COLGATE-PALMOLIVE (INDIA) LIMITED
Background
Colgate-Palmolive India Ltd (CPIL) is a 51 per cent
subsidiary of Colgate-Palmolive Company (CPC),
USA. CPC’s main business is manufacturing and
marketing of oral care products, toilet soap, and
shaving products.
With an employee strength of 1130, CPIL has grown
to a US$ 230 million company with a wide
distribution network in India. Colgate is a household
name in India with one out of two consumers using
Colgate toothpaste. Colgate has maintained its
leadership and emerged as India’s No. 1 brand across
all categories for eight out of nine years since 1992.
Market Share
CPIL is the market leader in the Indian oral care
market with a market share of 51 per cent in the
toothpaste segment, 48 per cent in toothpowder
segment and 30 per cent in the toothbrush segment.
Major player in oral care segment
Colgate was voted the “Most Trusted Brand” in 2003
in India by the Economic Times and the AG Nielsen
ORG MARG survey.
Colgate was rated the No. 1 brand across
all categories in A&M’s annual survey of India’s Top
Brands conducted by Taylor Nelson Sofres-MODE
in 2001.
From a modest start in 1937, when hand-carts were
used to distribute Colgate Dental Cream, Colgate-
Palmolive India today has one of the widest
distribution networks in India - that spans 2.7 million
retail outlets across the country, of which the
company services 8,00,000 outlets directly.
Factors for success
Strategic initiatives
CPIL has been able to increase the sales volume of
the toothpaste and tooth powder segment by about
13 per cent using the following initiatives:
• Adopted a strategy of new launches and
a significant hike in marketing expenditure.
• Targeting schools to create oral awareness
among children.
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• Launched a National Oral Health Program called
“Bright Smiles, Bright Future” in association with
the Indian Dental Association to spread awareness
about oral care amongst children.
Creating demand in rural areas
In order to create new demand for oral care products,
CPIL has increased their reach in rural areas. It is
converting non-users to users through various sales
promotion measures such as small volume low priced
sachets, distribution of free toothbrushes, Rural Van
Programmes, among other things, especially in rural
areas. Rural areas contribute to 35 per cent of
Colgate’s sales.
Nurturing and retaining talent
Colgate Palmolive has successfully created a
healthy and motivating work environment by
taking measures like:
• Talent Management
Management: The company has
developed talent in-house for critical resource
positions in Marketing, Sales and Customer
Marketing. 10 per cent of employees have
been provided with international training in the
last 5 years.
• Com
Commumu nication
munication
nication: The company is leveraging IT
to reach out to all employees across the
organisation using “Intranet Chats” as well as
organising “Town Hall” meetings with corporate
visitors.
Using IT to enhance business processes
CPIL has made investments in information technology
to enhance the speed and quality of financial systems
and increase operational efficiency in supply chain,
distribution and human resource management.
Supply chain simplification
CPIL is simplifying the supply chain system
through Stock Keep Unit (SKU) reduction. From
480 SKUs in 2001, Colgate has reduced SKUs to
220 in 2003.
Leveraging the India Advantage
Leveraging the IT advantage
CPIL has outsourced its IT related services to a
local software company for various services
including network provisioning, voice over IP (VoIP)
implementation, IT infrastructure lifecycle
management services, network audits, security, local
area network (LAN) services and desktop
management, thereby effectively reducing costs.
Vast consumer base in India
Colgate is leveraging India’s vast population and the
increasing purchasing capacity of the Indian middle
class. Colgate is tapping the large Indian consumer
base to establish a strong presence in the country.
The branded oral care penetration in India is only
about 42 per cent. Clearly, the oral care market’s
growth potential and opportunity are huge.
Future plans
• CPIL has made investments of over US$ 10
million in the new manufacturing facility in
Himachal Pradesh to meet local demand.
• Colgate is planning to increase exports to Sri Lanka
and Bangladesh.
• Colgate plans to extend usage of e-auctions into
new areas such as freight, insurance etc. The
company conducted 19 e-auctions in 2003.
Colgate Palmolive (India) Ltd:
AT A GLANCE
• 1130 employees. US$ 230 million revenues.
2.7 million retail outlets across India of which
the company services 800,000 directly
• Household name. One out of two consumers
of toothpaste use Colgate
• “Most trusted brand – 2003”: The Economic
Times and AG Nielson ORG MARG survey.
No. 1 brand across all categories in A&M’s
annual survey of India’s top brands conducted
by Taylor Nelson Sofres MODE, 2001
• Factors for success: Strategic initiatives.
Creating demand in rural areas. Nurturing and
retaining talent. Using IT to enhance business
processes. Supply chain simplification
• For Colgate Palmolive, India is: IT service
source. A vast consumer base. A market with
great potential
• Future plans, India: Has made investment
of US$ 10 million in a new manufacturing
facility in Himachal Pradesh. Increase exports
to Sri Lanka and Bangladesh. Extend usage of
e-auctions into new areas such as freight,
insurance etc.
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