Professional Documents
Culture Documents
Colgate
Colgate
I dedicate my dissertation work to my family and many friends. A special feeling of gratitude to my loving
parents, whose words of encouragement and push for tenacity ring in my ears. .
I also dedicate this dissertation to my many friends who have supported me throughout the process. I will
always appreciate all they have done.
I dedicate this work and give special thanks to my respectable teacher sir usmanahmad who give us such
opportunity to enhance our skills.
ACKNOWLEDGEMENTS
I wish to thank my group members who were more than generous with
their expertise and precious time.
Finally I would like to thank sir usmanahmad who assisted us with this project. Their
excitement and willingness to provide feedback made the completion of this
research an enjoyable experience.
Introduction
Colgate-Palmolive is a $10.6 billion global company serving people in more than 200countries and
territories with consumer products that make lives healthier and more enjoyable. The Company focuses on
strong global brands in its core businesses Oral Care, Personal Care, Home Care and Pet Nutrition.
Colgate is delivering strong global growth by following a tightly defined strategy to increase market
leadership positions for key products, such as toothpaste, toothbrushes, bar and liquid soaps,
deodorants/antiperspirants, dishwashing detergents, household cleaners, fabric conditioners and specialty pet
food.
The company began in 1806, when William Colgate, an English immigrant, set up a starch, soap and candle
business on Dutch Street in New York City, USA. Frances Smith was made a partner in the following year
and the firm became Smith and Colgate. William Colgate brought out his partner in 1813; the name was then
changed to William Colgate and Company.
In 1817 the first Colgate advertisement - "Soap, Mould and Dipt Candles" - appeared. A few years later,
William Colgate and his brother-in-law, John Gilbert, built a starch factory in an area that today is Jersey
City, New Jersey. The Dutch Street factory was moved there in 1847, though the business office remained on
Dutch Street. Principal products at that time were Windsor Toilet Soaps and Pearl Starch.
After more than fifty years in the starch, soap and candle business, William Colgate died in 1857. The
company then became known as Colgate & Company.
1860s - 1910s
In 1866, the company introduced perfumed soap and began the manufacture of perfumes and essences. Six
years later Cashmere Bouquet, the first milled perfumed toilet soap, was registered as a trademark.
Surprisingly, it wasn't until 1873 - almost seventy years after the company's founding - that Colgate &
Company produced its first toothpaste, an aromatic dental cream sold in jars. Then, in 1896, the company
made toothpaste much more convenient to use by introducing the first collapsible toothpaste tube, one
similar to those in use today.
Meanwhile in Milwaukee, the B.J Johnson Soap Company, founded in 1864, was about to change its
destiny. In 1898 the company introduced Palmolive Soap, a product that was so successful it prompted B.L.
Johnson to change its name to the Palmolive Company 1916.
By its 100th anniversary, Colgate & Company was manufacturing dental care products, laundry soaps, 160
different kinds of toilet soap and 625 varieties of perfume. In 1906, the company launched a plant expansion
at its Jersey City site, and a new 8-storey factory opened on the site in Jersey City. A few years later in 1910,
the entire Colgate organization left the original buildings on Dutch and John Streets and moved to Jersey
City.
It was on the roof of one of Colgate's factory buildings there that the first Colgate clock, its face measuring
37.5 feet in diameter and covering an area of 1104 square feet, was installed in 1908. The original Colgate
clock, which became a fixture on the New Jersey waterfront, was moved to a new Colgate factory in
Jeffersonville, Indiana in 1924 and was replaced with a new, bigger timepiece, which today is still one of the
world's largest single faced clocks. The new octagon-shaped clock measured 1963.5 square feet with a 25
foot, 10 inches long minute hand and a 20 foot long hour hand.
1920 - 1930
On the 7th January 1922, the Palmolive Company (of England) Ltd was incorporated, with the first
directors' meeting being held a month later when Bob Foster was appointed Chairman.
In 1925 a new name was registered, The Palmolive Company Ltd. At this time most of the display cards for
shop windows and point-of-sale inside chemists were produced in the USA and shipped over with the
product. It was not until the 1930s that the UK company commissioned its own advertisements.
In 1928 the Colgate Company merged with Palmolive-Peet Co. in the USA, and thus another name change
followed in the UK, Colgate-Palmolive-Peet Ltd.
It was in 1933 that an agreement was signed with the parent company in America to manufacture Colgate
products in the UK, and production started in London from a factory in Ranelagh Road (on lease since
1929).
With war clouds gathering over Europe, a wise decision was taken to establish a manufacturing base for
Palmolive in England. In 1938 the soap makers G.W. Goodwins& Sons were purchased and Palmolive was
produced in the Ivy soapworks at Salford, near Manchester, from July 1939, just six weeks before the
outbreak of war.
1940s - 1960s
After the war, things gradually returned to normal. In 1949 the Company decided to enter the detergent
business with Fab - a new detergent powder already on sale in the USA. Fab survived for a number of years
but was eventually discontinued having succumbed to the pressure of heavy competition.
Another brand brought over from the USA was a new type of foaming cleanser called Ajax. Launched also
in 1949, Ajax proved popular and became brand leader in the mid 1950s.
Colgate Chlorophyll was launched in 1952 at a time when the public were intrigued by anything
chlorophyll. Palmolive soap drew attention to the fact that "natures chlorophyll is in every tablet".
