Marketing Strategy of Colgate-Palmolive - Case Study Example

Business environment has now turned to be both challenging and quite exciting. This has therefore made marketing professionals come up with better marketing tools and techniques meant to achieve market share, sales and profitability. This study shows oral health care company in Singapore and marketing of Colgate products. Boone and Kurtz (1998) describe that Colgate-Palmolive has been in the market since 1993 with its marketing strategies based among product, price and promotion. Apart from toothpaste the industry also produces toothbrushes, dental floss and mouth wash. The aim of these products is to sensitize individual on the best practice of protecting the germ and to maintain a good oral hygiene at all times. The toothbrushes have been changed frequently in terms of shape, sixe, color and the texture of the bristles in order to satisfy customers’ needs. Apart from satisfying customers there is need to remain competitive among others for example Oral-B, Close-up, etc. who have also entered the market. At first people used to buy any kind of product without caring about the benefits but as competition became more aggressive, companies advertised about the benefits of the products they supply. This made consumers become aware of the different types of oral health products and mostly went for Colgate as it focused on healthy gums, hygiene and the protection of cavity. These promotions made Colgate Company that was founded by William Colgate become popular to all. In stead of concentrating on soaps and perfumes that they had at first they focused mostly on producing toothpastes. According to Stanley and John (2009) in the year 1992 the Company became the market leader in the production of both household goods and oral health care products and was making 20 percent of sales which were increasing annually. Their marketing strategy for production of toothbrushes aimed at producing a superior quality and one that removes plaque which was also technically improved. Other products produced such as Colgate Herbal White that was introduced in 2002 was specifically meant for those who believe in using herbal products. It is of a high quality and its ingredients include eucalyptus, mineral and lemon that were included to ensure the brightening of teeth. In its packaging, the managers introduced a green pack which was to stress on its herbal ingredients. This package also attracts consumers as the writings are in white. The companies marketing strategy was in a way that the consumers determine the kind of product to be produced and the company have to plan on satisfying customers needs. According to Beacham et al. (2000) in the year 1999, the company changed its marketing strategy where instead of informing the public on the benefits that come with the use of the tooth paste they talked of the procedure used to achieve better protection of teeth and gum. This strategy introduced was mostly meant to attain core competence against their competitors. However the strategy was not satisfactory as it did not bring much benefits to the manufacturers, they therefore turned to their old strategy of marketing. The packaging of the product included an indicator of fighting germs that came with oral care. This method of promotion was to inform the public how germs are fought after the use of the product and it was significant as more users were attracted by the branding. Due to the increased competition, the company changed its promotion strategies by offering deals on purchase for example if you buy one product you get one free product. According to Farese et al. (2000) these promotions increased the company’s sales by about 30 percent. Other promotion strategies involved percent off coupons and mail in rebates which also saw an increase in company’s sales. According to Kevin and Robert (1999) described that the 2004 forum focused on strategizing the company’s global programs in order to increase returns through commercial investments, technological improvement and increase in distribution. The company was to develop new products for example the Colgate Max fresh and simple white toothpaste which increased sales by 20 percent. The company also has been performing due to its increased research and development programs in oral care products. Involving themselves in community development has also increased awareness and consumer trust. One of the company’s competitive advantage is the fact that it has been in existence for a long time now and thus strategic managers and other have experience with their customers and are able to understand the market in a better way. One example is where they introduced plastic tubes which were easy to use unlike the leaded ones. The other major change included introducing small packages which could serve the poor thus making the product affordable and preferred. The seal was also change to one that could be easily opened and according to the customers needs. On the package, the company strategized in the usage of the products and the three benefits that come with it for example good breath, strong teeth and fighting germs at the pack indicated. This was to attract more customers and to educate the public on the usage of the product. Its marketing strategy currently aims at sensitizing on complete care that fights cavity thus helping to fight plague and whitening of teeth. According to Richard (2006) some of the marketing tools used by the Company in the early nineties included targeting the rural people who are so sensitive about the price of the product and not its quality. By this the manufacturers aimed at reducing their prices and to pack it in small packages where even the poor could afford. As the market had been dominated by the red toothpowders such as close-up, the marketing strategy of Colgate was to produce a white powder where the consumers would assume that that white color would make the teeth look whiter. It was studied that the significant changes of customers’ preferences especially in the Indian market lead to decline of Colgate’s market share. This is because the customers seemed to be more selective and that they easily changed their needs (Wilmshurst 2006). They were also capable of purchasing various products and were so much conscious on the quality of products. Singapore having an economy based on market for a product to achieve its competitive goals, the managers have to employ the best contemporary marketing tools as well as techniques. It is therefore important for the marketing managers to plan well their strategies if they are aiming at achieving more revenue out of their products. The first factor to consider involves setting up objectives that they wish to achieve in marketing. These objectives should be in a way that they are achievable, smart and those that could take a shorter time to attain effectiveness. The other factor needed is to determine the marketing strategies that will be implemented in order to attain the objectives proposed. The final step therefore involves determining the best plan to achieve both the strategies and the objectives. The first process in the process of marketing involves analyzing the company’s mission and vision. This helps the managers to act in a way that they aim at attaining the goals of the company. Some of the tools and techniques used in contemporary marketing include the five forces model and the SWOT analysis of the company’s internal and external influences. Peter (1999) describes that the internal influences involve strengths that make a company competitive and the weaknesses that lag a company behind. The Colgate Company used the above analysis where they identified their strengths as having staff