INSTITUTE OF MANAGEMENT STUIES NOIDA

Project Report

A STUDY ON MARKETING STRATEGIES OF COLGATE

PALMOLIVE LTD.

“POST GRADUATE DIPLOMA IN MANAGEMENT” SESSION: 2011-13

SUBMITTED TO SUBMITTED BY DR. VANDANA MATHUR

Contents

Executive summary 1

Introduction 2

Objective 3

Methodology 4

Literature Review 5

Company Profile 6

Company Strategy 6

Marketing Mix 15

SWOT Analysis 26

Survey Findings 28

Retailers Survey 34

Conclusion 37

Suggestions 39

Consumer Questionnaire

Retailer Questionnaire

Bibliography

EXECUTIVE SUMMARY

The project was started on 1st December, 2012 after knowing all the relevant information about the Colgate market and distribution, under the guidance of ……………. The first part of my project involves the study of distributors allocated to me Identification of their problem areas and helping them in order to increase sale. For this I used the method of personal interviews and questionnaires. At the same time, they were being made aware of the increasing network and consumption of toothbrush customers. For this I visited around 20 distributors in New Delhi region. I was also visited 20 retailers s out of New Delhi.

This study deals with the marketing activities for the LPG, study the customer satisfaction level.The customer satisfaction level is being measured through a questionnaire and covers the important measuring coordinates of the satisfaction level. The results from the survey are analyzed and several interesting revelations are made in the end with suggestions to improve the image and sales of the product.

INTRODUCTION

As early as 3000 B.C. Egyptians used toothbrushes fashioned from twigs. In the 20th century a

major design advance occurred in 1938 with the launch of Dr. West’s Miracle Tuft toothbrush,

the first nylon bristle brush. Until the late 1970’s toothbrushes were widely viewed by consumer

as a commodity and were primarily purchases on price. The involvement remained low and the

companies also treated their toothbrushes as an extension, to get their consumers to use their

toothpastes. Typically in the Indian market the percentage of toothbrush users has slowly inched

upwards. As it has always been associated by the non-users as a non-essential item more so

because of their fierce loyalty to the margosa twigg(Datun) and the index finger. The market of

late has been the entry of several foreign players and the marketing game has assumed a totally

new dimension. Companies are trying to shift to “PULL” strategy of long term returns and the

inclination of consumers to shell out a few rupees extra to ensure a more wholesome care of their

teeth and gum. This has resulted in rapid growth in value terms. Added to this is the initiative of

the companies to focus on expanding the market by bringing the over 65% non-users in their

consumer fold. With such vast potential to be exploited, the entry of several new players with

their innovative ideas and experience in similar developing markets, the industry is likely to see a

lot of action in the immediate future.

OBJECTIVE

The above of the project was manifold.

First of all a general idea of the toothbrush industry - its competitiveness, volume and

potential was to be adjudged.

Next was to go on to analysis of the attitudes of a typical consumer and his/her

idea/perception of this low involvement category product.

This was to be followed up with the study of Colgate Plus toothbrush, as a typical product of

the company, Colgate Palmolive and its standing in the market vis-à-vis other players,

especially new entrants.

To amalgamate all above to conclude as to what was to be the future/probable course of the

toothbrush industry and Colgate Plus tooth brush in particular.

METHODOLOGY

1. To get an idea of the industry, I went through all the relevant literature we could lay my

hands upon. This included A & M’s, Business Today’s.

2. For consumer attitudes, I prepared a questionnaire that was circulated among 70 odd people,

well spread out across the whole of Delhi. The same was done with the retailers to try and

see the conformity in findings in some specific attributes.

3. The questionnaire was to structured that an idea of brand image and relative studying of

various brand could also be elicited.

4. The findings were synthesized, and keeping in mind the new entrants, their potential and the

potential of the market, projections were made and conclusions were drawn.

Literature review

1.Fiorito & Laforge (1984) on the other hand have conducted a research on smaller retailers and

what kind of marketing strategies they have employed to stay competitive in the retail industry.

2 The two types of marketing strategies which are highlighted in the research as being commonly

used by small retailers pertain to integrated marketing strategy and differential marketing.

3 “The mission now is ruthless efficiency, eliminating the losers and refocusing budgets on

genuinely profitable activities” (Parsons, 1992). 

4 A study conducted by McMaster (1987), highlighted the importance of market strategies

pertaining to branding which aid the retail business to initiate growth and positioning for itself in

the market.

5 “The study concludes that sales growth has been the marketing strategy demonstrating highest

affinity to profit performance. Apart from this, increase in market share, capital-to-labor ratios,

and the average inventory level are keys to evaluating and selecting retail marketing strategies

which promise high profitability.” (Cronin, 1985)

6 The limited service offering and marketing strategy for catering to niche markets is analyzed

by Campo & Gijsbrechts (2004),

7 The paramount goal of marketing is to understand the consumer and to influence buying

behaviour. One of the main perspectives of the consumer behaviour research analyses buying

behaviour from the so-called “information processing perspective" (Holbrook and Hirschman

1982).

8 the information processing perspective, marketing analyses consumer behaviour by employing

a psychologically grounded concept of attitudes (Balderjahn 1988; Ronis, Yates et al. 1989;

Luzar and Cosse 1998).

