of toothbrushes in Colombia doubled. Colgate-Palmolive in Colombia trained shop owners on the benefits of Colgate Fresh Twister manual toothbrush. companies are focusing on developing closer ties with small shop owners. Oral care companies can initiate campaigns on the benefits of using toothpaste and toothbrushes and offer smaller pack sizes for these products with basic features at lower price points. visible in-store displays were erected. According to the company.
Other important growth markets include India and Germany. which are claimed to control stress-induced sweat.CATEGORY AND GEOGRAPHIC OPPORTUNITIES Colgate-Palmolive a smaller player in deodorants Compared to oral care. Moreover. © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 23 Downloaded from www. truly breakthrough innovation will be key. Nevertheless. ColgatePalmolive considers deodorants to be a key category that forms an integral part of its growth strategy. similarly to Beiersdorf’s launch of deodorants under the Nivea brand (2010). which is predicted to account for 42% of global growth. Colgate-Palmolive is a much smaller player in deodorants. and where Unilever has also established itself as the dominant force. however. Colgate-Palmolive faces very strong competition from dominant player Unilever. Unilever managed to further extend its lead over its rivals over the review period. By far the most attractive growth market over 2010-2015 is expected to be Brazil. Innovation such as Speed Stick Waterproof may enable the company to claim a larger share of this attractive growth market.com . markets in which Colgate-Palmolive has no presence in the category. a category that is dominated by Unilever. To claim a larger share of deodorants. while Colgate-Palmolive’s share fell by nearly one percentage point.warc. it has made small inroads with its Speed Stick brand.
Private label bath and shower benefited from the economic downturn and consumer down-trading. An important competitor in the category is furthermore private label. which reached a global share of almost 6% in 2010 (and nearly 15% in Western Europe). Penetrating the Chinese market and further strengthening its presence across these other key emerging markets could prove worthwhile. they are expected to account for around 60% of global category growth over 2010-2015. Global bath and shower growth will be driven by the BRIC markets – combined.com . © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 24 Downloaded from www. as well as the introduction of new products such as its Mediterranean-inspired Palmolive Authentics liquid hand soaps.CATEGORY AND GEOGRAPHIC OPPORTUNITIES BRIC markets key to bath and shower growth Bath and shower is a category that received significant attention from Colgate-Palmolive in 2010 with product relaunches (Palmolive Naturals. As in deodorants. Unilever managed to increase its global share of the category over the review period. Colgate-Palmolive faces strong competition from leading player Unilever.warc. while Colgate-Palmolive’s share stagnated. The company has established a presence in the category across these markets except for China. Palmolive Aroma Therapy and Thermal Spa). Similarly to deodorants.
but is strongest in deodorants and bath and shower.CATEGORY AND GEOGRAPHIC OPPORTUNITIES Sanex acquisition will improve competitive position in Europe Colgate-Palmolive has purchased the Sanex personal care business. equating to a 3% rise. The Sanex brand spans several categories. the company should also consider extending the brand into more prospective regional markets. Beiersdorf and L'Oréal. sales of which are concentrated in Western Europe. Adding Sanex to its portfolio will help Colgate-Palmolive to increase its revenue by approximately US$450 million. which accounted for 91% of the brand’s total retail sales in 2010. as well as investing in product development to keep up with competitors such as Unilever. Spain and the UK. from Unilever. as well as in a number of smaller markets (Belgium.warc. such as in dynamic Latin America. While the acquisition will improve ColgatePalmolive’s competitive position in Europe.com . © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 25 Downloaded from www. Denmark and the Netherlands). with the company’s sales receiving a particular boost in France.
Men’s grooming Deodorants Bath and shower Baby care Oral care Hair care Bubble size shows company share of category in 2010. Deodorants and men’s grooming are other attractive growth categories in which Colgate-Palmolive still needs to establish a stronger presence. although oral care continues to account for the vast majority of its total retail sales (65%). gaining a greater share of these categories will be a challenge as they are both dominated by strong players.CATEGORY AND GEOGRAPHIC OPPORTUNITIES Brazil one of the most attractive BPC growth markets Brazil is one of the most attractive growth markets for beauty and personal care. which it dominates with a 46% value share in 2010. i. Colgate-Palmolive is in a particular position of strength in oral care. Colgate-Palmolive has established a presence in this market across a large number of categories.warc. with significant growth opportunities offered across the BPC market. significantly ahead of second-ranked Procter & Gamble. Indeed. range displayed: 0.5-45. and will thus require significant investment in terms of product innovation and marketing.e.9% © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 26 Downloaded from www. As such.com . However. Procter & Gamble (men’s grooming) and Unilever (deodorants). it will be the main beneficiary (and indeed a key driver) of the predicted US$680 million increase in category sales over 2010-2015. in order to be able to fully capitalise on the growth opportunities offered.
