Colgate Max Fresh Global Brand

Roll Out
China - Mexico

Introduction..

Colgate Palmolive Company..

Products Manufactured..
Oral care and personal care (soaps, toothpaste,
toothbrushes, speed sticks)
Veterinary products, under Hills brand

Timeline
In 1806, William Colgate started a starch, soap and
candle factory named William Colgate & Company
In 1840, the company started selling individual soaps
having uniform weights.
In 1857, William died and the company was renamed to
Colgate & Company

Timeline..
In 1872, Cashmere Bouquet (a perfumed soap) was
launched

In 1873, the company started selling toothpastes in jars

Timeline..
In 1896, Colgate Ribbon Dental Cream was launched

In 1908, the mass selling of the toothpaste started

B.J Johnson Company..

Change in the Therapeutic Segment..

In 1950, Crests field research on fluoride toothpaste
found a 50% reduction in cavities
In 1955, Crest launched a Fluoride-toothpaste
The patent restricted other companies to launch
fluoride-based toothpastes.

CP - focus on International Business and

other segments..
Colgate Company has been present in Singapore since
1920
Cold Power laundry detergent was sold in the U.S in
1960s and early 70s.
Elmex is a medical toothpaste sold since 1962
Fresh Start was a detergent launched in 1970.

Colgate - Palmolives focus on

International Business and on other
segments

Irish Spring, a deodorant soap was launched in 1972

Hills Pet Nutrition was acquired by C-P in 1976
Softsoap, a Minnesota based company was bought in
1987
Mennen was a leader in leader among deodorants and
antiperspirants for men. It was sold to Colgate-Palmolive in
1992

CP - focus on International Business and

on other segments..
Colgate bought Cibaca in 1994, which is an oral
hygiene brand in India. It is more popular in rural India
In 2006, 84% stake of Toms of Maine were bought by
Colgate-Palmolive. Toms of Maine manufactures natural
ingredients for personal care products

Return to the Therapeutic Segment..

In 1997, Colgate came out with a premium product
named Colgate Total, that promised 12 hour protection
against gum diseases, gingivitis and plaque.
Colgate-Palmolives Global Market Share remained
almost constant for 5 years, upsetting Crests
dominance in therapeutic segment.
2000

2001

2002

2003

2004

ColgatePalmolive

39.7%

40.6%

39.8%

38.8%

39.7%

Procter &
Gamble

12.2%

12.5%

13.8%

13.9%

14.7%

Cosmetic Segment Product..

In 2002, R&D and CIC (Customer Innovation Centers)
worked on a new toothpaste formula. As a point of
differentiation, Mini Breath Strips were added to the
toothpaste. This promised fresh breath to the
consumers.

Strengths
Global Brand Recognition. (World first
toothpaste).
A leading market share of 39.7%, compared
to Crest, which is the 2nd leading market
leader with 14.7%.
The Organizational Structure set up results
in effective local management.
CP put together Consumer Innovation
Centers (CICs) to develop short-term
innovations for each region.
Global business development groups.
Categorical leadership in China and Mexico
Opportunity
making them leaders in the emerging markets
hence
The Chinese
market
is not familiar with the
flexibility
.
freshness concept. This is an opportunity for
Colgate to establish presence within this
particular niche.
With the introduction of the CMF, Colgate will
tap into a market with a population of 1.35
billion.
Emerging markets are not familiar with the
cosmetic benefits of toothpastes, and this is an
opportunity for CP to convert customers who
value therapeutic benefits to cosmetic benefits.

Weakness
Organizational Structure - all responsibility, no
accountability system Hinder Growth.
Research and development is too focused on
data that is not only costly, but also time
consuming.
Global platform is a weakness in itself as CP
needs to localize their marketing efforts and
present a marketing plan that is suited for the
particular market.
communication challenges proved to be a
problem for CP as they are forced to rebrand
their product to suit the
different markets.

Threats

The greatest threat for CP is Crest, and it is

shown that Crest has been gaining market share
through the cosmetic segment.
CPs high market share creates an avenue for
competition given the relatively low barrier of
entry.
Cannibalization (Marketing Dollars)

MEXICO
Mexico Toothpaste Market
$348 million retail toothpaste market in 2004.
Colgate owned 82% value share.
Crest owned 10% market share.
Flat toothpaste demand > Difficulty in securing incremental shelf space.
Majority of consumers focused on basic oral care (cavity prevention)
Price sensitivity and sale promotion activity were high.