COMPANY PROFILE

A household name for paste and tooth powder, Colgate Palmolive (India) was established on

23rd September 1937 as a private limited company in Bombay, as a wholly owned subsidiary of

Colgate Palmolive Co. Of USA Initially it started with trading activity and later set up

manufacturing operations in 1949 at Sewry (Bombay). The company became a public limited

company on 5th October 1978. In 1990-91 the company commissioned facilities for fatty acid

and toilet soap at Waluj (Aurangabad). The plants at Sewri and Waluj manufacture oral care

products like dental creams, tooth powder tooth brushes and personal care products like toilet

soaps, shampoo, which are marketed under various brand names such as Colgate, Palmolive,

Halo, Protex and Charmis. The company’s distribution network covers 1700 stockists and

4,50,000 retailers with ware house facilities in Mumbai, Calcutta, Delhi, Hyderabad, Lucknow

and Madras ( and a new addition at Faridabad). The company has its own Research and

development facilities and had also been getting the R&D benefits of the parent company. It has

a well established quality Control Department at Sewri & Waluj. For 40 years, since inception

till 1978, Colgate was carrying on its business in India with a paid up capital of Rs. 1.5 lakh

made up of 1500 equity shares of Rs. 100 each, when it was increases to Rs. 1.96 crore, by a

bonus issue in the ratio of 130:1. To comply with the FERA regulations, Colgate Palmolive,

USA diluted its share holding to 40% in the Indian company, through an offer of sale to the

Indian public in October 1978. Following FERA relaxation, the foreign shareholding was

increased from 40% to 51% in September 1993.

Colgate Palmolive (CP) is a global leader in household and personal care products. In 1991, it

had sales of $ 6.06 billion and a gross profit of $ 2.76 billion, its world wide R&D expenditures

were $ 114 million and media advertising expenditure totalled $ 428 million.

Colgate Palmolive’s five year plan for 1991 to 1995 emphasized new product launches and entry

into new Geographic markets, along with improved efficiencies in manufacturing and

distribution and a continuing focus on core consumer products. In 1921 $ 243 million was spend

to upgrade 25 of Colgate Palmolive’s 91 manufacturing plants, 275 new products were

introduced world-wide; several strategic acquisitions (e.g. of the Mennen men’s toiletries

company) were completed and manufacturing began in China and Eastern Europe. Since 1985,

gross margins had climbed from 39% to 45% while annual volume growth since 1986 had

averaged 5% International sales Colgate Palmolive’s strong unit, accounted for 64% of sales and

6% of profits in 1991.

COMPANY STRATEGY - ORAL CARE AND TOOTHBRUSH

INDUSTRY IN PARTICULAR

“Volume is the key” says Richard Usuquen, VP Marketing Colgate Palmolive (India) Ltd. To

expand the market in all ranges, CP has an ongoing RURAL VAN PROGRAMME and

SCHOOL PROGRAMME covering 14 million villages and 80 million consumers, teaching

people brush or even clean their teeth with the fingers. CP’s action centring around finely

balancing the urban market - (59.5%) and rural markets (68% share) . So while the company

has introduced such premium packaging as stand up toothpaste tubes with flip-up caps in the

urban market, it is also selling sachets of Colgate dental cream at low prices.

This focus on volumes is also evident in the toothbrush market, estimated at 400 million units

per annum. C-P is the toothbrush leader in India with an approximately 60% market share, but

since ‘95 it is facing challenges from HLL which has already garnered 8% market share.

Usuquen says “The penetration of brushes in India is very low, so more than market share, it is

important to grow the market”. To that end CP has actively introduced line extensions across all

three segments - economy, middle and premium since last year. At the entry level it has adopted

the sleeve packaging, with no individual cases. The focus is on driving volumes through the

price-sensitive segment. The mid-price market has been the introduction of the HIGH KLEEN

range, while the upper end has seen the zig - zag and Double - Action launches.

For the economy segment, a price focus has been adopted. On offer are five toothbrushes each

from the CP and Cibacca stables to rural consumers, at prices low enough to generate trial. For

the urban market, the focus is on maintaining novelty value by introducing new variants and

added features.

“Whatever is new, people buy. So the idea is to accelerate choice through a variety of product

features”.

CP’s perception of the Indian market is of one where people welcome change but clamour for

high end products at cheaply prices. The answer to this conundrum as per the company’s strategy

is to

“..... Optimise cost and formulation and the proceses and come up with efficient manufacturing

to answer this “. CP’s strategy is to pour in a lot of investment in the Indian market in terms of

capital expenditure and organizational support and each out to the deepest interiors.

SEGMENTATION

The toothbrush industry can be regarded as a component of the Oral Care industry which broadly

comprises tooth paste, mouth wash and floss, besides tooth brushes and a large unorganized

naturally available cleaning mediums viz. Index Finger, Neem twigs etc. But Colgate Plus need

not to bothered about latter as it operates in a different category.

The tooth brush industry can be segmented in the basis of social class & income group

(Demographic Segmentation ), price (Product segmentation), benefit (behavioural segmentation),

the last being the most important.

