Colgate Total Toothpaste - Assessment of the Products Success as a Solution to the Target Consumers Needs - Example

Colgate Total Toothpaste Name: Tutor: Course: Date: Table of Contents Table of Contents 2 1. The Australian target market 3 2. The Marketing Mix 3 2.1. The Product 3 2.2 Promotion 4 2.4. Price 5 3. Competitive Advantage 6 4 Assessment of the product’s success as a solution to the target consumers’ needs 6 Reference List 7 Colgate Bulletin 2013, Colgate Total Whitening Gel Toothpaste, 7.8 oz, Pack of 6, New York. 7 APPENDIX 8 1. The Australian target market Colgate toothpaste market encompasses all the consumers from health institutions to individuals in Australia. The health institutions are specifically dentist units while individuals include people of ages three onwards of all social and economic classes. The market segments are defined by quality and price with higher market segments buying the premier Colgate products (ADA Council 2013). The segment is wide with various sizes of similar qualities to meet each customer purchasing decisions. Colgate customers in Australia require toothpaste that is innovative, effective and appealing. The market is selective especially with regard to use in keeping good oral hygiene conditions rather than taste and smell. People need the toothpaste to clean their teeth and prevent dental caries and periodontal diseases. They also need to be productive both at school and work. Hence, they need to brush their teeth at least three or four times a day after meals. The Colgate market profile involves targeting people of all races and marital status, at least three years of age, from kindergarten classes onwards, all social and economic grouping (Colgate Bulletin 2013. Those targeted mostly are parents, educational and health institutions since they have immense influence on those around them. Both male and female persons use the product. 2. The Marketing Mix 2.1. The Product Colgate Total toothpaste is the product of Colgate-Palmolive Group from the United States made of Sodium Fluoride Mint, Cellulose Gum, Flavour, Red Seaweed. The product is packed in tubes of various sizes depending on quantity and price. Recent innovative products have seen increased use of herbal ingredients and mint which is mainly used by the young population of between 20 and 35 years. The product is applied on a toothbrush and used to clean human teeth. The product falls in the personal care category (Beath & Katsoulacos 2001). Colgate Total toothpaste is a single product among alongside other brands such Optic White, Sensitive Pro-Relief, Luminous, Max Fresh, Triple Action among others. The pack sizes are 7.8 Ounces tubes with a pack of 4 and 6. It comes in three flavours are Clean mint, Whitening and Mint Stripe The product has a great mint that is tasty and leaves ones mouth fresh and clean. It whitens the users’ teeth by removing gently the surface stains. It also has a mint blend of paste and gel for a fresh mouth. The mouth wash is relieving especially when facing a aching or foul mouth. Colgate Total Toothpaste has revolutionalized the thinking of the youthful population who admire freshness and sparkling white teeth at their places of work (Canzer 2009). Colgate Total is a convenience product since it is readily available and used by a broad range of consumers of all ages, gender and geography. This product was chosen since it was lower in terms of risk and effort. The customers will spend less time and money to purchase with lower significance of risk from easily accessible stores. The unit price is also small such that the customer will not travel far to incur for a special brand. The product is less costly and readily available from supermarkets, stores and retail outlets selling household products. The come in sizes packed in 4 and 6 in 7.8 tubes. The product has fresh tasty mint that suits young generation. It whitens teeth and removes surface stains. The Colgate fluoride is the core product since it does the whitening and removal of foul smell. The actual product is the gel or paste that does the freshening and oral cleaning of the teeth. The augmented is the mint and the toothbrush used to apply the paste on the teeth. Colgate Total Toothpaste is a strong and effective brand since it appeals to majority of the consumers in the global market (Economic Times, 2007). Many customers going on shopping prefer Colgate brand since is innovative and cost effective. The quality is worth the price and is a household name. Customers have been made to believe that