In 1953 the name changed to Colgate-Palmolive Limited.
By 1956 Colgate's share of the US market had reached 23% (from 9% in 1947).
New product launches in the 1950s included Lustre-Creme shampoo, Cue hair dressing, Kan-Kil aerosol
insect killer, Rapid-shave aerosol lather (1954), Ajax liquid all purpose cleaner with ammonia-plus
(promoted on TV as "cleans like a white tornado") and Cadum toilet soap in 1955.
In the UK in 1964, brand leader Colgate introduced Colgate fluoride, the toothpaste that "helps stop bad
breath and fights tooth decay". This was updated in 1970 with a new formula containing
monofluorophosphate or MFP, and two years later this brand was combined with the standard Colgate to
create Colgate MFP Fluoride.
The other major launch was Ultrabrite in 1968; "New Ultrabrite the extra-strength toothpaste for really white
teeth. You'll love its new zingy flavour too". Noticeably there was no attempt at directly linking the Colgate
name to Ultrabrite.
It was in 1965 that one of the most memorable TV advertising campaigns began for Colgate's "Ring of
Confidence". A continuous stream of TV commercials in the form of "before and after" mini stories showed
the lasting benefits of using Colgate. Even today many remember the sound of the effective "ping".
1970s - 1990s
1976 saw the arrival of Soft & Gentle aerosol, a new antiperspirant that did "not sting, even after shaving".
Its image evoked by its packaging, was feminine, kind and mild. Woodleigh Green, the shampoo and soap
with a fresh, green apple fragrance was introduced in 1979.
Under the worldwide Chairmanship of Reuben Mark, appointed to the position in 1984, Colgate-Palmolive
sold many of its recently acquired companies and concentrated on building strength in its core businesses of
oral care, body care, household surface care and Hill's Pet Nutrition.
Colgate was still Britain's top selling toothpaste and throughout the eighties the company continued to
develop its products, first with improved MFP fluoride, and then the introduction of Blue Minty Gel - the
first toothpaste to target 9 -14 year olds. In 1986 Colgate Junior was introduced and Colgate Tartar Control.
In 1984 the new pump action toothpaste dispenser made its debut, and five years later another packaging
improvement, the easy to use flip top cap.
Innovation and focus describe the company's activities in the nineties. Perhaps the most innovative
development came in 1993 with the launch of Colgate Total toothpaste - the most effective toothpaste
available. This was just the start of new toothpaste introductions - Colgate Platinum (1995) for that "fashion
model" whiteness, Colgate Total Fresh Stripe (1995) and Triple Cool Stripe (1996) and Colgate Sensation
Deep Clean (1997).
Other new arrivals appeared in the Soft & Gentle range with a Smooth Solid (a completely new format for
anti-perspirants) and Lights, using the latest fragrance. Soft & Gentle had always had fragrance as a key
differentiator, and it is this aspect of the product that is constantly changing to keep up with current fine
fragrance trends. Soft & Gentle cream was launched in 2001. The roll on had aloe vera added in 2002, and
there was also a packaging upgrade.
Palmolive entered the growing market for shower gels with a range of "irresistible" products all designed to
leave the skin smooth to the touch.
1999 saw the launch of Colgate Whitening and Colgate Superstar. Colgate Fresh Confidence was launched
in 2000, and in 2001 Colgate Herbal and Colgate Total Plus Whitening arrived.
Executive Summary:
Colgate Palmolive is a well-reputed organization with a large series of its well-known products which
provides consumers daily needs. Colgate is one of the most famous products of Colgate Palmolive Pakistan.
In this project we are going to introduce a new product which is available in orange flavour which has been
made specially for kids .The Aim of this project is to provide the best quality of product which helps to
boost the market share. It reflects the companys best opinion as to how it can most profitability apply its
skills and resources in the market place. As therefore the first priority for the company is the quality of
product, therefore we focus on our product according to specific standards We decided to evaluate the
various segments and want to improve the performance of each segment.. Colgate is serving consumers
through Differentiated Marketing. Using different types of products flavour, and it focus on demographic
segmentation But Colgate Junior by Colgate Palmolive next focusing on target market of childrens. The
product consists of Orange cooling crystal Gel which is specially manufactured for kids ranging 4 to 9 years
.The company focuses on a best quality fruity crystal gel with maximum calcium and fluoride.This will
distinguished companys product from our competitors. And Colgate Junior will be a high priced andhigh
quality pastes whose price corresponding substantially with its quality.As we know that Colgate is the
market leader in oral hygiene. We will expand our market. We will launch our product (Colgate orange) in
the other provinces of Pakistan like Sindh and N.W.F.P.Thecompany try to increase our net profit more than
23% of the sales by the end of 2009.and our aim is to achieve 10% of the market share by the start of 2009.
The company goes for exclusive distribution and has an indirect channel of distribution. Colgate Junior
adopts market skimming pricing strategy, product line pricing strategy, promotional pricing strategy, and
geographical pricing strategy.History of Colgate Palmolive:In 1806, William Colgate opened up a starch,
soap, and candle factory on Dutch Street in New York City under the name of "William Colgate &
Company". In 1857, William Colgate died and the company
was reorganized as "Colgate & Company" under the management of Samuel Colgate, his son.In 1872,
Colgate introduced Cashmere Bouquet, a perfumed soap. In 1873, the firm introduced its firsttoothpaste,
aromatic toothpaste sold in jars. In 1908 they initiated selling toothpaste in tubes.In Milwaukee, WI, the B.J.
