Colgate Palmolive Case Study

1134 Words Apr 18th, 2012 5 Pages
The CP Case Study
In the early 1990’s, the toothbrush industry was experiencing major growth; in fact, “in 1992 dollar sales increased by 21% in value and 18% in volume” (Quelch & Laidler, 2000, p. 48). The increase in sales was greatly due to a huge influx of new products, advertising, new technologies, and an increase in consumer concern for oral health. During this time, the Colgate-Palmolive (CP) company was not only a major player in the oral care industry, but also “CP was a global leader in household and personal care products” (Quelch & Laidler, 2000, p. 47). Management at CP understood consumer concerns and the need for advances in technology, and because of this, the Oral Care Division at CP was assigned for three years to
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50). Quelch states that through marketing research, CP was able to identify that the baby boomers were now more worried about their oral gum health versus cavity prevention (Quelch & Laidler, 2000, p. 50). The research proved that over 46% of consumers were more worried about the therapeutic benefit of teeth brushing versus the smaller 33% of consumers that were not concerned with their oral health. The research also proved that the 46% group was willing to pay a premium amount for a superior toothbrush which was able to help prevent gum disease. These three mentioned changes - advertising, technology, and consumer concern - have influenced a change in toothbrush market segmentation.
The toothbrush industry is segmented to meet its consumers’ desires. During the 1980’s the toothbrush segment market was divided into two areas, the professional segment and the value segment. These two segments could further be divided into smaller segments based on bristle stiffness and head size, with larger brushes for adults and smaller brushes for children. The two majors segments of the toothbrush market eventually grew. By the late 1980’s the “emergence” (Quelch & Laidler, 2000) of a third toothbrush segment formed with the arrival of a super-premium brush. Three major toothbrush segments now existed: the value segment, the professional segment, and the super-premium segment.

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