Colgate is Toothpaste and vice versa. The toothpaste is packed in 7.8 ounce tubes with packages of 4 and 6. They come in paper block packages holding the tubes. They come in a mix of blue and red colours. The packaging is convenient as users open the paper flaps and access the plastic tubes. The tube loosely fits the walls of the paper pack. The procurement department of Colgate is charged with purchase of plastic tubes that meet customer expectations. The packaging product is tough and resistant to wet or damp conditions (Griffin 2007). The product is differentiated from the other sets of Colgate products since it has mint and offers 12 hour freshness. The 4 and 6 pack is to allow for customers with varied social and economic classes to purchase and take pride in the brand. Colgate Total toothpaste is in the maturity stage since the company is set to maintain the market share owing to various challenges like decreasing profits, market share and a peak in sales volumes. Colgate is at this moment experiencing continued reduction in costs and increased market share by way of differentiation. 2.2 Promotion Colgate Total finds effectiveness in advertising through various media and function. The common are A-List Awards website which lists all the brands to be advertised. The ad running around Australia in 2013 was the Clever Colgate Dental Floss which promoted easy access for disable people and those taking flights to the US. The company collaborated with Johnson’s baby in 2012 to propagate the numerous works of this toothpaste (Hill & Jones 2012). Colgate Fluorigard was also advertised as Mrs. Marsh Chalk on CBN and ABC stations in 2007 to 2010. These stations are traditionally watched by millions of Australians and are strategic to meet the needs of a growing company. Amazon.com also advertises the product with various cast on prices, quality and quantities accessed by many online customers who prefer shopping online and making purchase through this channel. The company utilizes print, oral and electronic modes of communicating to its customers. The print media is mainly through Herald Sun and the West Australian to reach many of its customers in offices and educational institutions (Hitt, Ireland & Hoskisson 2006). Personal communication is through a customer care centre in Perth, Sydney and Canberra answers queries and complaints from online and visiting customers. The use of mobile telephones has increased the effectiveness of Colgate distribution system since fax, emails and mobile phones have increased the request for orders in the case of retail stores and individual customers. The company has a website www.colgate.com that posts a list of its oral care products, special offers, employment opportunities and contacts. The website is mainly to provide awareness on new products and their prices and related information. Colgate advertises through Colgate Plax Australia with twitter handle (@ColgateSmile available in https://twitter.com/ColgateSmile‎ which celebrates special moments of users life. Colgate is available on Facebook with more than 2907200 likes while more than 9300 are talking about it. The information on Facebook is available in https://www.facebook.com/Colgate‎. Communication is important in advancing the attributes of the products to existing and potential customers (Lamb et al 2008). The means and mode of communication like mobile phones and emails help in ensuring demand meets supply of the product in good time. The price is posted in the site which offers the customer a decision to buy at an opportune time. Promotion of Colgate through price and added product features increases demand for the product. 2.3 Place (Distribution). Colgate employs both business to business distribution as well as business to customer distribution. It maximizes intensive distribution or complete market coverage. The distributor Colgate-Palmolive is attributed to producers of raw materials, single regional distributer and producer of the Australian region. They maximize efficiency since distribution for industrial products comes before that of consumer products. The company collaborates with Magellan Transport Logistics to reach global customers (Porter 2006). Common inland transport are trucks since they are available in all areas of Australia, no water to go over and goes to all members of Colgate Palmolive distribution channel. The distribution strategy was chose one distributor that ships to all continents since the product is non-perishable and can take time being transported at sea and