Johnson Company was making a soap entirely of palm and olive oil. Thesoap was popular enough to rename
their company after it - Palmolive.A Kansas based soap manufacturer known as the Peet Brothers merged
with Palmolive to becomePalmolive-Peet. In 1928, Palmolive-Peet joined the Colgate Company to create
the Colgate-Palmolive-Peet Company. In 1953 "Peet" was dropped from the title, leaving only "ColgatePalmolive Company".In the beginning of television, Colgate-Palmolive wished to compete with Procter &
Gamble as asponsor of soap operas. Although the company sponsored many shows in part, they were most
famousfor being the full sponsor of the serial The Doctors.George Henry Lesch was president, CEO, and
chairman of the board of Colgate-Palmolive in the 1960sand 1970s.In 2006, Colgate-Palmolive announced
the intended acquisition of Tom's of Maine, a leading maker of natural toothpaste, for US$100M. Tom's of
Maine was founded by Tom Chappell in 1970. This announcement has received both praise and criticism,
with many questioning why a company with a'No animal testing' policy would sell themselves to a company
that does test on animals when notrequired to by law. Harvey A. Colgate currently manages the company. He
and his wife have twochildren, Kathryn and Carleton, and are currently worth $358 Million.
For the past 33 years the Colgate-Palmolive Company has sponsored a non-profit track meet open towomen
of all ages. This event is called the Colgate Women's Games. The Colgate Women's Games isthe nation's
largest amateur track series open to all girls from elementary school through college. Our goal is to provide
an athletic competition that helps the participating young girls and women develop astrong sense of personal
achievement and self-esteem.
"As we plan our strategies to sustain growth for the years to come,
our core values of Caring, Global Teamwork
and Continuous Improvement will continue to drive our future initiatives."
Mission statement
Our three fundamental values Caring, Global Teamwork and Continuous Improvement are part of
everything we do.
They are the foundation for our business strategy and are reflected in every aspect of our work life.
Colgate-Palmolive Values
Our three fundamental valuesCaring, Global Teamwork and Continuous Improvementare part of
everything we do. They are the foundation for our business strategy and are reflected in every aspect of our
work life.
Caring
The Company cares about people: Colgate people, customers, shareholders and business partners. Colgate is
committed to act with compassion, integrity and honesty in all situations, to listen with respect to others and
to value differences. The Company is also committed to protect the global environment and to enhance the
communities where Colgate people live and work.
Global Teamwork
All Colgate people work as a part of a global team, committed to working together across countries and
throughout the world. Only by sharing ideas, technologies and talents can the Company achieve and sustain
profitable growth.
Continuous Improvement
Colgate is committed to getting better every day in all it does, as individuals and as teams. By better
understanding consumers' and customers' expectations and continuously working to innovate and improve
products, services and processes, Colgate will "become the best."
Our Products
Throughout the world, people like you can trust our family of brands to care for the ones they love. From
toothbrushes and toothpastes to bar soap, household cleaners, every day our products improve the quality of
life
for
consumers
worldwide.
Toothpastes
Sparkle
New
Palmolive
Naturals
Tooth Brushes
Palmolive Softwash
Brite
Power
Max
Brite Anti-Bacterial
Scourers
Lemon
Brite
Max
Machine
Wash
Liquid
Lemon
Maximum
Max
Antibacterial
Express
Power
Bonus
Tristar
Bonus
Active
Express
Bar
Softlan
In this project we are going to discuss oral care category, toothpaste brand of colgate.
SWOT Analysis
SWOT Analysis is a simple framework for generating strategic alternatives from a situational analysis. The
Swot analysis classifies the internal aspects of there company as strengths or weaknesses and the external
situational factors as opportunities and threats. Strength can serve as a foundation for building a competitive
advantage and weaknesses may hinder it.
Strengths:
Orange Gel:-First time in the Pakistani market we are going to introduce the toothpaste with orange
gel. It will provide you the maximum freshness in yours mouth through out the day. This will keep
yours teeth
Maximum Protection:-Colgate orange gel contains sodium fluoride that helps in preventing exposed
root cavities and preventstender gums. Colgate provides the total 12- hours protection of yours teeth
Friendly Environment:-Colgate provides you the employee friendly environment that provides the
positive impact on society.
Weaknesses
Due to high rate of taxes our prices are higher
Giant competitors like pepsodent and close-up.
OPPORTUNITIES:
Large investment:-High investment is the biggest Opportunity for the Colgate- Palmolive Company.
Intensive distribution:-As the product is daily useable commodity so the company is using intensive distribution
which provides an Opportunity for the company that the Colgate Orange is available at every shop and due tothis the
sales of the company is increasing day by day.
Stable economic conditions:- Stable economic conditions boost the growth of the product.
Threats:
In the threats that Colgate feels there are
. Competitors:-In Pakistan there are many companies in the field of toothpaste manufacturing so there is a
huge rate of competition in the market. Some international companies are also offering their products of
thiscategory. China is also offering their products at lesser price so this is another threat for the ColgatePalmolive company and also for their product that is Colgate Orange
. Unstable political conditions. Unstable political conditions are biggest threat for stable continuation of
colgate. Change in polices, and other tax situations is a disturbing factor.
