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 Hill’s 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..
• In 1898, B.J Johnson was making soaps entirely out of Palm and Olive
oil
• The company was renamed to “Palmolive”
• Peet brothers merged with Palmolive to form “Palmolive-Peet”
• In 1928, the company bought Colgate-Palmolive and was renamed to
“Colgate Palmolive-Peet Company”
• In 1953, it was renamed to “Colgate-Palmolive Company
Change in the Therapeutic Segment..
 In 1950, Crest’s 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 1960’s and
early 70’s.
• “Elmex” is a medical toothpaste sold since 1962
• “Fresh Start” was a detergent launched in 1970.
Colgate - Palmolive’s focus on International Business
and on other segments…
• “Irish Spring”, a deodorant soap was launched in 1972
• “Hill’s 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 Tom’s of Maine were bought by ColgatePalmolive. Tom’s 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-Palmolive’s Global Market Share remained almost constant
for 5 years, upsetting Crest’s 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 making them
leaders in the emerging markets hence flexibility .
Opportunity
 The Chinese market is not familiar with the “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.
SWOT
Threats
 The greatest threat for CP is Crest, and it is shown that
Crest has been gaining market share through the
cosmetic segment.
 CP’s 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
Benchmarks
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
6
3
Purchase Intent (%)
Product Expectation (%)
Colgate Max Fresh Launch Strategies - Mexico
Pricing:

Pricing objective was to achieve parity with Crest’s 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
America
President
Profit & Loss
responsibility
Europe
President
Profit & Loss
responsibility
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 CIC’s 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 it’s 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.