land (Porter 2008). The firm distributes its products through stores and supermarkets because they are convenience products that are physically picked by customers. Online marketing is only used to create awareness and sensitization on creative and innovative nature of the product. The company distributes its products to various supermarkets and retail shops such as; Coles Express, Aldi, Woolworths, Supabarnn Supermarkets, and Five Star Braddon Supermarkets. These five entities are large outlets with more than 2000 customers visiting and shopping per day. They also have customer care centers to respond to customer issues. Customers in these outlets engage in self-collection and see for themselves the various brands and sizes of Colgate products. The distribution strategy of using a single distributor is appropriate for Colgate product at the maturity stage. 2.4. Price The prices of Colgate Total toothpaste as sold in various Canberra outlets were as follows; Coles Express ( Toothpaste Total 45g $1.8, Total Whitening $ 4.95, Total Plus $ 5.02) Aldi ( Toothpaste Total 45g $1.75, Total Whitening $ 4.65, Total Plus $ 5.22), Woolworths ( Toothpaste Total 45g $2.0, Total Whitening $ 4.8, Total Plus $ 5.00), Supabarnn Supermarkets ( Toothpaste Total 45g $1.9, Total Whitening $ 4.99, Total Plus $ 4.99), and Five Star Braddon Supermarkets ( Toothpaste Total 45g $1.75, Total Whitening $ 5.00, Total Plus $ 4.75). The differences in prices from the stores are attributed to price elasticity and price cuts to increase sales from the outlets. The differences in prices of the three brands are based on quality and quantity since Total Plus is regarded as more effective than just Total paste sold in 45g tubes. The advanced formula of Total are highly priced at $11.95 range in most of the outlets. The original product was going at $1.45 before innovation. The increase in rice is attributed to increased cost of innovation and creativity (Singh 2008). The price tactics used are mainly price cuts and bundle pricing. In the case of price cuts, the outlets reduces for instance Total Plus from $5.00 to $ 4.85 so as to increase sales by 5000 units per month or sell a combined Toothbrush and Total Plus for $6.75 which can be seen as low and convenient. The pricing strategy is based on economy pricing as a no-frills on the prices. The margins are thin with low marketing and advertising overheads to target the mass market and win a higher market share. The product pricing strategy is consistent with its maturity stage since the company is now spending less on advertising and marketing costs (Smith & Flanagan 2006). Customers are well aware of the product and the company gains well from personal sales. The product has lower production and distribution costs since it is not perishable requiring no refrigeration costs. It is a mass market product and is destined for all markets globally. 3. Competitive Advantage The product is attractive and smells good which appeals to many customers around the world. The packaging ounces tubes of 45g and 90g are convenient for family and individual use. The paste does not discolour clothes of the user and is available in all outlets at customers’ convenience. The product is differentiated from the rest of the brands to provide a new flavour of herbal mint characteristic of river plants (Smith & Flanagan 2006). The price is average to most of the low and middle income segments of the population. The average price of Total toothpaste is $2.00 which is 1% of the income accruing to the lowest income segment. The product is differentiated by adding Gum defense and whiteners to suit the health segment. The product is both used in personal care and treatment to decaying teeth since it reduces 90% of plague problems leading to tooth decay. The company continuously looks for innovative ways like developing the Colgate Total Advanced to ease competition from Macleans and Aim. These competitors are also supplying their toothpaste at slightly lower prices of average $0.4. Colgate has dominated the market owing to its pioneer status. Its products have been tested and recognized by global consumers. The company has heavily invested in research and development which sees them provide a winning product regularly. These have seen the company develop competitive products such as Colgate Total Advanced and Total solution. The effort has been to meet the changing customer needs and expectations. Wining a competitive edge for Colgate also means upholding organizational ethics and building on long-term goals. 