DEMOGRAPHIC SEGMENTATION ACCORDING TO PRICE

Segment Category Brands Characteristic

Low income rural

class

Economy Promise, Cibaca Looking for low price

Middle income

group semi urban

consumer

Standard Colgate Classic

Pepsodent popular

Value for money

Upper middle

income urban

consumers

Premium Colgate Plus,

Classic, Ajay, Royal

High quality cleaning

efficiency

Upper class urban

sophisticate

Super

Premium

Oral B, Aquafresh,

Jordan, Close Up

Unique, attribute,

dentists

recommendation

The last two categories merge, since Colgate Plus is intelligently positioned in between

the two to maintain a high quality in age as well as encourage switches from standard

category to up grade

PSYCHOGRAPHICS

Variations in

Product

Jazzy looks,

Transparent

handle Flashy

colours Superior

Packing

Simpleton looks,

Modest

packaging, Solid

colours

Mix of the two :

transparent

handle but not

very flash

packaging.

Urban

sophisticate

Chooses with

care, sports it as

a status symbol

while interacting

Abhors Abhors

in group travels

Semi urban Non

Chalant User

Aspires for it, but

finds it difficult to

afford; tries it

seldom

Very often goes

for this as it

serves is purpose

without much

expenditure

Some times this

Rural User Does not have

access/can’t think

of

Is the only option

Datun

Generally can’t

afford this either

Tooth brushes

brands

Oral B, Jordan,

Aqua fresh etc.

Promise, Forhans

etc.

Cibaca, Ajanta,

Ajay etc.

The overall response reflects a gradual move in the direction of the premium to super

premium segment as it is once in three months/four months purchase, thus being

successful in luring all customers (except the rural user who are a small minority of the

Market) to try out the ones that are places at a higher price on account of their trendy

looks and overall appeal of style and splendor.

BENEFIT SEGMENTATION

User

Characteristic

Invalid oral health

consumer

Therapeutic

Brushers

Involved oral

health Consumer

Cosmetic

Brushers

Uninvolved Oral

Health Consumer

Non-chalant

Brushers

Product

Differentiater

Search

functionally

superior product

with many

attributes.

Search for

product that

effectively

delivers cosmetic

benefits

Views products

as same Lack of

interest

Advertising

appeal

Put off by

hardsell Prefers

dentist

recommendation

or informed

opinion

Influenced by

promotion,

hammering on a

USP

Relatively

unaware of ads

can at most be

influenced by

price offs,

package deals

Buying behaviour Buys for himself,

will go to a

specialised store

Buys and uses

for himself. Will

not go beyond a

large shop,

supermarket

Buys for family.,

will pick up any

brand available.

Regularity of

usage

Brushes after

every meal

Brushes mostly

once, sometimes

twice

At most once a

day

Brand loyalty High Low Nil

Price (Willing to

pay)

>20 15-20 <12/0q

Major Brands Jordan, Oral - b

Indicator

Colgate Plus,

Pepsodent

Perfect

Colgate, Classic,

Cibaca, promise

TARGETING

Colgate plus has been intelligently targeted at the upper middle class, towards the lower

end of Premium / super Premium category to not only take advantage of growing

consumer affordability but also to provide a pull factor to family user in standard/popular

category to upgrade to higher quality Colgate Plus.

An implicit assumption about the large segment is that it is decently educated, hygienic

conscious and keenly discerning about the cleaning efficiency of the toothbrush used.

They primarily live in metros, urban areas, big towns, and have a good standard of

living.

At the time of its launch in 1987, Colgate Plus was the first indigenously manufactured

toothbrush in premium segment. Company claims, it built this segment single handily

and obviously has the first mover advantage exemplified by its No.1 position despite the

onslaught of variety of premium brands from abroad.

Colgate believed that with rising income & increasing westernisation, it could upgrade

the toothbrush market and consumer could be willing to pay a few rupees more for a

quality product.

DIFFERENTIATION & POSITIONING

In the toothbrush market which is heavily cluttered both in terms of brand varieties and

corresponding messages and constant hammering of almost similar USP’s it is very

difficult to differentiate and position a product as mundane as a tooth brush in the

consumers mind to persuade him to become a loyal user.

Positioning in tooth brush market done at various levels

PRODUCT : Design differentiation like angular neck, dolled rubber grip, rigged edges

and design of bristles, convenient head shaper etc.

These work only in upper segment, which is willing to pay a premium for added

attributes. Colgate Plus has a unique diamond shaped head & soft outer bristles.

PACKAGING :Cardboard cartons, transparent blisters, hanger shaped hooks, coffin

packing (storing when not in use). In a blister pack, packaging makes up to 40% of

cost. Colgate Plus comes in transparent blister pack with a hanger shape hook.

PRICE : By super premium pricing one can give a perception or aura of technical

superiority/high quality to a brush Jordan, Oral - B, Close Up Contact have followed this

route.

Or one could take value for money route to target large families and heavy user

economy pricing for market penetration especially in rural markets.

Colgate plus has positioned itself in lower end of super premium category.

RECOMMENDATION / RELIABILITY : Oral - B has its USP as the tooth brush most

dentists world wide use & recommend - One could go for celebrity endorsement in

cosmetic segment but its not at all an effective strategy in a low involvement product like

toothbrush.

Colgate world - wide has a image of brand for committed to public oral care and hence

its association with a dentists and the ‘ring’ of protection & confidence.

Positioning Colgate Plus as a higher quality product in the “Professional” segment was

an intelligent move as it prevented cannibalization of its other brands like Colgate

Classic.

