Colgate-Palmolive Company:The Precision Toothbrush.

This is a presentation on the Harvard Case Study of CP-Precision Toothbrush. It addresses the most important issues required by the company to develop and increase its growth and sales.

2. The Company
Board

Susan Steinberg
(Product Manager)

Reuhen Mark
(Colgate-Palmolive CEO)

Nigel Burton
(Divisional General Manager)

John Philips
(Colgate plus Manager)

3. COMPANY HISTORY
•Colgate Precision Toothbrush: A product line extension technological
breakthrough.

•Launched in August, 1992.

•An unparalleled leader in global markets for household products.

•Suffered market loss from other competitors due to introduction of newer
products in the market.

•In 1991:
Worldwide research and development expenditures
$114 million
Media advertising expenditure
$428 million.

5. What is the PRESENT
Scenario?

6. 1 – SITUATION ANALYSIS

8. 2- THE US TOOTHBRUSH
MARKET

9. 3-CONSUMER BEHAVIOUR

10. WHY STUDY THIS ?

11. OBJECTIVES
EFFICIENT
TRANSFOR
MATION
MARKET
SEGMENTA
TION
COMPETITI
ON
BRAND
IMPACT

12. Focus on THREE inter-related
issues.

13. Issue 1
How Precision should be branded,
positioned and communicated to the
customers?

14. Issue 2
What the advertising and Promotion
budget should be and how it is to be
broken down?

15. Issue 3
How to develop a profit and loss
analysis to unlock Precision’s full
potential?

16. How Precision should be branded, positioned
and communicated to the customers?
Product
Designing
and
Testing.
Positioning Branding
Communic
ation and
Promotion

17. Product Designing and Testing
In laboratory analysis,
researchers used infrared motion
analysis to track consumers
brushing patterns. With this
information CP developed the
toothbrush with bristles of three
different lengths and
orientations.

18. Positioning
•It could be positioned as a
niche product to be
targeted at consumers
concerned about gum
disease.
•Precision could be
positioned as a mainstream
brush, with the broader
appeal of being the most
effective brush available on
the market.
•Steinberg believed that
with a niche positioning,
volume sales can increase.

21. Branding
•Name tests were conducted among those
consumers positively disposed towards the
concept.
•The Colgate Precision name was
consistently viewed
more favorably.
•Under the mainstream and niche
positioning scenarios, that cannibalization
figures for Colgate Plus would increase by
20%.

22. Communication and Promotions
•Four concept tests, conducted
among 400 adult professional
brush users.
•“You can really feel it
working.”Consumer word to
word promotion.
•Steinberg was considering 50%-
off offer on any size of Colgate
toothpaste (up to a value of
$1.00 and other discounts.

25. Results of four Concept Tests
Test 1:
(69+68+66)/3=67.67% probably
buy.
(15+15+10)/3=11.67%definitely
buy.
Test 3:
(63+72+62+66)/4=65.75% probably buy.
(13+16+11+14)/4=13.50% definitely
buy.
Test 2:
(80+71+74+68)/4=73.5% probably buy.
(19+19+18+14)/4=17.5% definitely buy.
Test 4:
(87+61)/2=74% probably buy.
(19+48)/2=24% definitely buy.

26. What the advertising and Promotion budget
should be and how it is to be broken down?

27. Media Expenditure and Shares of Voice

28. Television and Advertising Copy Strategies

29. Colgate Plus Television Advertising

30. Advertising and Promotion Expenditure

31. How should a budget of
$24,058 be broken
down?

33. How to develop a profit and loss analysis to
unlock Precision’s full potential?

34. Income Statements for Colgate Palmolive

35. Breakeven Analysis

38. Competition is the final
issue.

39. Competition 1

40. Competition 2

41. Competition 3

42. Competition 4

43. Summary
•CP Precision is a technological
breakthrough, not just a niche
product.
•How it is branded, positioned and
advertised?
•What advertising and promotion
budget should be?
•A profit loss analysis enabling
Precision to reach full potential.

45. DISCLAIMER