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Project1- Pricing Strategies Colgate Palmolive 360 Precision Toothbrush

Created By: Hariprasad MohanRoll No: 1303012

Table of Contents

1.1INDUSTRY SNAPSHOT:31.2About Colgate Palmolive India Limited:31.3Company Strategy Oral Care and Tooth Brush Industry In particular41.4Colgate Palmolive Product Mix41.54P Analysis (Product, Price, Place and Promotion)51.5.1PRODUCT:51.5.2PROMOTION:71.5.3PLACE:91.5.4PRICING:101.5.4.1Colgate 360 Pro Relief:111.5.4.2Colgate Sensitive Toothbrush:111.5.4.3Colgate Kids 2+:111.6Competitors:121.7Competitors Product Pricing:121.7.1Oral-B:121.7.1.1Oral B Advantage Sensitive Extra Soft Toothbrush:121.7.1.2Oral-B Cross Action Pro-Health:131.7.1.3Oral B Cross action 7 Benefits Toothbrush:131.7.2Pepsodent:131.7.2.1Pepsodent Germi Check Whitening:131.7.2.2Pepsodent Gremi Check Complete Clean Soft:131.7.2.3Pepsodent Gum Care Toothbrush:131.7.3Sensodyne:141.7.3.1Sensodyne Ultra Sensitive Extra Soft:141.7.3.2Sensodyne Gum Care Toothbrush:141.7.4Crest:141.7.4.1Crest Extra Cleaning Medium Toothbrush:141.7.5Closeup:141.7.5.1Close-Up Style Single:141.7.6Sources:15

INDUSTRY SNAPSHOT:

India is one of the fastest growing economies in the world. While we are moving towards becoming a services-led economy but still agriculture contributes around 17 per cent of the total GDP and employs 60 per cent of the population. India's FMCG Industry is the fourth largest sector in the economy and creates employment for more than three million people in downstream activities. It is one of the most important sectors for each and every economy. It plays a vital role being a necessity and inelastic product which touches every life in one or the other aspect. Its principal constituents are

Household CarePersonal Care andFood & Beverages.

The total FMCG market is in excess of INR 85,000 Crore. It is currently growing at double digit growth rate and is expected to maintain a high growth rate. FMCG Industry is characterized by a well established distribution net-work, low penetration levels, low operating cost, lower per capita consumption and intense competition between the organized and unorganized segments. The Indian FMCG industry is known for the presence of global players through their subsidiaries like

Hindustan Unilever Limited. Procter & Gamble. Nestle. Colgate Palmolive

This ensures new and enhanced product launches in the Indian market from the parent's portfolio. The company leverage the benefits by known brands clubbed with easily availability of key raw materials, cheap labour gives it a competitive advantage. Oral Care contributes around 5 per cent of the total FGCG market in India. It includes

Toothpaste Toothpowder Toothbrush as it major constituent.

Oral care segment is among the few sectors which still have lot of growth potential. It has registered a double digit growth rate over the past few years. According to CRISIL anticipation, FMCG sector could touch around INR 140,000 Crore by 2015.

About Colgate Palmolive India Limited:

A household name for paste and tooth powder, Colgate Palmolive (India) was established on 23rd September 1937 as a private limited company in Bombay, as a wholly owned subsidiary of Colgate Palmolive Co. Of USA. Initially it started with trading activity and later set up manufacturing operations in 1949 at Sewri (Bombay). The company became a public limited company on 5th October 1978. In 1990-91 the company commissioned facilities for fatty acid and toilet soap at Walunj (Aurangabad). The plants at Sewari and Walunj manufacture oral care products like dental creams, tooth powder, tooth brushes and personal care products like toilet soaps, shampoo which is marketed under various brand names such as Colgate, Palmolive, Halo, Protex and Charmis.

Colgate Palmolive (CPIL) is the largest player in oral the care segment in India with a market share (June, 2014) of 57% in toothpaste and 42.6% in toothbrush category. In spite of Procter & Gambles (P&G) re-entry into the toothpaste segment in India in June, 2013 (brand: Oral B), CPILs market share has only strengthened. CPIL has increased its market share in toothpaste from 54.7% in June, 2012 to 57.1% in April, 2014. Similarly, the market share in toothbrush has also increased from 38.7% to 42.3% for the same period. The second largest player in the toothpaste category, Hindustan Unilever Limited, is losing its market share with Dabur India inching share from ~10% to ~11% in the last two years. Further, regional players like Vicco, Ajanta, Anchor, Smyle and Baidyanath have also witnessed a loss in market share in toothpastes. The combined share of all these regional brands has slipped to ~2% (2013) from more than 5% two years ago and ~15% share 10 years back.