PEST analysis
Political Factors:
Political factors play a vital role for the business prevailing in the country. If thegovernment is inactive then
the company advances at a standard rate but the other way round, a drastic fall can be seen.
Economical Factors:
Another imporatant external force that directly affects our decisions is the economic variation. If a country
experiences inflation then it will have a negative impact on the businesses running in that country. So our
product is directly influenced by this factor.
Socio-cultural factors:
The main forces affecting decisions about our product are the social and cultural factors. Before taking any
decision we have to keep in mind the specific religious and cultural keyfactors for our survival in the
industry because people will repel the product that their religion or culture do not prefer.
Technological factors:
Technology is a factor whose value cannot be ignored. Technologies vary with the passage of time in all
industries. We also make our techniques and methodologies up to date for keeping our product preferable in
the market.
Situational analysis
The situational analysis attempts to address the question where is the organization now? The situational
analysis contains a vast amount of information and, as the term indicates, is an analysis of the situation that
you are facing with the proposed product or service.
1. Company analysis
1.1 Company profile
Colgate, founded in 1806 by William Colgate, is acknowledged as the worlds leader in personal care sales
including oral hygiene products such as toothbrushes and toothpastes. Colgate has many subsidiary
organisation located in more than 200 countries.
1.2 Growth and profitability
Global sales as reported were $15,327 million during the financial year ended December 2009 ($15,330
million in 2008). The operating profit was $3,615 million during 2009, an increase of 16.6% over 2008. At
present, Colgate has a market share of 44, 4% in the worlds toothpaste market operating in more than 200
countries and territories. In the United States, one of the world largest consumer markets, Colgate is the
market leader in toothpaste sales with a market share at 36.2 % (Colgate-Palmolive Annual Report 2009,
p.2-4). Operating in more than 200 countries the company is not depending on one single market.
Significantly for the global presence is that over 82% of the company's 2009 revenues came from outside the
United States. The markets in industrialised countries are largely saturated. Because of the strong presence
especially in emerging countries such as pakistan and Brazil Colgate takes advantage of the positive
consumer trends in these countries and can compensate the sluggish economic growth in industrialised
countries.
1.3 Culture
Colgates success is linked to its culture, which encourages all Colgate people to demonstrate personal
leadership every day. Personal leadership also include three fundamental global values of the company:
Caring, Continuous Improvement and Global Teamwork (Colgate-Palmolive Annual Report 2009, p.19).
1.4 Goals
The main goals of Colgate are to better understand consumers behaviour, launching new products through
innovation, increasing effectiveness and efficiency as well as strengthening the leadership worldwide
(Colgate-Palmolive Annual Report 2009, p.4).
1.5 Collaborators
Colgate is working closely with thousands of small shop owners and local wholesalers to ensure greater
availability to their products as well as to provide the right assortment of products with best visibility in each
store. To built credibility among the consumers Colgate cooperates also with dental professionals.
1.6 Customer
The selling of Colgates products depends on chain reactions. If there is a growing population rate
worldwide or in local markets, the need for oral hygiene products increases. Today the world population is
approximately 6.85 Billion, predicting a world with 9.2 people by midcentury. Because of the globally
presence of Colgate, there will be 2.35 billion new potential customers until 2050 (United Nations world
population prospects 2008). Here is to point out that the average age of the population is not essential
because all people have a need for oral hygiene products. Furthermore Colgate offers premium products
which mean the consumer is willing to pay a high price for the product in order to receive high quality
products.
1.7 Competitors
The main competitors are Unilever, Procter & Gamble and the Clorox Company. The personal care industry
is mostly controlled by these companies. On the one hand in order to gain more market share within this
industry, the only way is to take it away from one of these competitors. On the other hand Colgate must also
be aware of losing market shares to their competitors.
s
Main cometitors are....
1. Marico
2. L'Oral
3. Nirma Ltd
4. HUL
5. ITC
6. Procter and Gamble
7. Dabur
MARKETING STRATEGY
Strategy is a decision which will affect all the subsequent tactics. Marketing strategies are the means
bywhich objectives will be achieved. It reflects the companys best opinion as to how it can most profitably
apply its skills and resources in the marketplace. Marketing strategy is the broad statement of the way in
which the organization sets out to achieve these objectives. Included within this would be a series of
decisions on the markets in which the organization will operate the type of product it will offer and the basis
of the competitive stances. Strategies endow us with a broad direction directing the waythrough which we
can achieve the desired position or objectives.It includes:
Market Segmentation
Market Targeting
Market Positioning
Market Segmentation:
Markets consist of buyers and buyers differ in one or more ways. They may differ in wants,
resources,locations, buying attitudes and buying practices. Dividing a market into smaller groups of buyers
withdistinct needs, characteristics or behaviorswho might require separate products or marketing mixes.This
is what we call market segmentation.To target the market in a better way, we have divided our market on the
basis of following four variables:
- Geographic
Demographic
Psychographic
Behavioural Geographic
geographical
We have divided Pakistan in four segments on the basis of provinces. But our targeted segment willbethe
biggest Province of Pakistan, Punjab keeping in mind the factor of population. As Punjab is the biggest
province according to population (as depicted in the subsequent pie chart) so we will start our business from
Punjab. We have selected Punjab for different reasons. One major reason has been mentioned earlier that
Punjab is the biggest province of Pakistan and this is the safest market to do business. Some other reasons
are that Punjab is the most prospered and developed province and thereare much developed cities than other
provinces like Lahore, Multan and Faisalabad, Islamabad andRawalpindi etc. With the passage of time we
will expand our business all over the country
Demographic.