4 Assessment of the product’s success as a solution to the target consumers’ needs Colgate-Palmolive is very successful in launching a highly differentiated product which is cost effective, has all the ingredients required for whitening, freshness, and treating decaying teeth. The distribution channel of using a single distributor is good to obtain a good negotiation platform and ensure that quality is upheld by the distributer (Steinhardt 2010). The consumers have been able to get a product at a minimum price which is negligible to their disposable income. The product is also used in oral treatment of teeth besides offering a good breath and striking white teeth. Consumers of all ages and gender are able to benefit from the product which is regarded as a must for personal care and hygiene. The Colgate Company continuously evaluates and assesses the market dynamics especially regarding the innovations and creativity of competitor products. The value addition to the toothpaste product has increased confidence and trust from the customers. Besides, the mode of advertising and promotion are supported by the ministry of health and international health agencies for cleaner teeth (Stead & Stead 2013). The Australian TV channels, radio and online sites are accessed by millions of Australians which makes Colgate to become a leader in personal care product distribution. The channels ensure products reach all the outlets marked in the entire global geography. Colgate is now a household name, with its brands associated with low price, high quality and readily available. Almost all the sizes and qualities are available at all times in major outlets and shops. These products easily sell when they are introduced to the market because customers identify their innovativeness and creativity. Reference List ADA Council 2013, Acceptance of Colgate Total (R) Toothpaste, Sydney Beath, J & Katsoulacos, Y 2001, The Economic Theory of Product Differentiation. Cambridge Univesrity Press. Canzer B 2009, E-Business: Strategic Thinking and Practice. Cengage Learning. Colgate Bulletin 2013, Colgate Total Whitening Gel Toothpaste, 7.8 oz, Pack of 6, New York. Economic Times, 2007, Pricing Strategy, The Economic Times, Washington. Griffin R W 2007, Fundamentals of Management, Cengage Learning. Hill C W & Jones G R 2012, Strategic Management: An Integrated Approach, 10th ed.: An Integrated Approach. Cengage Learning. Hitt M A Ireland R D & Hoskisson R E 2006, Strategic Management: Competitiveness and Globalization. Cengage Learning. Lamb C W et al 2008, Marketing, Cengage Learning. Porter M E 2006, Inter-brand Choice, Strategy, and Bilateral Market Power. Harvard University Press. Porter M E 2008, Competitive Advantage: Creating and Sustaining Superior Performance. Simon and Schuster. Singh M 2008, Strategic Management and Competitive Advantage, Global India Publications. Smith J L & Flanagan W G 2006, Creating Competitive Advantage: Give Customers a Reason to Choose You Over Your Competitors. Crown Publishing Group. Stead J G & Stead W E 2013, Sustainable Strategic Management. M.E. Sharpe. Steinhardt G 2010, The Product Manager's Toolkit: Methodologies, Processes and Tasks in High-Tech Product Management. Springer. APPENDIX Records of Fieldwork and Research Product under review: Colgate Total toothpaste Location: Canberra, Australia Date: 30th Dec 2013 Product Types of Total Colgate Brands: Toothpaste Total, Total Whitening, and Total Plus Ingredients: Sodium Fluoride, Mint, Cellulose Gum, Flavour, Red Seaweed Benefits: Helps in cavity, gingivitis and plaque prevention Pricing Outlet Toothpaste Total 45g ($) Total Whitening ($) Total Plus ($) Coles Express 1.8 4.95 5.02 Aldi 1.75 4.65 5.22 Woolworths 2.00 4.80 5.00 Supabarnn Supermarkets 1.9 5.00 4.75 Five Star Braddon Supermarkets 1.75 5.00 4.75 Promotion Advertising channels: ABC and CNB, available online through www.colgate.com Promotion methods: Price cuts and bundle sales Outlet Toothpaste Total 45g ($) Total Whitening ($) Total Plus ($) Coles Express ABC/ bundle sales ABC/ bundle sales CBN/ bundle sales Aldi ABC/ price cuts CBN/ bundle sales CBN/ bundle sales Woolworths ABC/ bundle sales ABC/ price cuts ABC/ price cuts Supabarnn Supermarkets CBN/ bundle sales ABC/ bundle sales ABC/ price cuts Five Star Braddon Supermarkets ABC/ bundle sales ABC/ bundle sales CBN/ price cuts Place/Distribution What is the distribution channel used by Colgate? The company uses Magellan Transport Logistics and inland trucks to reach millions of its mass market customers. Read More