In contrast to other BRIC markets.CATEGORY AND GEOGRAPHIC OPPORTUNITIES Widening gap to oral care rivals should be a priority in China China is another highly attractive growth market for beauty and personal care. © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 27 Downloaded from www.com . it does not dominate oral care to the same extent. Growth in oral care will be supported by an increasing number of consumers upgrading within basic oral care products and increasingly incorporating secondary oral care products such as mouthwashes/dental rinses into their dental hygiene routines. whitening oral care products are also set to perform strongly in China. As consumers increasingly perceive oral care in terms of achieving greater attractiveness over hygienic function. offering significant opportunities across BPC categories. In order to defend its position. if Colgate-Palmolive has any ambition to claim the kind of oral care dominance in this market that is has achieved in Brazil and India. a trend which Colgate-Palmolive can tap into with products such as Plax Whitening.warc. while Colgate-Palmolive leads category sales. having a strong competitor in Procter & Gamble. Vanity will also be a driving factor for oral care in China. continued investment in the category is thus essential – and potentially more important for the time being than trying to diversify into other BPC categories.
Moreover. while in rural areas. Colgate-Palmolive has established a presence in bath and shower as well as men’s grooming. Indeed.warc. Colgate-Palmolive’s strategy in India is reportedly to focus more strongly on oral care. Men’s grooming would be a more attractive growth category. where it dominates with a value share of nearly 47% in 2010. apart from its key oral care category which accounted for 98% of its total retail sales in 2010. but Colgate-Palmolive’s share and ranking slipped greatly over the review period and the category thus was clearly not a focus area for the company.CATEGORY AND GEOGRAPHIC OPPORTUNITIES Focus is on oral care in India In India. Colgate-Palmolive is only a small player in bath and shower and further category penetration would require significant marketing investment – an endeavour which may not be worthwhile. focus will be on introducing consumers to the concept of brushing their teeth regularly through trialgenerating small SKUs and awareness-building school programmes. © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 28 Downloaded from www.com . While bath and shower is by far the largest BPC category. growth is predicted to be comparatively moderate over 2010-2015. The company aims to increase the frequency of usage for its oral care products in urban areas through campaigns such as “Brush twice a day”.
there is flexibility in terms of adapting core brands to suit local trends. While Colgate-Palmolive operates a number of secondary regional and local brands.Colgate and Palmolive. over the review period.BRAND STRATEGY Colgate-Palmolive banks on blockbuster brands Colgate-Palmolive has a relatively narrow portfolio of mass-market beauty and personal care brands and its operations in this market are based strongly on its two flagship labels . a comparatively high figure. Indeed. That said. recorded sales declines over the review period. To drive up efficiency. Colgate-Palmolive aimed to simplify its product portfolio by reducing the number of SKUs by nearly one quarter. in 2010 ColgatePalmolive discontinued the brand in certain oral care categories (dental floss and mouthwashes/dental rinses) to focus on its flagship Colgate brand instead. © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 30 Downloaded from www. In particular the Sorriso oral care brand.warc.com . only present in Brazil. Further streamlining of the company’s brand portfolio would be possible. it has been focusing on its flagship labels and looking to establish their global credentials. These eponymous brands account for over 50% of its total BPC retail sales. such as Softsoap (North America and Australasia).
Also in 2010 Colgate-Palmolive launched a new premium toothpaste range.com . marketing and education campaigns. a position previously occupied by rival Sensodyne. The brand enjoys strong loyalty among consumers. Key variants of the Colgate brand include Colgate Total. according to the company. The launch seems poised to capitalise on the trend for cash-strapped consumers to cut back on visits to professionals (including dentists) where possible and increasingly focus on at-home treatments instead. marketed as offering professional oral care at mass prices. the brand is top-of-mind for toothpaste. which offers enhanced total protection.BRAND STRATEGY Colgate widens gap to oral care rival brands With an almost 21% value share in 2010. Colgate ProClinical. The line comprises three products. as well as by further strengthening its relationship with dental professionals. Daily Cleaning and Daily Enamel Renewal. in many countries. which enabled the company to more effectively compete in the important sensitivity segment. and was able to further increase its share of global oral care over the review period. which addresses specific dental problems. as a result of the launch. Daily Whitening. The launch has been highly successful – in Brazil. and Colgate Plax. the company relaunched its Colgate Total brand with a new formula and sensitivity benefits. Colgate became the most recommended sensitive brand in 2010. Colgate is the world’s leading oral care brand. supported by product innovation. © Euromonitor International In 2010.warc. Indeed. A major new product launch over the review period was that of Colgate Sensitive Pro-Relief toothpaste in 2009. PASSPORT 31 BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO Downloaded from www. for instance.