The basic selected variable from demographic segmentation is age. Our product (Colgate Junior)
isspecifically manufactured for kids. This is the reason why we will target kids from 4 to 9 years of age.As
mentioned earlier, the product is designed keeping in mind the younger population nevertheless people
ranking above the age limit can also utilize our product as it is not a detrimental product.
Psychographic
Psychographic segmentation has been done on the basis of social class. Middle class and High classwill be
targeted because our product will not be within the means of middle class society. We willspecifically design
our marketing strategy according to our selected segments.
Behavioral
According to a national survey by Colgate Palmolive in 1999 only 16% of the total population of Pakistan
had been using toothpastes as a mean of daily oral cleansing. Since now toothpaste is a product which is not
used occasionally in urban areas round the country. People use toothpastes dailyand their attitude towards
toothpaste is quite positive because dentists advise to clean teeth after everymeal and at least twice a day for
healthy teeth. Kids are specially advised to use toothpaste because of different reasons. So to attract the kids
towards toothpaste we are introducing orange flavor of Colgate(as orange flavor proved to be the most
demanding in accordance with our survey)
Market Targeting:
Market segmentation reveals the firms market segment opportunities. The firm now has to evaluate
thevarious segments and decide how many and which segments it can serve best. A target market consistsof
a set of buyers who share common needs or characteristics that the company decides to serve.
Targetmarketing can be carried out at several different levels. The company can target very
BCG Matrix:
The BCG Matrix was created by the The Boston Consulting Group (BCG) and it became one of themost
well-known portfolio management decision making tools in the early 1970's. It is based on the product life
cycle theory, and it is used to prioritize the product portfolio in a company or department.There are two
dimensions - market share and market growth.The basis idea in using the Matrix is the higher the market
share a product has, the higher the growth rate and the faster the market for that product grows. Colgate fall
in star because of high market share and high growth. It use large amounts of cash and are leaders
in the business so it should also generate large amounts of cash. - frequently roughly in
balance on net cash flow. However if needed any attempt should be made to hold share,
because the rewards will be a cash cow if market share is kept.
It generate large amounts of cash because of their strong relative market share, but also consume large amounts of cash because
of their high growth rate; therefore the cash in each direction approximately nets out. If a star can maintain its large market share,
it will become a cash cow when the market growth rate declines.
Toothpastes
Sparkle
Tooth Brushes
New
Palmolive
Naturals
Palmolive Softwash
Max
Scourers
Lemon
Antibacterial
Power
Brite
Max
Anti-Bacterial
Max
Express
Power
Bonus
Tristar
Bonus
Active
Express
Softlan
Maximum
Liquid
Lemon
Brite
Bar
CDC
Colgate
Total
3.
Colgate
Herbal
4.Colgate
Advanced
White
Colgate
5.
Colgate
6.
Misvak
Max
7.Colgate
Fresh
Gel
Sensitive
8.Colgate
Original
Sensitive
Multiprotection
Colgate CDC
Colgate Maximum Cavity protection contains calcium and fluoride. Its superior formula penetrates teeth to
lock in natural calcium to give you strong and healthy teeth. It also fights cavities and provides thorough
cleaning for your teeth. Colgate Maximum Cavity protection has a refreshing taste that will leave your
mouth feeling fresh and clean. It is available in several sizes: 30gms, 50gms, 75gms, 100gms, 150gms and
200gms.
Colgate
Colgate
Total
Total
fights
germs
for
12
hours
and
helps
prevent:
Plaque
Gingivitis
Cavities
Bad Breath
Tartar
Build-up
Colgate
Herbal
Colgate Herbal is a unique combination of Colgates wide experience in oral care and natures best herbs for
healthier teeth and gums. It protects teeth against cavities, providing care for your teeth and gums in a
natural way.
Colgate
Herbal
contains:
Clove
to
provide
toothache
relief
fresh
Mint
Eucalyptus
for
a
for
breath
fresh
and
feeling
unique
flavor
mouth
and
Advanced
White
Colgate Advanced White with micro-cleaning crystals is clinically proven to gently polish and effectively
whiten your teeth. With regular use, it also removes plaque and fights cavities keeping teeth healthy while
making them white.
Colgate
Misvak
Colgate Misvak with its unique Misvak extract based formula helps protect against cavities and cares for
your
teeth
and
gums.
Strengthens
teeth.
Freshens
breath.
Colgate Sensitive
It is specifically designed to provide fast relief from the pain of sensitive teeth. People who feel pain when
eating/drinking hot or cold food should use Colgate Sensitive. The brand comes in three sizes, 50gm, 100gm
and 150gm. It is very important to use a product for sensitive teeth or it can turn into a more serious
problem. Regular use (2 to 4 weeks) of Colgate Sensitive provides fast relief from pain of sensitive teeth
of tubule occlusion
Helps
block
pain
stimuli
such
as
tactile,
pressure
and
cold
air
With 1450ppm fluoride as sodium monofluorphosphate
Core product
Toothpaste is an oral care product. Antacid is a drug while dandruff shampoo is a hygiene product. All of
these come under health care products. Therefore, Colgates core product is a health care product when it
sells toothpaste or other products in its new line. The core benefit the product will provide to consumers is
total health care.