BRANDINGColgate is a brand having a cult following. It world wide reach and association with

dental health has made it a brand associated with a caring attitude, providing quality

oral care to masses at an affordable price.

Colgate is No. 1 brand in Indian Market the three consecutive surveys by A & M

magazine. So, while launching the new toothbrush, it was imperative to keep “Colgate”

as a part of the name and incorporate something that could justify the increment in

price. As modifications in the form of an entirely new category “diamond head” was

introduced, it was ideally decided upon a name that promised to deliver something

extra, additive, etc. “Plus” was thus added on.

MARKETING MIX

PRODUCT

Product is anything that can be offered to a market for attention, acquisition, use or

consumption that might satisfy a need or want.

The product can be looked at five levels:

The Core product is the essential service that the buyer is buying. In this case it is Oral

care.

The Generic product is toothbrush.

The Expected product is a set of attributes that the buyer expects to get./ in this case

being, efficiency of cleaning, thoroughness in cleaning and care of gums.

Augmented Product is that what is provided by the seller beyond the expected product

attributes i.e. those attributes that seek to distinguish the product from others in its

category. Colgate Plus is put across as a complete dental care product. It uses its

diamond shaped head, soft outer bristles, hard inner bristles and accreditation by the

Indian Dental Association as its USP’s.

Potential Product refers to set of possible new features that might eventually be added

to the product being offered. Toothbrush as a product does not offer much scope

beyond changes in design and material/ shape of bristles. Design changes are usually

made on grounds of aesthetics, handling and efficiency in cleaning. Colgate Plus has

recently introduced Colgate Plus Zig Zag on the grounds of efficiency in cleaning.

Some product differentiates in the industry are ;

Pepsodent Popular - the Squiggle between the head and the handle is

flexible and stand along structure.

Jordan Magic - the colour changes to indicate when you have brushed

enough.

Close-Up Confident -a thick handle with a shall head giving better access.

Oral - B -blue tuft as indicator which loses colour as bristles

harden with use.

PACKAGING:

Packaging provides one with means and scope of differentiating in relatively

homogenous product market. Packs have graduated from cardboard cartons to blister

packs to let the consumer pick the colour of his choice. Some like Pepsodent Perfect

and Colgate Plus, come in hanger shaped hooks on the blister packs because most

small sized retail outlets lack the shelf space required to dangle peg-racks.

The pricing depends a lot on the packaging and advertising. In a blister pack,. The

product makes up 60% of the cost, packaging the rest. A coffin pack, where the brush

can be kept back after use, inflates the packaging cost. While these ‘hygiene packs’ do

prevent the toothbrush from accumulating dust, they end up with a double layer of

packing, the outer one indicating mandatory product details.

Major Operators in the Premium Toothbrush “Segment

Product/

Manufacturer

Feature Benefit Reason Tagline

Oral B

Indicator

(Gillette)

Indicator

Bristles

Tells you

when to

change the

toothbrush

Blue band

fades half

way

The brand

most dentists

use

Reach

(Johnson &

Johnson’s)

Angled neck,

raised rubber

ridges on

handle

Cleans even

hardest to

reach places

Slimmed

down tapered

head

Feel the

difference

Colgate Plus

(Colgate

Palmolive)

Diamond

Head, Soft

outer and

hard inner

bristles

Reaches

inner crevices

of the mouth,

gentle to

gums,

comfort and

efficacy

Unique

diamond

shaped head

(narrow in

front)

Because your

smile was

meant to last

a lifetime

Aquafresh Pressure Prevents gum Flexes as you For gentle

Flex

(SmithKline

Beecham)

sensitive

squiggle

neck, dotted

rubber grip

irrigation brush to

absorb extra

pressure

dental care

PLACE

A marketing channel performs the work of moving goods from producers to consumers.

It overcomes the time, place and possession gaps that separate goods from those who

want them.

The decisions regarding distribution channels are a very crucial part of the marketing of

Fast Moving Consumer Goods (FMCGs) more so because of tooth brush being a low

price product with negligible brand loyalty, no Consumer would be willing to walk more

than 2 km to procure a tooth brush and would accept, without much hesitation, any

toothbrush thrust upon him by the shopkeeper. So the markets has to make extra

efforts to ensure easy availability of this low involvement product, which is no easy task

in a country of the size & diversity as that of India.

Channel decisions have important implications for other elements in marketing mix.

Colgate Palmolive had to design a distribution strategy which would best attain following

channel objectives.

Achievement of greatest possible coverage of the target market

Ensuring that the consumer can easily procure the toothbrush (Under no conditions

stock out can be allowed.)

Maintaining mutually beneficial relationship with the retailers since tooth brush is

basically push marketed.

PROMOTION

The discussion of marketing mix elements cannot be complete without analyzing the

promotional strategy of the company. In a low investment category, where there is

hardly any individual who can call himself “brand loyal’ and most of them happy with

whatever toothbrush they can lay their hands on, without caring too much about price, a

marketing effort to ensure an optimum push and pull combination and an impact

presence in the consumers mental frame is a must. However, because of the callous

attitude with which consumers purchase a tooth brush, too much marketing effort in one

direction or some particular defined directions without immediate appraisal does not

make sense, more so because of the low turnover to promotional expenses. It simply

does not make sense to spend 20% extra on promotion to gain 0.2% extra market

share. In view of the above. Colgate Plus has been very selective about its campaign

and has moved between mediums very slowly.

