Colgate

1157 WordsNov 18, 20135 Pages
You probably know about Colgate toothpaste – perhaps you’ve even used it. But what would you think of Colgate aspirin or Colgate antacid? How about Colgate laxative or Colgate dandruff shampoo? That’s exactly what Colgate-Palmolive wants to know. To find out how consumers would react to such products sold under the Colgate brand, the massive packaged-goods company has quietly established a test market in Peoria, Illinois, to test a line of ten over-the-counter (OTC) health-care products, all using the Colgate name. The line includes Colgate aspirin-free pain reliever, to compete with Tylenol; Colgate ibuprofen, to compete with Advil; Colgate cold tablets, to compete with Contac; Colgate night-time cold medicine, to compete with Nyquil;…show more content…
He says the reason Colgate has been able to break into the over-the-counter drug market in the first place is because other drugs have expanded and lost their niches; Tylenol and Alka-Seltzer both now make cold medicines, for example, and “that allows an opportunity for the outsiders, the Colgates, to come in and say there’s not perception that anybody is any different. The consumer will look for any acceptable brand name.” Mr. Ries argues that Colgate and the traditional over-the-counter medicine companies are basically turning their products into generic drugs instead of brands. They’re losing “the power of a narrow focus,” he says, adding, “It reflects stupidity on the part of the traditional over-the-counter marketers. . . . If the traditional medicines maintained their narrow focus, they wouldn’t leave room for an outsider such as Colgate.” If Colgate is too successful, meanwhile, it also risks cannibalizing its flagship product. Consultants note that almost all successful line extensions, and a lot of not-so-successful ones, hurt the product from which the took their name. They cite Miller High Life, whose share of the beer market has dwindled since the introduction of Miller Lite. “If Colgate made themselves to mean over-the-counter medicine, nobody would want to buy Colgate toothpaste,” contends Mr. Ries. Mr. Chajet agrees. Colgate could “save tens of millions of dollars by not having to introduce a new brand name” for its

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