Like Colgate. BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 32 Downloaded from www. especially from the large number of smaller brands.warc. in particular in developed markets where private label products became highly sophisticated and where private label became an attractive alternative to consumers during the economic downturn.2 percentage points below that achieved in 2005. © Euromonitor International Private label will be the strongest threat. as well as launching a new line of liquid hand soaps with Mediterranean-inspired scents. Palmolive registered no share gains over the review period – indeed. the strength of private label bath and shower could even further increase over the forecast period. there are several variants under the Palmolive umbrella. in 2010 Colgate-Palmolive relaunched its key Palmolive Naturals and Aromatherapy and Thermal Spa brands. To boost growth. while all major rivals managed to increase their shares. In contrast to the Colgate oral care brand.BRAND STRATEGY Weaker performance by Palmolive Palmolive is Colgate-Palmolive’s other flagship brand and the world’s number three bath and shower label. especially considering that bath and shower is overall a still more fragmented category compared to oral care and significant share gains can thus still be achieved. With private label beauty and personal care high on retailers’ agendas. in 2010 its share of bath and shower was 0. It is also active in deodorants. men’s grooming and skin care. Further growth is achievable. including Palmolive Naturals and Palmolive Aromatherapy and Thermal Spa. Truly innovative product launches and establishing an emotional bond with consumers will be vital for brands including Palmolive to keep private label at bay. hair care.com .
Colombia. in particular in China. South Africa. Italy. personal and home care production facilities are located in Australia. Colgate-Palmolive rationalised its production base. Most recently. accounts for more than 10% of Colgate-Palmolive’s trade. Colgate-Palmolive enjoys strong links with dental professionals and as a result. allowing it to tailor innovation to local needs and demands. Italy and Turkey to a new facility in Poland. These smaller retail outlets form a major part of the distribution landscape in large. In Brazil. personal and home care research centre is situated in Piscataway. China. convenience stores and chemists/drugstores are all key retail outlets. The company also has technology and category innovation centres in Latin America. personal and home care plants in Morristown. fragmented markets such as China. the company has separated its manufacturing facilities from its distribution infrastructure as part of an efficiency-led development programme. Key overseas oral. including oral. Thailand and Venezuela. Mexico. it has consolidated its European toothpaste production base. Ohio. Supermarkets/hypermarkets. Poland. the company has been investing in its presence in small shops in emerging markets. Most recently. Colgate-Palmolive’s oral. New Jersey. and Cambridge. No one client. giving its brands invaluable equity among consumers. France. Europe and Asia. As part of its 2004-2008 restructuring programme. New Jersey.com .warc. including in the important BRIC markets.OPERATIONS Colgate-Palmolive owns broad operation base Vast distribution network Colgate-Palmolive retails its beauty and personal care products via a vast distribution network. PASSPORT 34 © Euromonitor International BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO Downloaded from www. Brazil. Morristown. such as Wal-Mart. which includes the normal array of channels. its products are widely placed in dental practices. Tennessee. Romania. Production base consolidation Colgate-Palmolive has a major production base in the US. transferring activity from plants in the UK.
RECOMMENDATIONS Key recommendations Shore up innovation in deodorants Colgate-Palmolive will need to launch truly innovative products to be able to effectively compete in deodorants. for instance. Colgate will need to develop equally innovative technology to truly be able to compete. per capita consumption of dental floss remains below the US. Advertising messages centred on the concepts of luxury/at-home pampering.com . Reinforce emotional bond in bath and shower In bath and shower. Beiersdorf. is less dominant in China compared to other emerging markets and the company should look to further strengthen its competitive position to be able to fully capitalise on the long-term growth opportunities in this market. marketed as increasing the level of protection with increasing physical activity. a category where competition is strengthening from private label. while the leading oral care player. for instance. In many Western European countries. naturalness or sustainability strike a chord with many consumers and should help keep the private label threat at bay.warc. Further local adaptation in China necessary Colgate-Palmolive. This would also help defend its share against local players such as Yunnan Baiyao. Further adapting products to more closely meet local consumer preferences may be beneficial. developed a deodorant specifically for teenagers that is marketed as controlling stress-induced sweat. by incorporating TCM in product formulas. for instance. © Euromonitor International Further educate developed market consumers Even in mature. advertising and marketing campaigns that strengthen the emotional bond between the Palmolive brand and consumers will be crucial for the company to retain and further grow its market share. BEAUTY AND PERSONAL CARE: COLGATE-PALMOLIVE CO PASSPORT 36 Downloaded from www. developed markets significant further growth potential exists by increasing penetration of secondary oral care products. Education campaigns highlighting that products such as dental floss are essential for optimum dental health (as well as helping reduce the need for dental treatments) would help raise awareness and thus uptake. Unilever developed a “motion sense” technology.
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