Advertising Campaign

Colgate Plus launched in the U.S. in 1985, was introduced in India in 1987 and was

among the very few players in the premium segment. “Colgate” brand name was

capitalized upon with the diamond shaped head being shown as the ‘hero’ in oral care

and all set to take on the toothbrush market. As competition intensified it shifted its

focus on softness and comfortable feeling with efficiency in cleaning plaque. The

advertisements were screened on Doordarshan and in leading magazines. They were

targeted to the family as a whole, very much like the strategy for other Colgate

products. The focus gradually shifted to soft outer bristles and hard inner bristled to

ensure a caring approach to gums and meticulous cleaning. The tagline used was “ . . .

Because your smile was meant to last a lifetime”.

There was parallel thrust on Dentist Accreditation which successfully translated into

Colgate Plus beginning to appear on dentist prescriptions. However in the face of

intense competition, no large scale endorsement by event or personality was sought for

and Colgate Palmolive continued to target the family as it kept on doing with its

toothpaste.

Throughout its advertising strategy planning Colgate Palmolive relied nonprofessionals

agencies. The account is currently handled by :”Redifussion”.

Sales Promotion

1. POP : The company provided danglers, small posters and hooked/dispenser

packing to its retailers. These were particularly splashed across retail outlets during

the discount periods with “Red & Yellow” colour combinations to ensure high rate of

impulse purchases. However, besides the discount offers, no other POP display

means made much of an impact in terms of increase in sales.

2. Health Mela : Colgate Palmolive organizes a ‘Young India Dental Health melas in

select cities where free check ups and free sample distributions of toothpaste and

toothbrushes are done. This aims at achieving a three pronged strategy of

Increasing dental care consciousness

to create a good brand recall of Colgate oral care products

to increase the company’s image as a socially responsible entity.

3. Keeps India smiling - Ad campaign : In a break from its earlier attitude of only

ascribing to its oral care image. Colgate joined the list of companies basing their

campaigns on the 50 years of independence. They launched a “Vande Mataram”

series of campaigns with people from all walk of life coming and sharing their

experiences on how the times have changed for the better following it up with

“Vande Mataram”. The small snippet was followed up with Colgate being flashed in

the form of a smiling face, emphasizing both its attachment with the growth and

development of the Nation and its contribution in keeping India smiling for the last 50

years thus striking both an intellectual and emotional chord. The snippets were

strategically screened in key media slots.

4. Sponsorships : Though Colgate oral care products have not been witnessed to

promote any large scale events, Colgate has often associated itself with TV serials

based on social and family themes e.g., Humlog and Buniyaad - thus re-

emphasizing their positioning as a family products.

Though not all of the above specifically emphasized the promotion of Colgate Plus

toothbrushes, they are conclusive image building exercises for the company as a whole

and aimed at highlighting its supremacy and commitment to the ‘oral care sector’. As

such it automatically translated into an image building exercise for the toothbrush

category as well.

Colgate Plus was distributed free with the September : issue of the filmfare magazines.

PRICING

Generally the most important of all the P’S in a developing country like India where

semi-urban and rural population constitutes, a massive portion of the total market, has

to be decided upon after contemplating on all the aspects related to the market and the

product itself.

For a product like toothbrush, the major cost is that of packaging (about 40% of total),

the rest being spread over the bristles, the nickel silver wire holding the tufts in place

and on the body of the brush.

The prices of toothbrushes have taken a quantum leap. The costliest toothbrush in 1986

was Rs. 4/- which is today in the range of Rs. 25/-. Thus we have seem a major jump

in value sales vis-à-vis volume sales.

Colgate Plus when it was launched in 1987, was introduced as a champion product to

become the ‘hero’ of the toothbrush market meant to ‘keep your smile forever’. It

promised to deliver more than the rest and was priced accordingly and soon became a

major player in the market. At that time it was playing against ‘Jordan’ and ‘Royal’, both

of which were being imported. Gradually as the market expanded, with the several new

players coming in, Colgate Plus continued to be the top most brand of the players till

Oral - B, Aquafresh, Forhans Galaxy came in . So right now Colgate Plus priced at Rs.

18/- is behind Close Up Confident (Rs. 19.75/-), oral- B (Rs. 20/-) Forhans Galaxy (Rs.

22/-) and Aquafresh (Rs. 25/-). As such it is at the bottom level of the Super Premium

segment along with Johnson’s Reach (Rs. 18/-) Jordan (Rs. 19/-), Forhans Zest (Rs.

18/-) trying to deliver more value for money.

While the present strategy keeps Colgate Plus (all three-sensitive, adult and zig-zag) at

a penetrative pricing as regards to Oral-B, Aquafresh Flex and Forhans Galaxy, it gets

and advantage of superior oral care image vis-à-vis the other brands in the same price

brand.

The strategy can be said to be working well as Colgate Plus, as of today is the market

leader both in terms of volume and value share.

SWOT ANALYSIS

STRENGTHS

1. Colgate continues to be the number one brand in consumer perception as per A& M

survey of the last four years.

2. Colgate products are perceived as a champion of the oral-card industry.

3. Advantage of better penetration, and better presence in the consumers mental

faculties.