The hub benefits are stated asfollows
: Prevent Tooth Cavities
Prevent Exposed Root Cavities
Fight Against Bad Breath
Reduce Plaque
Reduce Gum Problems
Strengthen Weak Tooth Enamel
Remove Stains.
Actual Product:
Brand name: Colgate is sub brand of colgate Palmolives brands.
Quality: We are determined in providing the brand, assuring quality and affordability to the major sector of
the country, initially to the major sector of Punjab. The quality is the factor that cannot becompromised in
any condition as the leading brand of Colgate assures the best quality paste to itscustomers.
Design and style: The design and style of Colgates all products are set to be quite appealing and catchy for
kids. Kids are usually more attracted towards colors and cartoons. So keeping in mind this fact, colgate has
been associated with most preferred cartoon character Tom & Jerry as preferred by themajority in research.
So the product is considered to be pleasing for kids through unique design andstyle
Features: The toothpaste is manufactured as health care product and enclosed in attractive tube packaging.
Augmented Product:
It includes the classification of our product, website address and helpline number or U.A.N number for
assistance and after sales services. Web site address of Colgate Palmolive is www.colgate.com.pk andthe
helpline number is (92-21) 5698000, 5685867. After sales services include the responsibility of replacing the
damaged or expired piece from the customer. If we consider the categorization of our product then it falls in
the category of staples in Convenience Products.
Branding: A brand is a name, term, sign, symbol, design or a combination of these, intended to identifythe
goods or services of one seller or group of sellers and to differentiate them from the competitors.Branding
has become so strong that hardly anything goes unbranded..
Brand Sponsorship: Colgate is a Manufacturers Brand (National Brand) because Colgate isdistributing its
product with its own brand name as created and owned by Colgate Palmolive itself andcan be available at
general stores, key outlets (walking stores) and karyana stores.
Price
What is the value of the product or service to the buyer? How much are the targeted customers willing to
pay for the product? Is the customer price sensitive? How will your price compare with your competitors?
The amount of money that one has to pay to buy the product is known as price. Price is the element in
marketing mix that produces revenue while the other elements of marketing mix generate cost only. They
company must set its price in relation to the value delivered and the value perceived by the customer. Being
as a market leader in tooth paste industry Colgate sets its prices in view the product itself, target customer
class and competitors product prices.
Pricing Strategies
Colgate has maintained the custom of launching the new product at low prices so that every customer can
take a trial of the product.
Colgate changes its prices to meet the competition but only at that time when the prices of competitors
decrease because of national change in prices. Every customer has to pay the same amount to buy the
products of Colgate Palmolive in Pakistan. It means the company is following uniform delivered pricing
strategy for all its products.
There are various pricing methods used by Organizations currently
Cost recovery Pricing: Cost recovery pricing Is the pricing method followed by marketers such that they
recover the cost of the product and put a small profit margin on it to finalize the pricing of the product. For
example some firm incurred the cost of $100 per product they would like to have a profit of $20, then the
pricing will be $120.
Penetration Pricing:- Penetration Pricing is the pricing method, in which the price is decreased abruptly so
to penetrate the market and achieve greater market share. Company with deep pockets when entering a new
market often practices this pricing, at times the price may be lower than the cost of the product. The
profitability can be achieved later due to monopolistic situation or by cross selling their other products
(Kotler, 2003).
Price skimming: Price skimming is the pricing policy adopted by the organization so that they first launch
the new product at very high price so that early adopters can buy the product and then they subsequently
decrease the price to get late bloomers buying the product. This pricing is practiced mostly by technology
firms and is observed with the launch of new.
Placement
Where do buyers look for your product or service? Are your products available at the right place, at the right
time, in the right quantities? What do you competitors do, and how can you learn from that and/or
differentiate?
Placement plays a vital role in the life cycle of product so we will place our product at:
Departmental stores
Shopping malls
Target retailers
As we already have a very strong distribution network of other products of same brand so we will usethe
same distribution channel and network that is considered to be a very strong key factor indistribution
procedures.
Market Positioning
Distribution:
Marketing Channel or distribution decisions are among the most important decisions that managementfaces
and directly affects many other marketing decisions.
Channel level: Our product will follow a chain in which from the manufacturers (Colgate Palmolive),the
product goes straight to the ware houses of distributors then to the respective zones (separationsmade by
Colgate Palmolive for the ease of distribution to multiple cities). Then after pricing, the product goes to the
shops (retailers) and finally to the customers and end consumers.Manufacturer Ware house Retailer
Consumer
Conventional marketing channel: We will have a conventional marketing channel since we have
adistribution channel structure in which Colgate Palmolive places its products in the shops of retailers or
sales them to the wholesalers and they do not work like a single team.
Type of distribution: Colgate is dealing with a few authorized dealers. As the number of authorized dealers is
9 so it follows Selective Distribution Channel. We have two distribution channelsinrawalpindi, 1 in
Islamabad, 1 in multan, 4 in Lahore and 1 in faisalabad. Above mentioned only theauthorized distributors
are allowed to deal with Colgate Palmolive and henceforth with Colgate for the sake of distribution
Promotion
Promotion is a communication means adopted by the marketer to communicate about the product, brand or
organization to the consumers. Promotion has following four distinct elements. Advertising, personal
Selling, Public relations and Sales Promotion, which can be used as such or can be used in combination to
promote the product (Pride & Ferrell, 1983).