Colgate Max Fresh Launch Strategies

- Mexico
A test Plan was executed to:
Assess consumer appeal pre and post product use
Expected Sale volume
Sources of Volume
Optimal Pricing
Net acceptance was slightly below par in terms of benchmarks for comparable new personal care
products tested in Mexico.
Consumer Viability Index of 62% suggested that the initiative had an average chance of in
market success, defined as maintaining stable distribution for at least two years after launch.

Colgate Max Fresh Launch Strategies

- Mexico
(Total Consumers)

A test Plan was executed to:

Assess consumer appeal -before and

post product use.

Expected Sale volume

Sources of Volume

Optimal Pricing
Net acceptance was slightly below par in
terms of benchmarks for comparable new
personal care products tested in Mexico.
Consumer Viability Index of 62% suggested
that the initiative had an average chance
of in market success, defined as maintaining
stable distribution for at least two years
after launch.

Max Fresh
Total
Sample
(282)

BASES
Success
Benchma
rks

Definitely would buy

65

71

Definitely or probably would buy

95

95

Mean Liking Rating (6-point

scale)

4.8

4.9

Mean Value rating (5-point

scale)

4.0

4.0

Better than expected

59

71

Worse than expected

Purchase Intent (%)

Product Expectation (%)

Colgate Max Fresh Launch Strategies

- Mexico
Pricing:
Pricing objective was to achieve parity with Crests Cool explosions.
Price / Value perception was above average for CMF.
Analysis revealed that volume was maximized at 14.50-15.00 pesos.
Tested at a retail price of 15.99 Pesos.
Estimated that CMF could increase volume by +25% if the price was
decreased from 15.99 to 14.99 pesos.
Advertising:
Proposed advertising idea, A joy for your mouth. Depicted in an advertisement entitled Snow
Surfer.
Incremental Production and talent costs combined were $500,000.

Colgate Max Fresh Launch Strategies

- Mexico

https://www.youtube.com/watch?v=05R7tL3zC_I

Brand Recommendation Strategies Mexico

Product:
Three Flavors Clear Mint, Cinnamint and Cool Mint.
Two Packaging formats Bottles and tubes
Two sizes 75ml @ 14.93 Pesos (Limited Distribution)
100ml @ 15.30 Pesos
Media Investments of almost two million dollars in the first eight months after the CMF launch was
expected to delier a 14.7% share of voice.

Colgate Max Fresh Launch Strategies

- Mexico
North
America
President
Profit & Loss
responsibility
Consumer
Innovation
Centers
&
Marketers
insighters &
product
developers

Go to Market
Team

Global Business
Development
Groups
Latin
Europe
America
President
President
Profit &
Profit &
Loss
Loss
responsibil
responsibil
ity
ity
Consumer
Innovation
Centers
&
Marketers
insighters &
product
developers

Consumer
Innovation
Centers
&
Marketers
insighters &
product
developers

Go to Market
Team

Go to Market
Team

Asia / Africa
President
Profit & Loss
responsibility
Consumer
Innovation
Centers
&
Marketers
insighters &
product
developers

Go to Market
Team

Chief
Operating
Officer

Organizational Structure..
Regional presidents with P&L Responsibility.
Global Business Development Groups organized by Category.
Global research works with CICs to develop new products.
Go To Market team initiates the planning and execution of new products.

Restructuring of Colgate..
Rising Raw materials cost and intense competetition from
rivals.
Saved $300 Million a year
Streamlining its global supply chain and thereby,
encouraging growth and expansion.
Company closed one-third of its manufacturing facilities.
Concentrated mainly on Latin America, Russia, China,
Eastern Europe, Asia/Africa

U.S Toothpaste Market..

In the year 2004 U.S the retail toothpaste market value share had appreciated by 8% which was
$2438 Million by four major players who were Colgate, Procter & Gamble, GlaxoSmithKline, Church
and Dwight and other small manufacturers.

Market Value Share in 2004..

Manufacturer

Brand

Value share in 2004

Colgate Palmolive

Colgate

34.8%

Procter and Gamble

Crest

31.6%

GlaxoSmithKline

Aquafresh,Sensodyne

14.5%

Church and Dwight

Close-up,
Mentadent,Aim

10.2%

Other

8.9%

Market Segment..
The toothpaste category is segmented in four pricing
options, super premium($3.49+), Premium(2.49-$2.99),
Mid($1.99-$2.49) and Value (1.99).
Product segments are Oral, Personal and Home care.
Segmented in to Customer need which was cavity and
fluoride protection.