4. Massive retailer network and strong supply base.

5. Image of a ‘company committed to complete dental care of the whole family’.

6. Market growth of more than 25% in value terms.

WEAKNESSES

1. Lacks the universal appeal and accreditation of world wide players like ORAL-B,

AQUA-FRESH etc.

2. Has not been able to penetrate the rural segment in volume terms.

3. No regular system of feedback or appraisal of the sale status of is toothbrush.

4. Market growth of 10% in volume terms.

OPPORTUNITIES

1. Any ‘PUSH’ can be easily and quickly affected n account of its widespread

presence.

2. Doing a ‘NIRMA’ to the toothbrush market is something Colgate is quite capable of ,

given the base and vision that the company commands.

3. Investment into R&D and the sales campaign so as to effect a strong long term pull

can transform the nature of the market completely as not one has acted in this

direction so far.

4. With the average semi-urban/urban consumer ready to shell out this extra bucks it

pays to go n for technological innovations and addition of utilities to this low

involvement product which has to so far been centered only around cleaning of

teeth.

THREATS

1. Foreign brands like AQUA-FRESH, ORAL-B, JORDAN, etc are trying to take the

course of the market to different dimensions.

2. The low margins being offered might go against the prospects of Colgate plus in

case some player in the lower segment starts offering high margins.

3. Low Involvement category and poor brand loyalty - susceptible to sudden large scale

switching in a very short span of time.

SURVEY FINDINGS

CONSUMER SURVEY

FEATURES

1. No. of respondents : 67

2. Areas covered : Defence Colon, Khan Market, South Avenue,

North Campus, Sarojini Nagar

3. Nature of Survey : Structure Questionnaire

4. Objective : 1. To analyze brushing habits and associated

attributes of the general populace.

2. Get a feedback from the Colgate Plus

users.

5. Limitations : As only well to do families/people were

accessed, the findings are expected to be

asked to the premium and the super premium

segment.

FINDINGS

RESPONSE MALES (%) FEMALES (%) TOTAL (%)

Ask by brand

name

57.6 70.8 62.8

bought it in

person

73.3 75.0 70.4

eagerness to

spend

Rs. 5-10 29.0 0.0 22.5

Rs. 10-15 41.9 29.2 40.0

Rs. 15-20 25.8 45.8 30.0

> Rs. 20 3.0 25.0 7.5

ASCRIBED TO

No specific

reason

59.4 33.3 50.0

word of mouth 15.6 16.7 19.1

impressed with

advt.

9.3 20.8 11.9

shopkeeper

insisted

15.6 20.8 14.3

dentists advice 6.3 8.3 4.8

REPLACEMENT

FREQUENCY

0-1 MONTHS 23.5 12.5 17.4

1-2 MONTHS 26.5 29.2 28.3

2-3 MONTHS 23.5 29.2 30.4

3-4 MONTHS 23.5 16.7 19.6

> 4 MONTHS 2.9 16.7 4.3

FREQ. OF

BRUSHING

Once (per day) 50.0 28.0 46.7

Twice 44.2 68.0 46.8

after every meal 2.9 4.0 2.2

Not very

particular

2.9 0.0 2.2

pressed with

Advertisement

YES 11.1 22.2 12.9

NO 88.9 78.0 87.1

RELATIVE IMPORTANCE OF ATTRIBUTES

MALES FEMALES TOTAL RANK

PRICE 62.7 57.3 61.2 5

PACKAGING 40.2 49.3 44.6 8

DURABILITY 74.5 74.7 75.4 2

LONG HANDLE 51.9 60.0 57.0 6

FLEXIBLE NECK 52.9 60.0 57.1 6

COMFY. ANGLE 68.6 78.7 73.7 3

SOFT BRISTLES 78.4 86.7 82.9 1

LOOKS 46.1 40.0 44. 9

DIAMOND HEAD 36.3 41.3 38.9 10

GRIP 58.8 68.0 63.4 4

INDICATOR 28.4 41.3 34.3 11

COLGATE PLUS USERS RESPONSE

Males Females Total

v. Good

God Can’t say

v. Good

God Can’t say

v. Good

God Can’t say

Quality 17 73 10 40 60 - 21.5 65.5 13

Access 90 10 - 97.5 - 2.5 95.5 - 4.5

Value/price

42 50 8 60 23 7 51 32 17

Loyalty Yes-3

No-97

Yes-3

No-97

- Yes -3

No -97 -

FURTHER FINDINGS

BRANDS PERCENTAGE

COLGATE PLUS 30.96

CIBACA 14.28

ORAL-B 16.66

CLOSE-UP 9.52

PEPSODENT POPULAR 7.14

JORDAN 9.52

OTHERS 11.90

BRAND RECALL

BRANDS PERCENTAGE

COLGATE PLUS 20.47

PEPSODENT POPULAR 11.02

CIBACA 10.24

ORAL-B 9.54

AQUA-FRESH 7.59

AJANTA 7.09

OTHERS 28.35

Only about 5% of the respondents could not remember which toothbrush they were

presently using which were excluded from the above computing.

RETAILER’S SURVEY

FEATURES

1. No. of Respondents : 20

2. Areas covered : Defence Colony, South Avenue, Khan

Market, North Campus, Sarojini Nagar

3. Nature of survey : Structured Questionnaire

4. Objective : a) To gather the respond to new

entrants vis-à-vis Colgate Plus as

perceived by retailers.

