Colgate-Palmolive is recognized as the world’s leader in personal care sales which included oral hygiene products like toothbrushes and toothpastes. In 1991, its sales topped at $6 billion and profits at $2.76 billion as it cornered 43% of the world’s toothpaste market and 16% of the world’s toothbrush market.
Colgate-Palmolive’s positioning strategy for its toothbrush line in food stores has aided in capturing heir current dominant market share. Its in-store displays, combining toothbrushes with toothpaste packs and locating the Colgate-Palmolive line of toothbrushes in the middle of the stores’ shelves have contributed to this dominance. This strategy has been successful, as sales through food stores, drug stores and mass …show more content…
First, although its competitors, i.e. Oral-B, Johnson & Johnson and Procter & Gamble, have gained a foot-hold in this niche market already, Colgate-Palmolive can still make a dent with its new Precision toothbrush, thus enabling them to enter a new and potentially highly profitable market segment. Since the “super-premium” category accounts for 35% of the volume and 46% of the dollar sales of toothbrushes this niche category may in turn result in a substantial profit margin.
Secondly, with the baby boomers and younger generations becoming more concerned with the health of their gums, they will be willing to pay the above mentioned premium for a toothbrush which is optimized for better gum care. Colgate-Palmolive can capitalize upon this demographic segment to ensure a successful release of their “super-premium” Precision toothbrush.
Finally, since 82% of toothbrush purchases are unplanned and many consumers are unaware of the technological and cost variation among