Colgate Max Fresh: Global Brand Roll-Out
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Colgate Max Fresh: Global Brand Roll-Out
Situational Analysis
Colgate Palmolive is a $10.6 billion global company operating in 200 countries worldwide. The company focused on two core product segments – Oral, Personal and Home Care and Pet Nutrition. Colgate is worlds leading toothpaste and toothbrush brand while Palmolive is the third largest soap brand.
CP enjoyed a strong year in 2004 as it reported high volume growth and sales dollar growth. As it is the market leader, it has to focus on high profit making products to drive profit as it incurs huge marketing expenses and rising raw materials prices & packaging material cost. They also concentrating on high potential markets like US, China, Russia, India, Mexico and Brazil.
Organisational structure of CP was organised along geographic lines with management teams responsible for the financial results of their respective regions. Marketing or product idea of any geographic region was done at Consumer Innovation Centres located in different local regions. Go to market team in each CP country takes their decisions related to launch planning and execution.
There are two core categories of toothpaste: Therapeutic and Cosmetic. CP launched Colgate Total to compete with Crest which used to be the market leader in therapeutic market. CP soon became the leading US toothpaste brand. In 2002, with the intention to create a point of differentiation, they R&D team came up with a product which utilized its patented technology of dissolvable mini breadth strips – Colgate Max Fresh.
Problem Definition
CMK was positioned as a premium product. Launching the product in US was easier than launching the same in emerging markets as people were aware of concept of breath strips and the higher manufacturing cost incurred could be easily passed on to the consumers as the people in developed country were not so price sensitive. As there was a clear difference in how consumer perceive the product, the campaign used in US couldnt be extended to the emerging markets. With an aim of localising the product, company invested millions to dollar to conduct various flavour trials, test campaign etc. Different SKUs of products were adopted in local market to attract the price sensitive customers.
The company was well aware of the fact that launching a premium product like CMF in emerging markets will involve huge marketing and advertising cost. But the company had decided to have a global launch of the product to achieve upselling of its product at the cost of some cannibalisation of the existing product. P&G was also coming up with various premium range product to upgrade their customer. CMK was aimed to compete with various Crest product. To address everything, cost-optimised, locally-driven marketing strategy was adopted for emerging countries