The promotional strategy which Colgate Junior will adopt to cop up with the competitive market would be
firstly to focus on awareness of the new product. This would be done by placing stalls and countersof
Colgate Junior 30g tube free of cost, outside the schools. Then next step would be promotion through
magazines, newspapers, billboards, pamphlets, T.V channels along with buntings in the shops.Making
attractive T.V advertisements would definitely attract and urge children to try it because of itscatchy
appearance. We would focus on increasing the sales with the passage of time to gain control onthe besieged
chunk of market share. More precisely:
Our first and foremost objective is to provide market awareness to our target customers.
Power of advertisement while using both media (Print & Tele).
Use of cartoon characters which are favorite in kids like Tom & Jerry, Snoopy etc (It will be decidedon the
basis of market research).
Also to offer free samples to the target consumers to check the quality of offered product that
issubstantially high.
Pull straegy
Colgate will implement pull strategy in order to be a magnet for customers. This will be done
through strong advertisement and awareness strategies. Magazines, newspapers, billboards and
cablenetworks are considered to play an imperative role for this purpose. This scheme will pull the
tendencyand demand from the consumers. We will also focus on arranging events for kids
like drawingcompetitions, puppet shows and color festivals for kids as a mean of promoting Colgate
Push strategy on the other hand can also serve the same purpose of promotion. By giving special
considerations to the retailers, we can push our product to the end consumers. But the main focus
will definitely be on pull strategy i-e to urge the consumers for the demand of the specific product
and thus making loyal customers for the brand.
Promotional mix:We are supposed to use the following steps in our promotional mix:
Advertising
Personal Selling
Public Relations
Sales Promotion
Direct MarketingAdvertisement:
We will advertise our product through television, billboards, magazines, newspapers and brochures.
Bill Boards:We will also advertise our product through billboard because the kids who watch our ads on
televisionwhen they will watch our value added product on billboards they will definitely enforce their
parents to buy it for them.
Television:We will advertise our product on local area cable network because it is the most effective way to
getthe attention of the kids, after that we will switch towards the advertisement on famous
televisionchannels including Geo, Aag and PTV. We will run our commercial ads especially during the
intervalsof cartoons and children concerning serials or in times when children can almost cetainly watch TV.
Newspapers & magazines:We will also advertise our product in newspapers and magazines using interesting
and appealing pictures of their favorite cartoon characters so that more kids can be made aware of our
product. Themost preferable magazines would be Aurora, Blaze and Review through which we are suppose
to publish our advertisements. Newspapers which are selected for this purpose are Dawn and Dinnewspapers
Pull straegy
Colgate will implement pull strategy in order to be a magnet for customers. This will be donethrough
strong
advertisement
and awareness
strategies.
Magazines,
newspapers,
billboards
and
cablenetworks are considered to play an imperative role for this purpose. This scheme will pull the
tendencyand demand from the consumers. We will also focus on arranging events for kids
like drawingcompetitions, puppet shows and color festivals for kids as a mean of promoting Colgate
Push strategy on the other hand can also serve the same purpose of promotion. By giving
specialconsiderations to the retailers, we can push our product to the end consumers. But the main
focus willdefinitely be on pull strategy i-e to urge the consumers for the demand of the specific
product and thusmaking loyal customers for the brand.
Product life cycle
The product life cycle means every product has a capability such that it can be used for a certain period of
time. It passes through the different stages of life as a man moves from childhood to maturity and old age.
Similarly products have life cycles by which they are monitored and evaluated. The first stage in the product
life cycle is product making or development. The product is in development when the companies are making
specific products which they invest their money in and get nothing from these products at this stage.
Secondly the product is introduced in the market. This is second stage. At this the stage the
advertising campaign is run on television to tell people about this product. The product suffers with the
competition in the market. In this stage the price is low because the product is in the launching stage. Heavy
expenditure is being put on the promotions to boost sales. The nextstage is the growth stage. In this stage the
sales of the product are on a peak and the product has captured a large geographical area. The product has
deeply penetrated into the market at this stage. The product has great distribution in the market and is
available in every shop of the market.
Introductory Stage:
Motive: Creating awareness
In this stage:
Branding begins and quality levels are established. If possible, patents and trademarks are obtained for the
intellectual property. Distribution is limited, costs are high, and volume is low.Promotion is based on
creating awareness and making a place in the market.eg: Nokia N97. Its just introduced in the market
Growth Stage:
Motive: Penetration, Positioning and loyalty.
In this stage:
Prices are steady to declining, as every participant in the industry is focused on market share and becoming
the low-cost producer. Costs are declining with increasing volumes, and profits are improving. Distribution
is increasing as well. Competitors are attracted to enter the market.
During this stage, as competitors enter the market:
Marketing strategy starts to shift from education and awareness to differentiation.the sales presentation
moves to strong proposals and demands higher presentation skills. There is a need to develop trust. The sales
cycle is longer, and there are more complex decisions. eg: shampoo of Fiama. After the introduction its
in the growth stage.
Maturity Stage:
Motive: Visibility (Reinforcement)
The market maturity stage occurs when the market has become saturated. During this stage:
Sales growth rate tends to decrease. Efforts are focused on differentiation of the product. Pricing may be
lower because of increased competition. More internal pressure is placed on reducing costs. Margins begin
to shrink as marginal competitors are forced out of the market. Distribution is maxed, and promotions come
into play as a way to encourage preference over competing products.eg: Colgate toothpaste
Decline stage:
The market decline is recognized by the downturn in the demand for the product. It may be caused by the
introduction of an innovative new product or changing consumer tastes. As volume declines, competitors
focus on maintaining market share while maximizing profits. Efforts focus on reviving the product by
adding features and finding new uses.