B) Retailers favorite brand(s)

Margins offered

5. Limitations : Given the areas covered, the response

was bound to be asked in favour of the

upper class users.

FINDINGS

1 Availability

Easy : Classic, Aqua-Fresh, Oral-B,

Pepsodent, Colgate Plus

Not Easy : Royal, Forhans, Cibaca, Jordan,

Prudent.

2 Sales

High : Colgate Plus, Cibaca, Classic,

Pepsodent, Oral-B

Satisfactory : Close-up, Ajanta, Ajay, Jordan, Aqua-

Fresh

3. Profit Margins

Highest : Classic, Royal

High : Jordan

Medium : Oral-B, Aqua-Fresh, Reach, Cibaca

Low : Colgate Plus, Pepsodent, Close-up

* Highest Margin : 35-40% Lowest Margin - 10-15%

N.B. Colgate Plus features in the lowest level of margin and yet commands the highest

market share. The low margin was however denied by the Sales Office of Colgate-

Palmolive at Delhi, who claimed to offer equal to that of the industry standards.

Colgate Plus was not backed up by any appraisal system whatsoever.

Supply is kept regular on weekly basis.

4. Retailer’s Perception Of Preferences &

BY BRAND NAME 36.5%

CHEAP BRUSH 9.3%

SPECIFY PRICE RANGE 15.9%

EXPENSIVE 21.5%

TRY NEW ONESE 16.8

E. Retails insisted on “Pushing” Classic as it was moderately priced and yet offered a

very good margin.

* The “D” above was also substantiated by our consumer survey.

5. Which are the top three toothbrushes in terms of exist sales.

1 oral-B

2 Pepsodent

3 Colgate Plus

6 In case not covered above. What is the status of stock.

7 How do consumers ask for a tooth brush? (Rank them)

8 Which of these two companies make it a point to:

(a) Get a regular feedback

Colgate Plus yes

Aquafresh

(b) Maintain regular supply

Colgate Plus ¹ Yes

Aquafresh

9 Rank your profit margin for the following brands:

10 If the consumer does not ask for a specific toothbrush then which one

would you offer him? Why?

CONCLUSION

The present day brushing habits of the Indian society as a whole leaves a lot to be

desired - 41 toothbrushes are sold for every 100 persons per year! Total units sold add

u to a little over 400 million, growing at the rate of 10% p.a in volume terms and 25% in

value terms (difference explained by the shift to upper end of the market). This implies

not much inroad has been made into the rural and semi-urban market. Non-users

constitute about 65% of total population.

While the global brands try to create new markets and add new dimensions, there is

much greater latent demand.

Out of their stable of marketing strategies, advertising till now had been low priority for

the players (this was confirmed in our survey as 88.9% of respondents don’t recall the

ads). This indicates companies find it formidable to change the low involvement level

psyche of consumers and the route of aggressive sales promotion by way of price offs,

POP displays, tied sales and generous trade margins still hold the key to increasing off

take of toothbrushes.

No one has made a serious attempt in the virgin territory of 65% non-users (CP’s Rural

Van Programme is a recent drive). The thought of doing a Nirma to the toothbrush

market has escaped everyone.

Despite packaging constituting a substantial (upto 40%) of the cost of a toothbrush it

has found to have influenced the purchasing decisions of the buyers. In our survey

consumers corroborated to this effect (refer to the survey findings). Companies could

rethink their strategy of increasing differentiability by packaging and instead invest in

product development for the same.

SUGGESTIONS

Some possible product improvisations

Attached straight tongue cleaner cased in the toothbrush handle.

Cartoons character printed on the handle to attract kids.

Padding on the handle end to massage the gums.

Casing the toothbrush (for kids) in a toy form.

Neck with adjustable handle.

Get a certificate by the Indian Dental Association (IDA) for the toothbrush, like the

Colgate Calciguard Toothpaste.

Segregate the toothbrush types for different age groups, e.g.,

Children - Thicker handle for better grip, bright colours and cartoons printed on the

handle.

Young People of Teenager - more trendy colours and designs, like stripes or polka

dotted, more vibrant colours.

Adults - Simple designs and sober and decent colours.

For the new entrant

Introduce the product with the offer of one free toothbrush with the purchase of a

brush which will help in blocking and prepointing the purchase of the buyer.

As the target segment is the premium segment therefore, premium pricing of the

product is necessary.

Price the product at Rs. 251 -* or at Rs. 301- and not at Rs. 361 or Rs. 221- because

the shopkeepers face a problem in returning small changes of Rs. 31 or Rs. 31- and

Rs. 11 so they sometimes avoid the product as confessed by the shopkeeper.

Add value to the product by giving tips on taking good oral care, in the back side of

the package or a free pamphlet with the purchase of a brush, like brushing twice a

day, flossing, polishing, regular dental check-up by your dentist, this shows a caring

and concerned attitude by the company.

With the purchase of a toothbrush, give a free coupons which is to be filled in by the

consumer and can be used by him or her for getting a free dental check-up as when

and where specified in the advertisement in the newspaper. This kind of scheme can

be implemented by the company once in two three months.

However, these suggestions can be used by the big players in the market or the new

entrant, who has to be a big player because a large investment is needed for such

heavy sales promotion and also an attempt should be made to convert this low

involvement product into a high involvement as it is concerned with personal card and

hygiene and a product of daily use.

