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Qestions - Assignment Example

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The major strategic issue that Colgate entered in with regards to seeking to enter into the partnership that it did with Hawley and Hazel was the fact that it believed it could seek to utilize Hawley and Hazel’s existing infrastructure and supply channels as a springboard to…
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Qestions
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Section/# Colgate Case Identify the major strategic and ethical issues faced by Colgate in its partnership with Hawley and Hazel
The major strategic issue that Colgate entered in with regards to seeking to enter into the partnership that it did with Hawley and Hazel was the fact that it believed it could seek to utilize Hawley and Hazel’s existing infrastructure and supply channels as a springboard to penetrate markets that it did not currently have a powerful presence within. The major strategic blunder was of course the failure of the firm to review the range of products that Hawley Hazel offered as a means of judging whether the particular type of strategic partnership about to be engaged upon would be mutually beneficial for all parties involved. Likewise, the major ethical issue involved was once it was determined that Hawley and Hazel had a highly racially offensive product how Colgate would seek to deal with such a problem in its very large domestic US market.
2. What do you think Colgate should have done to handle the situation
As is usually said – hindsight is 20/20; however, it is the opinion of this student that seeking to demand that Hawley and Hazel discontinue and/or rebrand the product immediately or risk termination of the partnership should have been engaged upon as a means of ameliorating the damage that would be done to the domestic market based upon the negative reaction of many civil rights groups etc.
3. Is it possible for Colgate and Hawley and Hazel to change the toothpaste’s advertising without sacrificing consumer brand loyalty? IS that a possible reason for Colgate’s not responding quickly to domestic complaints?
Ultimately, the answer to the first question is yes. Regardless of how ingenious a marketing rebranding strategy that could have been engaged with, a certain level of loss would doubtless have been realized and other competitors would have greatly benefitted from such a rebranding. Moreover a rebranding requires a large amount of up front funding in addition to the necessary losses that would be exhibited upon brand loyalty. As a function of weighing this level of necessary loss, Colgate opted for merely hoping to ride out the storm; however, as this did not happen, Colgate made a very cost miscalculation.
4. In the end, was a “no management rights” clause good for Colgate? What could have happened during the negotiation process to get around this problem?
In the end, a “no management rights” clause was most certainly not the right decision for Colgate. Due to the fact that once the Hawley Hazel toothpaste debacle came to light Colgate had little if any leverage to seek to force a change in branding from the firm it had allied itself with. A far better approach, if the firm had still been set upon a “no management rights” clause would have been for Colgate to perform a very thorough analysis of the firm to ensure that it met all standards that Colgate itself would have met within the United States; in this way, the firm would have made what this author considers to be a much more informed decision on the given partnership than what actually occurred. Read More
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