Company Strategy Oral Care and Tooth Brush Industry In particular

Company strategy - oral care and toothbrush industry in particular Volume is the key says Richard Usuquen, VP Marketing Colgate Palmolive (India) Ltd. to expand the market in all ranges.

CP has an ongoing RURAL VAN PROGRAMME and SCHOOL PROGRAMME covering 14 million villages and 80 million consumers; teaching people to brush or even clean their teeth with the fingers. CPs action is centering on finely balancing the urban market (59.5%) and rural markets (68%). So while the company has introduced such premium packaging as stand up toothpaste tubes with flip-up caps in the urban market, it is also selling sachets of Colgate dental cream at low prices.

BUSINESS SEGMENT The company broad product segment includes Oral Care, Personal Care and Household Care. Further the Oral Care portfolio includes Toothpaste & toothpowder and toothbrush.

Oral Care : The size of Indian Oral care industry is expected at around INR 4,000 crore, where it is segmented into

Toothpaste (60%). Toothpowder (23%). Toothbrushes (17%).

Colgate Palmolive Product Mix

4P Analysis (Product, Price, Place and Promotion)

PRODUCT:

Product is anything that can be offered to a market for attention, acquisition, use or consumption that might satisfy a need or want.

Product Positioning:

Precision was developed with objective of creating the best brush possible and as such, becoming a top of the range, super premium product. Niche Product targeted @ consumers concerned with gum disease. 15% price premium over Oral-B. Positioned as mainstream brush with broader appeal of being the most effective brush available in the market

Positioned as a New High-Performance Manual Toothbrush

A next-generation high-performance toothbrush designed to go beyond cleaning teeth to cleaning the whole mouth,

Colgate 360 is clinically proven to:

Reduce up to 40% more interproximal plaque Reduce up to 72% more gingival bleeding Remove up to 96% more odor-causing bacteria Desquamate bacteria-harboring epithelial cells from buccal mucosa Reduce oral malodor over 3 times better than the leading manual and battery-powered toothbrushes Provide up to 10 hours of long-lasting fresher breath

PROMOTION:

The discussion of marketing mix elements cannot be complete without analyzing the promotional strategy of the company. In a low investment category, where there is hardly any individual who can call himself brand loyal and most of them happy with whatever toothbrush they can lay their hands on, without caring too much about price, a marketing effort to ensure an optimum push and pull combination and an impact presence in the consumers mental frame is a must.

1. Oral Health Month Program2. Partnering with Professionals (Dentists)3. Engaging the Shopper4. Keep India Smiling Program5. Health Melas.

The idea behind Oral Health Month Program are as follows,

Awareness Generation:

Media Public Relations Trade Activities On pack Messages

Oral Hygiene awareness activities

School contact Program Shopper Engagement PROGRAM ITC E-Choupal School contact program

Public Dental Checkups

In Clinic Mobile Vans Factory Checkups School Dental Health Checkups

PLACE:

The decisions regarding distribution channels are a very crucial part of the marketing of Fast Moving Consumer Goods (FMCGs) more so because of tooth brush being a low price product with negligible brand loyalty, no Consumer would be willing to walk more than 2 km to procure a tooth brush and would accept, without much hesitation, any toothbrush thrust upon him by the shopkeeper. So the markets has to make extra efforts to ensure easy availability of this low involvement product, which is no easy task in a country of the size & diversity as that of India.

Channel decisions have important implications for other elements in marketing mix. Colgate Palmolive had to design a distribution strategy which would best attain following channel objectives.

Achievement of greatest possible coverage of the target market. Ensuring that the consumer can easily procure the toothbrush (Under no conditions stock out can be allowed.) Maintaining mutually beneficial relationship with the retailers since tooth brush is basically push marketed.

PRICING:

Generally the most important of all the PS in a developing country like India where semi-urban and rural population constitutes, a massive portion of the total market, has to be decided upon after contemplating on all the aspects related to the market and the product itself.