CONSUMER QUESTIONNAIRE

1. AGE : ¹ 15-30 Years ¹ 30-40 Years ¹ 40-50 years

¹ Above 50 years

2. SEX : ¹ Male ¹ Female

3. OCCUPATION :

¹ Govt. Service ¹ Self-employed ¹ Corporate Executive

¹ Student ¹ Others (specify __________________)

4. MARITAL STATUS : ¹ Single ¹ Married with children

¹ Married without children

5. AVERAGE MONTHLY INCOME/ALLOWANCE

¹ <Rs. 3000 ¹ Rs. 3000-6000 ¹ Rs. 6000-10000

¹ Rs. 10000 - 20000 ¹ > Rs. 20000

6. Which toothbrush do you generally use?

7. Name any other five toothbrushes that you can recall

1 2 3 4 5

8. Who purchases your toothbrush?

¹ Myself ¹ A family member ¹ A Subordinate

9. Do you ask for a toothbrush by name? ¹ Yes ¹ No

10.How much are you ready to spend on a toothbrush?

¹ Rs. 5-10¹ Rs. 10-15 ¹ Rs. 15-20 ¹ > Rs. 20

11.What prompted you to purchase your current toothbrush?

¹ Dentist’s advice

¹ Impressed with the advertisement

¹ Shopkeeper gave it to me

¹ A well-wisher recommended it to me

¹ Just bought it no specific reason.

12.How often do you replace your toothbrush?

¹0-1 month ¹ 1-2 months ¹ 2-3 months ¹ 3-4 months

¹ > 4 months

13.How often do you brush your teeth a day?

¹ Once ¹ Twice ¹ After every meal ¹ Not particular

14. What according to you are the relative importances of the following?

V. Imp Imp. Not so Imp.

Doesn’t matter

PRICE

PACKAGING

DURABILITY

FLEXIBLE NECK

COMFORTABLE ANGLE

SOFTNESS OF BRISTLES

LOOKS (TRANSPARENT HANDLE ETC.)

DIAMOND HEAD

GRIP

INDICATOR

15. Has any toothbrush ad (seen on TV/in a magazine) made an impact on you?

YES NO IF YES, THEN WHY

ORAL-B

AQUA FRESH

ROYAL

COLGATE PLUS

15.Kindly answer the following in case you have used Colgate Plus/Aqua Fresh

toothbrushes:

16.

AQUA FRESH COLGATE PLUS

QUALITY *V. GOOD * GOOD

* MODERATE

* NO GOOD

* V. GOOD * GOOD

* MODERATE

* NO GOOD

AVAILABILITY * EASY * NOT SO EASY

* DIFFICULT

* EASY * NOT SO

EASY * DIFFICULT

IF IT WORTH THE

PRICE

* YES *NO

* CAN’T SAY

* YES * NO

*CAN’T SAY

IF THE BRAND IS NOT

AVAILABLE, THEN I

* WILL WAIT

* WILL NOT WAIT

* WILL WAIT

* WILL NOT WAIT

THANK YOU FOR SPARING YOUR VALUABLE TIME!!

RETAILER QUESTIONNAIRE

1. Location of the store :

2. Selling toothbrushes since

3. Brands stocked

¹ Colgate Plus ¹ Cibaca Supreme ¹ Aqua Fresh

¹ Jordan ¹ Oral-B ¹ Royal

¹ Pepsodent ¹ Promise ¹ Ajay

¹ Ajanta ¹ Classic

4. Which are the top three toothbrushes in terms of exist sales?

1. 2. 3. 4.

5. In case not covered above. What is the status of:

1. Aquafresh ¹ Good ¹ Picking up Moderate ¹ Poor

2. Colgate Plus ¹ Good ¹ Picking up Moderate ¹ Poor

6. How do consumers ask for a tooth brush? (Rank them)

(a) Ask by brand name (b) Ask for a cheap brush

(c) Specify a price range (d) Go for an expensive brush

(e) Keep trying newer ones

7. Which of these two companies make it a point to:

(a) Get a regular feedback

Aquafresh ¹ Yes ¹ No

Colgate Plus ¹ Yes ¹ No

(b) Maintain regular supply

Aquafresh ¹ Yes ¹ No

Colgate Plus ¹ Yes ¹ No

8. Rank your profit margin for the following brands:

1. Cibaca Supreme 2. Colgate Plus

3. Oral-B 4. Aqua Fresh

5. Classic 6. Ajanta

7. Pepsodent 8. Jordan

9. What is your a) Highest Margin

b) Lowest Margin

10. If the consumer does not ask for a specific toothbrush then which one would you

offer him? Why?

BIBLIOGRAPHY

1. Business Today Library

2. A&M Issues of June ‘05, June ‘05, April ‘2006

3. CII Library

4. FORE Library

5. Kotler Philip (Principles of Marketing)

6. Kotler, Philip (Marketing Management).

ACKNOWLEDGEMENT

I would like to express my sincere thanks to Prof. ASHISH JHA

for entrusting me with a challenging project and along with it, his

help and encouragement has been exemplary.

I wish to place my sincere gratitude to the officials of concerned

organization and libraries who in spite of their busy schedule

always spared their time whenever needed.