No Marshmallows, Just Term Papers
In August 1992, Colgate-Palmolive (CP) plans to launch a new toothbrush named Colgate Precision which is a super-premium toothbrush, but faced a difficult task of positioning its brand in highly competitive market.
In the U.S. toothbrush market, the toothbrush industry was grown very quickly. New product launches had increased and performance benefits had become increasingly important purchase criteria. Consumers took more interest in the category and increased their purchase frequency. However, it may reduce the sales after 1993, because of free brushes through dentists and “two-for-one” consumer promotions.
Colgate-Palmolive Company segments the toothbrush category into three groups which are super-premium, professional, and value brushes. Competition in the super-premium is fierce. There are four major products in the Super-Premium toothbrush which are Oral-B Indicator, Reach Advanced, Crest Complete, and Aquafresh Flex.
The Colgate-Palmolive is willing to target its new product into super-premium brushes, and the main issue is to position its product either in niche product or mainstream brush. Niche market will give CP an opportunity to set a higher price, target 67% involved oral health consumers, and reduce the cannibalization of existing product, but it will face high standard competition, and low market shares than mainstream market. On the other hand, Mainstream market will have larger market shares. However, CP may not have capability to manufacture enough new product and has opposite influence for others Colgate’ product. As a result, through positioning into niche product has more benefit than mainstream, I strongly recommend that the Colgate-Palmolive should position Precision toothbrush into niche market. For the Branding, the new product could call Precision by Colgate that cannibalization figures for Colgate Plus. Also, CP could address that the Precision prevent gum disease for their promotion to gain most customers who...