COLGATE PALMOLIVE INDIA LTD.

By:

Abhinav Varsney(115)

Anamica Bansal(123)

Gunjan Dawani(149)

K Rajasekhar(155)

COLGATE PALMOLIVE INDIA LTD

COLGATE PALMOLIVE - CIBACA TOOTHPASTE

• Client: Colgate Palmolive

• Product: Toothpaste

• Brand: Cibaca

MARKETING MIX FOR COLGATE PALMOLIVE INDIA LTD

• Colgate Palmolive is the market leader in the Indian oral care market, with a 51% market share in the toothpaste segment, 48% market share in the toothpowder market and a 30% share in the toothbrush market

• The strategy of the company in Oral Hygiene Products on the basis of 4 P's would be as follows:

Products• CP came up with another strong brand other than Colgate named Cibaca.

Cibaca was priced lower than Colgate in order to target the rural consumer.

• CP positioned some innovative toothpaste with a brand name other than Colgate but under the umbrella of Colgate Palmolive.

• Colgate Herbal brand was expanded to herbal clove flavor, herbal lime and mint flavor etc.

• In toothpowder, it endorsed the development of ‘Colgate Ayurvedic Toothpowder'

• They came up with sachets of tooth powder targeted toward rural population, who buy in smaller lots.

• For toothbrush, CP worked on functional benefits and launched different toothbrushes for different age groups.

Price• The prices were largely based on the competitor's price. • For the niche products e.g. Colgate herbal, Colgate Blue etc, It charged

higher premium than the generic dental white crème that was focused on consumption by lower income classes.

• The pricing was done on the basis of price points and the packaging was customized on the basis of price points.

Place• CP increased its product penetration to rural population.• By 2003 the rural population where rich and consuming class was 209Mn,

not much less than urban rich and consuming population of 253Mn people.

• CP increased the wholesalers to smaller towns and tracked the distribution path so that they are covering all the village areas around the towns.

Promotion• For rural consuming class CP endorsed Cibaca toothpaste. • Most of the promotional expenses were made on T.V. and radio.

CHANGE IN THE MARKETING STRATEGY TO MEET THE SHORTCOMINGS OF THE PREVIOUS STRATEGIES.

SLOWDOWN IN INDUSTRY• The oral care market declined by 9% in 2002-03 in value terms. • The rural market declined by 6.2%. • An analysis of the de - growth trend revealed that In the rural markets,

67% of the decline was attributed to drop in consumption. 6% of decline was due to partial shift to tooth powder, while almost 18% of decline was due to total shift to Toothpowder.

• Over 9% of decline in volumes was attributed to consumers exiting from the category itself and moving back to traditional denitrifies

NEW MARKETING STRATEGY• Colgate decreased the price by 17% on its toothpastes, in a bid to spur

volume growth in the category. • This was a major strategy change as compared to the promotion driven

marketing being undertaken previously, which failed to generate the anticipated growth.

• Although ad spend in absolute terms has been lowered by 20% at Rs1.85bn, Colgate has managed to increase its share of voice in the toothpaste category from 43.1% in FY03 to 51.3% , reflecting that category ad spend have gone down significantly.

“COLGATE'S BRIGHT SMILES, BRIGHT FUTURES”

• The Colgate Bright Smiles, Bright Futures Oral Health Educational Program was practiced to teach rural children positive oral health habits of basic hygiene, diet and physical activity. This Program also encouraged dental professionals, public health officials, civic leaders and most importantly, parents and educators to come together to emphasize the importance of oral health as part of a child's overall physical and emotional development.

• Under this Program Indian children in primary and government schools received instructions on dental care from members of the dental profession nominated by the Indian Dental Association.

• Education was imparted with the aid of audio-visuals and printed literature created by the company.

• Free dental health care packs, including samples, were also distributed by the company to encourage the practice of oral hygiene.

COMMUNICATION STRATEGY

• Pitched against low priced products using Colgate lineage and the resultant global quality assurance at the same price point.

• A well planned mobile marketing activity, which included interactive product oriented game, an edutainment film using well know regional TV stars , besides product sampling, sales and placement.

• Another promotional tool used was dental check – ups by Colgate dental health day, where the rural population was educated about the right way of brushing one’s teeth and a free check – up was offered to all.

RESULT

• Awareness for the brand increased multifold ,which was reflected in the spontaneous increase in sales of coming years.

NEW TOOTHPASTE MARKET

• The company had undertaken a 17% price cut in flagship toothpaste brand Colgate Dental Cream (CDC) in the first quarter and a substantial price reduction of Colgate Cibaca in the second half. These reductions affected about 65% of the sales in FY04. Despite the lower value growth due to price reductions, Colgate has been able to grow volumes in the toothpaste segment since FY03.

• Toothpaste volumes grew by 3.5% during the FY04 as against an 8.3% decline in FY03.

• The growth trend in first five months of 2004 revealed a robust 7.9% growth in volumes as against a 5.1% decline during the previous period.

COLGATE IMPROVES MARKET SHARE

• Despite the slow down Colgate managed to improve market share in all the three categories and that too in just one year.

Toothpaste (+1.2%)

Toothpowder (+1.1%)

Toothbrush. (+0.4%)

SUCCESSFUL LAUNCHES

• The company launched ‘Colgate Herbal White’ in the toothpaste range and ‘Colgate Motion Kids’ - India’s first battery powered toothbrush for kids in the Toothbrush category.

• New launches in the personal care portfolio include Palmolive Aroma range of Toilet Soap, Liquid Hand Wash, Shower Gel and Talcum Powder.

These have also contributed to the volume growth as well as revenue.

FUTURE STRATEGY

• Colgate plans to focus on strengthening dominance and reignite growth in core oral care business. The strategy would be to defend and grow base business and improve share in fast growing LPP (low price point) segment.

• The company plans to build preference for Colgate Cibaca by leveraging on ‘Colgate’ equity and matching prices of competitors to counter LPP threat(next slide). The company plans expand market by using local press to communicate value and through micro targeting within key LPP states.

• Over the long term, Colgate plans to build a strong presence in emerging PCP (Personal Care Products) liquids categories. While this is small segment, the company expects the category to grow sharply over the next 5-10 years and it would emerge as an important business in future. Personal products currently account for 7% of revenues.

LPP Threat• Regional brands use flanking Strategy of 2 types – geographical or need

based.• In geographical attack, the challengers identify area where the new brands

are under performing and thus use the establishment in the regions to eat into the global brands share.

• The other strategy is to serve the unfulfilled market needs. These regional brands are not just well – established they have also started delivering on the quality front, to protect their market share.

THANK YOU