Colgate Toothpaste SWOT Analysis 2
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Transcript of Colgate Toothpaste SWOT Analysis 2
Colgate toothpaste SWOT AnalysisStrengths [list][*]Cost advantage[*]Effective communication[*]Loyal customers[*]Market share leadership[*]Strong brand equity[*]Strong financial position[*]Supply chain[*]Pricing[*]Reputation managementWeaknesses No online presence
Giant competitors like Close-Up and Pepsodent
Opportunities [list][*]Product and services expansion*IMPROVING ADVATISING *IMPLEMENTING NEW PRODUCTS MAJORLY TO ATTRACT YOUTH
Threats Competition
Lower cost competitors or imports
Maturing categories, products, or services
Price wars
1. Executive Summary The Colgate-Palmolive company is acknowledged as the world's leader in personal care. This
report analyse the Colgate's current situation in order to give recommendations on their actual
toothpaste product line.
The report is divided into two parts. The first parts will analysis the current situation of
Colgate. On the basis of a Swot analyse the strengths, weaknesses, opportunities, and threats
of the company as well as of Colgate's toothpaste product line will be analysed. Furthermore
additional information on the company's current market share, profitability, sales and the
external environment of Colgate within the scope of the PEST analysis will be presented. At
the end of the first part the competitive advantage of Colgate will be mentioned.
The second part includes a suggested marketing strategy of the author using marketing tools
such as segmentation targeting & positioning, SMART objectives as well as the marketing
mix. To better recommend improvements, the actual state of Colgate referring to their
products, objectives, etc. is in some parts shortly mentioned. At the end a conclusion is drawn
concerning the current situation of Colgate and suggested improvements for the future.
2. Introduction Colgate is the world market leader in oral hygiene products. The toothpaste product line
consists of strong brands. This is due to a very successful marketing strategy of the company
in the past. But especially in a competitive environment like the personal care industry it is
essential for Colgate that it upgrades its organisational as well as marketing strategies in order
to meet the customer's needs and strengthening the leadership. Furthermore nowadays a wide
range of different toothpaste products is offered to the customers. This in particular means for
Colgate that they must differentiate their products from the competitor's products by being
innovative and unique. Moreover the toothpaste market is growing constantly which means
that more different needs and expectations of the customer will arise. Therefore Colgate must
make use of marketing tools such as market segmentation to better identify their needs in
order to supply them with the right products.
3. Situational analysis The situational analysis attempts to address the question `where is the organization now?' The
situational analysis contains a vast amount of information and, as the term indicates, is an
analysis of the situation that you are facing with the proposed product or service (Hollensen,
S. (2003) Marketing Management: a relationship approach, p.652).
Page 6Alexander Berger -Marketing Strategy- - 2 -
3.1 Company analysis 3.1.1 Company profile Colgate, founded in 1806 by William Colgate, is acknowledged as the world's leader in
personal care sales including oral hygiene products such as toothbrushes and toothpastes.
Colgate has many subsidiary organisation located in more than 200 countries, but it is
publicly in only two, the United States and India.
3.1.2 Growth and profitability Global sales as reported were $15,327 million during the financial year ended December 2009
($15,330 million in 2008). The operating profit was $3,615 million during 2009, an increase
of 16.6% over 2008. At present, Colgate has a market share of 44, 4% in the world's
toothpaste market operating in more than 200 countries and territories. In the United States,
one of the world largest consumer markets, Colgate is the market leader in toothpaste sales
with a market share at 36.2 % (Colgate-Palmolive Annual Report 2009, p.2-4). Operating in
more than 200 countries the company is not depending on one single market. Significantly for
the global presence is that over 82% of the company's 2009 revenues came from outside the
United States. The markets in industrialised countries are largely saturated. Because of the
strong presence especially in emerging countries such as India and Brazil Colgate takes
advantage of the positive consumer trends in these countries and can compensate the sluggish
economic growth in industrialised countries. Please see appendix to find further financial
information on Colgate.
3.1.3 Culture Colgate's success is linked to its culture, which encourages all Colgate people to demonstrate
personal leadership every day. Personal leadership also include three fundamental global
values of the company: Caring, Continuous Improvement and Global Teamwork (Colgate-
Palmolive Annual Report 2009, p.19).
3.1.4 Goals The main goals of Colgate are to better understand consumers behaviour, launching new
products through innovation, increasing effectiveness and efficiency as well as strengthening
the leadership worldwide (Colgate-Palmolive Annual Report 2009, p.4).
Page 7Alexander Berger -Marketing Strategy- - 3 -
3.1.5 Collaborators Colgate is working closely with thousands of small shop owners and local wholesalers to
ensure greater availability to their products as well as to provide the right assortment of
products with best visibility in each store. To built credibility among the consumers Colgate
cooperates also with dental professionals.
3.1.6 Customer The selling of Colgate's products depends on chain reactions. If there is a growing population
rate worldwide or in local markets, the need for oral hygiene products increases. Today the
world population is approximately 6.85 Billion, predicting a world with 9.2 people by mid-
century. Because of the globally presence of Colgate, there will be 2.35 billion new potential
customers until 2050 (United Nations world population prospects 2008). Here is to point out
that the average age of the population is not essential because all people have a need for oral
hygiene products. Furthermore Colgate offers premium products which mean the consumer is
willing to pay a high price for the product in order to receive high quality products.
3.1.7 Competitors The main competitors are Unilever, Procter & Gamble and the Clorox Company. The
personal care industry is mostly controlled by these companies. On the one hand in order to
gain more market share within this industry, the only way is to take it away from one of these
competitors. On the other hand Colgate must also be aware of losing market shares to their
competitors. Please see Appendix to find a financial comparison of Colgate-Palmolive's
competitors.