For a product like toothbrush, the major cost is that of packaging (about 40% of total), the rest being spread over the bristles, the nickel silver wire holding the tufts in place and on the body of the brush.

Colgate 360 Pro Relief:

This toothbrush was introduced for those end users to solve the problem of dentine hypersensitivity. This toothbrush was designed for sensitive teeth and gums. It helps to cleanse the whole mouth in order to fight plaque and bacteria without any tooth pain. This brush is equipped with soft textured bristles, unique shaped head, for steady and controlled movements in brushing the teeth and also effectively fighting plaque.

This toothbrush helps to reach the difficult places in between your teeth and remove all the food particles which can create bacteria, bad gums. Its softness helps in gentle movement on the teeth and keep healthier teeth. The handle of the toothbrush provides comfort in holding them as well as its neck makes every brushing a remarkable experience. The price of Colgate 360 Pro-Relief Toothbrush is Rs 62.Colgate Sensitive Toothbrush:

This toothbrush helps to effectively fight plaque by gentle massaging your gums. This toothbrush is enriched with special super soft bristles that help to brush your teeth and gums gently. The specially designed handle of the toothbrush helps to provide a thorough and comfortable hold while brushing your teeth. This toothbrush also ensures that your mouth is cavity free and also free from sensitivity of teeth.

This product of toothbrush ensures that the end users are comfortable and are free from any pain and show up with their smile while brushing the teeth. This toothbrush ensures a complete care of your mouth. The price of Colgate Sensitive Toothbrush is Rs 58-Rs 65 (Saver Pack).Colgate Kids 2+:

This toothbrush is specially designed for young children ageing 2 year and above. This toothbrush ensures proper and intensive care for child's growing teeth. This toothbrush is very soft and comfortable for every young child to use without any tooth problem. These brushes are available in different colours making every child to brush the teeth with sweet smile on face. The soft and gentle bristles help to brush gentle on the teeth and gums. The price of Colgate Kids 2+ Gentle Soft Toothbrush is Rs 14-Rs 17.

Competitors:

ProductManufacturerFeatureBenefitReasonTagline

Oral-B indicatorGilleteIndicator BristlesTells you when to change your toothbrushBlue Band fades halfway.Dental HeritageThe brand most dentist use

Aquafresh FlexGSKPressure sensitive, Flexible neck linking brush and handlePrevents Gum IrritationFlexes as you brushFor gentle dental care.

Reach AdvancedJohnson & JohsnonAngled Neck,Raised rubber ridge on handleCleanes even the hardest reachest placeSlimmed downtappered headFeel the difference

Crest CompleteP&GRippled bristle design, Handlewith rubber gripReaches between teethlike a dental toolRippled end round bristles.Only crest could make a brush this complete

SensodyneGSKdaily clean and brush of sensitive teeth.gentle on sensitive teeth and gumseffective cleaning even the hard to clean areas. No#1 Denstist recommendedtoothpaste and brush

Close upHULDuPont Tynex bristles that work wonders on your teeth and gums. will reach every angle while brushing with a comfortable gripDupont Bristles.Number 1 recommended by dentists.

Competitors Product Pricing:

Oral-B:

Oral-B is a brand of oral care product of Procter & Gamble. Oral-B refers to Oral-Brush which ensures to prevent cavities, plaque, tartar and gum problems during brushing your teeth with toothpaste. Oral-B is called as No.1 product in oral care sector of P&G.

Oral B Advantage Sensitive Extra Soft Toothbrush:

Oral B Advantage Sensitive extra soft toothbrush helps in removing stains on the teeth and protects teeth from whiteness. It helps in vanishing the germs while brushing and protect you to get good feeling and freshness in your mouth by complete end to plague, and other bad gums. Its bristles are protected with antibacterial formula which helps in keeping your brush clean, fresh and hygienic. This brush is enriched with precast tongue cleaner which helps to clean the germs located on your tongue and bring fresh breath. This brush overall helps to reduce plague, gingivitis, and by doing so, it also helps to improve gum health and offers better clean up and freshens good breath. The price of this toothbrush is Rs 30.