In this stage, one of these can be done:
Repositioning Withdrawal Run-Out Phase out.
In this stage, the costs will remain steady or decline. Advertising should be reduced unless there is some
hope of repositioning the product in an effort to prolong its life and the potential for profits.
eg: Maruti SX4
Competitive moves:
There are four competitive moves:
Market
Market challenger
Market follower
Market nicher
Our firm is the market leader so we will adopt market leader strategies.
Market leader:
We will expand our market with the time. We will launch our product (Colgate Junior) in
the other provinces of Pakistan like Sindh and K.P.K
satisfaction is a key parameter that makes protecting market share possible. It indicates possible
weaknesses in operations and addresses areas where to charge. Measuring customer satisfaction is
therefore important task of marketing department of the company. Other important task is to
benchmark competitors, and try to find out how they tempt customers, what will be their
followingmoves and implement lucrative moves first. So we will provide value to our current
customers to retainthem because the customers are big assets of a firm. We will also analyze
the competitor's strategies,what they are offering to their customers and how they tempt their
customers.Competitive Positioning Strategy:Consumers typically choose products and services that
give them the greatest value. Thus marketersshould position their brands on the key benefits that they
offer relative to competing brands. There aremany competitors in the market but our close
competitors are Close-up, Pepsodent and Medicamtoothpaste. They are also providing good quality
pastes but our competitive edge is superior qualityfruity crystal gel with maximum calcium and
fluoride.This will distinguish our product from our competitors. Our overall positioning will be
MORE FOR MORE. More for more positioning involves providing the most upscale product and
charging ahigher price to cover the higher costs. Colgate Junior will be a high priced and a high
quality pastewhose price corresponds substantially with its quality. This product will give prestige to
the buyer anda satisfaction of using a desirable brand. Using superior quality in association with this
strategy alsosymbolizes status and life style. Often the price difference exceeds the actual increment
in quality.
inflation, we were able torestrict our administrative expenses which merely grew by 0.01% as compared to
last year. This was possible as aresult of strict cost controls by management.
The net profit after tax for the year, however, decreased by 1.98%. Earnings per Share also decreased by
1.99% to
PKR 36.45 as compared to PKR 37.19 last year.
Financial Position at a Glance
Due to better working capital management by the Company, Cash and Cash Equivalents increased by
25.55% closingat PKR 1.05 billion as compared to PKR 0.84 billion last year. Total short term investments
at year end stood at a levelof PKR 978 million as compared to PKR 255 million last year. The increase of
283.14% resulted in an increase in otherincome by 43.35% as compared to last year.
A brief financial analysis is presented as under:
Operating Results
2012-13
2011-12 Increased/(Decreased) By
Gross Revenue
25,515
23,328
9.38 %
Net Revenue
20,267
18,709
8.33 %
Gross Profit
5,673
5,412
4.82 %
Gross Profit
% 27.9
% 28.9
% - 100 bps
Operating Profit
2,278
2,261
0.75 %
1,589
1,621
- 1.98 %
7.8%
8.7%
- 90 bps
36.45
37.19
- 1.99 %
throughout the year to build awareness about oral hygiene. Our mobile dental units allow us to reach
consumer in
small towns and villages with no access to dental care services. Operated by qualified dental surgeons, these
mobile
units examine consumers' oral health and educate them about good oral hygiene practices to prevent from
dental
ailments. These measures continued to strengthen our partnership with the Dental Profession community.
Additionally, for over a decade we have been partnering with hundreds of schools across Pakistan to engage
thousands
of children to participate in our global art contest based on the theme 'My Bright Smile'. The contest not only
provides
the children an opportunity to showcase their talent on an international level but also to learn about good
oral hygiene
practices. A record breaking 70,405 artworks from these highly talented children were received this year
which is a
55% increase over artworks received last year.
To demonstrate our company's beliefs in contributing back to our community and in reducing our impact on
environment,
Earth Day Celebrations at Colgate was observed in which various activities were under taken by the
employees which
included tree plantation, community work, walk and seminars.
The Company also made donations amounting to PKR 16.20 million for health, education & social welfare
projects.
Future Outlook
The new Government was sworn in and presented its first national budget for the year 2013-14. Given the
stagnant
issues such as weakening Pak Rupee, high inflation, worsening energy crises and poor law & order situation
the
Government will need to take immediate steps to resolve these persistent issues otherwise they will continue
to hurt
the business environment in Pakistan.
Competition in Pakistan has been very aggressive and is expected to intensify its' spending in our three main
categories
namely; toothpaste, dish washing and detergents.
We are however confident about the future prospects of your Company as the demand for consumer
products has
been resilient and is expected to increase further in the years to come as we see a growing middle class
emerging in
Pakistan with an ever increasing awareness of consumer products amongst the masses. We are working
internally
to become more efficient by becoming more cost effective and are looking to consolidate our position in
existing
markets and explore new avenues.
Financial & Corporate Reporting Framework
The Directors are pleased to state that the Company is compliant with the provisions of the Code of
Corporate
Governance as required by Securities & Exchange Commission of Pakistan (SECP).