members who were qualified. This is because the staffs were able to perform their duties in the right manner and work effectively to attain their targets. The other strength that make Colgate to survive in the Singapore market is having a strong financial backup where just incase of recession and the company runs at losses then it will be easy to get back to their financial position unlike other competitors who lack backup thus forced to exit the market. The other strength is the presence of the orange gel introduced in the market which gave maximum freshness all through the day. Most consumers were so attracted to this gel and so made more sales. There were also orange crystals that also provided cleanness, good taste and freshness where other oral products did not have this product thus drove more customers (Kotler and Armstrong 2003). A friendly working environment was another strength that the company enjoyed thus effective and efficient outcomes were seen. There are also major weaknesses that the company has for example the government policy of imposing a higher rate of taxation makes the company’s product increase in prices. Increased prices meant that customers based on prices would opt to buy substitutes that were at a lower cost. The other weakness is that their competitors for instance close-up and pepsodent sold at lower cost made low income customers go for them. The external influences include the threats from competition and the opportunities that a company enjoys from the external environment for example if a company is located where there are few competitors. Another opportunity enjoyed by the company is the large investment. Churchill and Peter (1995) shows that this is evident as the company had many retail stores around the area thus was in a position of gaining a large market share. Their intensive distribution also makes the company survive and increase on sales and profitability. The economic stability of the country has resulted to Colgate’s success thus growth and globalization where the company diversifies its risks. Globalization also makes the company survive in the market as there are few competitors. Technology is another opportunity that makes the company to stand out from the rest as work is made easier thus increased productivity and efficiency. The threats facing the company include aggressive competitors in the global market. Others include operating under political influence where the government set up higher taxes making the company increase on prices. The government also introduced higher targets for companies wishing to operate internationally which made the Colgate company strain to attain limits. Kotler et al. (2008, p. 7) shows that as products enter the market, it is important to determine how these forces would affect and how to deal with the effect. The Colgate Company positioned itself in a manner that the buyers the buyers demand was stable though their tastes and preferences changed over time. Richard and Gary (2005) shows that for the company to deal with the power of buyers they introduced toothpastes of different taste and color to meet the demand in the market. Colgate Company also improved their technology to a more integrated one in order to cater for the threats from new competitors. This is where the company organized promotions through the internet where it was able to reach more clients and the clients were to choose among the many products through reading each explanation (Dan 1997). Recommendations The changes that occur in the marketing strategy are aimed at improving the performance of a product in the market thus increases in profitability of the business. I would recommend that the marketing managers of Colgate to aim at profitability and not making more sales. This is to be achieved by including more advertising tools for example use of public relations where the promotion should focus on educating the public and especially those from the rural and remote areas. The advantages of using Colgate products should be compared with that of Colgate which is the main competitor and the strategy should be in a way that more people will want to try the product. The managers should also choose the right media to advertise and at what time. To determine this, the strategic planners should first know their target market. We find that in rural areas most people can not access the internet and so the use if internet services would be impossible. The right message ought to be discussed so as to avoid misleading the public. One example of this is where Colgate Company may plan to tell the public of how the product avoids decay of teeth yet it does not have fluoride that is used by its competitors. The advertisement should also be easy to understand to make people recall once they are making a purchase. The other recommended strategy for the company is to encourage global teamwork as this will strengthen the company’s growth due to diversification and increased supply chain management. According to Paul (1997) the marketing strategy should include the niche positioning strategy which mostly targeted those consumers who focused on the protection of the gum. This strategy is to make more sales on the Precision toothbrush and the Colgate herbal toothpaste which will be used as market niche. The other strategy includes the use of product differentiation which should aim at making the products unique from the rest. The plan will to change the whole package, the design and increase its prices so as to maximize profits and market share. Joshi (2005) described that the packaging used should be more appealing. Price and quality strategy should be introduced in order to offer products of a higher quality than the competitors. This strategy is to target a certain group of consumers who are quality sensitive. The company wishes to improve on innovation through integrating all the activities and processes. For this strategy to succeed the company ought to invest on more resources for example funds to cater for the development and also to ensure that the employees working on the system are professionally skilled. References Beacham, W et al. 2000, Beachams Marketing Reference, Account executive-market segmentation, vol. 2, Washington, D.C.: Research Publishing. Boone, E & Kurtz, D1998, Contemporary marketing, 7th ed. New York: Dryden/Harcourt Brace. Churchill, A & Peter, J 1995, Marketing, Creating value for customers, Boston: Irwin. Dan, S 1997, What kids buy and why, The psychology of marketing to kids. New York: Free Press. Farese, L Kimbrell, G & Woloszyk, C 2000, Marketing essentials, Mission Hills, CA: Glencoe/McGraw-Hill. Joshi, M 2005, International marketing, Oxford University Press, New Delhi and New York Kevin, J & Robert, S 1999, The marketing revolution, A radical manifesto for dominating the market place. New York: Harper Business. Kotler, P & Armstrong, G 2003, Marketing, An introduction, 3rd ed. Englewood Cliffs, NJ: Prentice-Hall. Kotler, P Gary, A Veronica, W & John, S 2008, Marketing defined,  Principles of marketing, 5th ed. p. 7. Paul, H 1997, Sales process engineering, A personal workshop, Milwaukee, p. 23. Peter, Z 1999, Wise up to teens: Insights into marketing and advertising to teenagers, 2d ed. N.Y, New Strategist Publications. Richard, J & Gary, J 2005, Principles of marketing, A global perspective, 2d ed. Cincinnati, OH: South-Western. Richard, S 2006, New and improved, The story of mass marketing in America. Boston: Harvard Business School Press. Stanley, J & John, K 2009, Back to first principles. International Marketing, Modern and classic papers, 1st ed. p. 25. Wilmshurst, J 2006, The fundamentals and practice of marketing, Comparative marketing Systems, Prentice Hall.  Read More