Oral-B Cross Action Pro-Health:

This toothbrush comes in two variants which are medium and soft, and all these two variants are recommended for keeping healthy and strong teeth. This toothbrush helps to reach the hardest place in between your teeth and removes all the leftover food particles which can create bacteria, bad gums and plaque. This toothbrush is very gentle on teeth and gums and cleans tongue and prevents bad breath. The price of this toothbrush is Rs 110 (2+1 offer pack).

Oral B Cross action 7 Benefits Toothbrush:

This toothbrush helps in attacking germs and plaque from different angle which helps in effective brushing of teeth. This toothbrush helps to removes the germs on your tongue. Its bristles help in removing the germs and plaque upto 99.99% and also reduce the gingivitis which helps in improving the gum health. It totally removes the germs which create odor in the mouth and bring complete solution to teeth health. The price of pack of 2 is Rs 100-Rs 110.

Pepsodent:

Pepsodent is manufactured by Hindustan Unilever Limited (HUL) and its toothbrushes are regarded as No.1 for giving best solution to tooth problem while preventing germs, plaque, cavities and bad breath.

Pepsodent Germi Check Whitening:

This toothbrush helps to bring effective care to the tooth and ensuring there is complete end to plaque, cavities, and bad gums. Pepsodent Germi check whitening toothbrush helps in removing stains on the teeth and protects teeth from whiteness. Its bristles help in vanishing the germs and cavities and brings good breath. The price of this toothbrush is Rs 51.

Pepsodent Gremi Check Complete Clean Soft:

This toothbrush ensures complete check while brushing the teeth while removing the stains and bad cavities in the teeth. Its bristles help in complete end to germs and plaque. The price of this toothbrush is Rs 23.

Pepsodent Gum Care Toothbrush:

This toothbrush is designed specially to kill germs and plaque. Its clustered bristles help to clean every corner of the teeth effectively and keep gum free. This toothbrush is very soft and will not cause any damage to the tooth enamel or gums. This toothbrush gives best solution to bleeding gums and sensitive teeth. The price of this toothbrush is Rs 35.

Sensodyne:

Sensodyne is the best brand for toothbrush, toothpaste and mouthwash with its registered trademark of GlaxoSmithKline. Their toothbrushes are famous in the market and helps in protecting thorough control of bad gums, cavities and plague.

Sensodyne Ultra Sensitive Extra Soft:

This type of toothbrush is introduced for sensitive teeth and is an extra soft toothbrush. It is enriched with soft rounded bristles which are very gentle on sensitive teeth. Its slim design of the toothbrush is very easy to access to different and all areas of the mouth and keep your mouth fresh and odour free. The price of this toothbrush is Rs 45-Rs 50.

Sensodyne Gum Care Toothbrush:

This toothbrush is enriched with gum massager and is designed specially for sensitive teeth and soft gums. This toothbrush is designed in such a way that it can reach many difficult and awkward areas very easily and clean the bad gums. Its anti-gliding handle enables comfortable grip while brushing your teeth. The price of this toothbrush is Rs 50-Rs 55.

Crest:

Crest toothpaste is the oral care product of Procter & Gamble (P&G). Their toothbrushes are overall famous in Indian Market and are reasonable. This kind of toothbrush protects from germs and cavities and keeps teeth stronger and healthy.

Crest Extra Cleaning Medium Toothbrush:

This toothbrush helps in cleaning the teeth thoroughly even between the teeth. It's long lasting dark green bristles helps in reaching every corner of the teeth effectively and keep gum free. This toothbrush removes the stains on the teeth and keeps teeth white and odor free. This toothbrush is available in many parts of India, and is very reasonable. The price of this toothbrush is Rs 40-70.

Closeup:

Close up is the market leader of Hindustan Unilever Limited (HUL) and all the consumers like this brand of toothpaste and toothbrush. Its toothbrush helps to completely remove the stains on the teeth and keep your teeth free from bad gums and cavities.

Close-Up Style Single:

This toothbrush consists of rubber massage bristles and tongue scraper which helps in effective cleaning of teeth and gums. Its handle is made up of soft rubber and plastic with an easy grip to handle them during brushing. This toothbrush cleans every corner of the mouth and cleans the food particles and keeps mouth with odor free. It helps in improving gum health while brushing the teeth. The price of this toothbrush is Rs 45-Rs 60.Sources:

Colgate Palmolive Analyst Presentation 2011 Colgate Palmolive Analyst Presentation 2008. AC Neilsen Consumer Survey.