Introduction
Colgate Max Fresh (CMF) was launched in the USA market by Colgate-Palmolive as a premium brand of toothpaste. CMF was introduced to enable Colgate-Palmolive to compete effectively with its rivals such as Proctor & Gamble. CMF was very successful because it managed to increase Colgate-Palmolive’s share of the US market to 34.8% in 2004 as shown in figure 1 in the appendix.
This report presents a critical analysis of the factors that led to the success of CMF in the United States of America. The factors that will be discussed include positioning, advertising, and marketing support. The report will also analyze the adaptation strategies that were used to launch CMF in China and Mexico. Based on these analyses, a marketing plan for launching CMF as a global brand will be presented.
Positioning
The elements of CMF’s positioning strategy include the following. First, CMF was positioned as a premium brand. In particular, potential users of the product were promised benefits such as freshness of breath and guaranteed whitening of their teeth. The strength of this strategy is that the promises were based on market research findings.
Concisely, consumer research had indicated that customers were interested in oral care products that had the ability to improve breath freshness. Additionally, whitening of teeth was becoming an important benefit to customers.
Thus, customers were likely to buy CMF because it promised to deliver these benefits. Nonetheless, the product was at the risk of losing its brand integrity if it did not have the qualities or attributes that were associated with it.
Second, CMF was launched in two different forms namely, liquid bottles and gel tubes as shown in picture 1 in the appendix. Similarly, it was launched in two different flavors namely, blue cool mint and green clean mint. These differentiation strategies were important because they reinforced the brand personality of the product.
Concisely, the different flavors were meant to provide customers with immediate benefits so that they could feel the superior qualities of the product. Nonetheless, introducing more flavors could have improved the success of the product in the US market.
This is because not every consumer was likely to be interested in the two flavors. Thus, extending the product line by including additional flavors could have enabled Colgate-Palmolive to satisfy the tastes and preferences of more customers in the US market.
Third, CMF was introduced at a price that was comparable to that of CWE, which was its main rival in the market. The benefit of setting comparable prices is that it averts the threat of substitution. Concisely, customers who are responsive to prices often buy low cost brands that promise high quality. In this regard, CMF could not have penetrated the market easily if its price was higher than that of CWE.
Finally, the attractive bottle package that was used to market the product improved its appeal to customers in retail stores. Strong visual impacts usually enable customers to connect with the product by recognizing it easily.
Ease of recognition facilitates repeat purchase because customers are likely to buy a brand if they can recall its attributes. The elements discussed in the foregoing paragraphs improved the process of positioning CMF by emphasizing its unique qualities and presenting it as a premium brand.
Advertising
Advertising is one of the major factors that led to the success of CMF in the USA. The company used 73% of its marketing budget to advertise CMF. The adverts were meant to create awareness about the product. Allocating over 70% of marketing budget to advertising can be justified by the fact that new products lack brand awareness.
Thus, they can only penetrate the market if consumers are informed about their attributes through adverts. Moreover, adverts are effective persuasion tools that often convince customers to purchase a brand. Nonetheless, advertising is not the only strategy for improving brand equity. Promotional activities such as publicity could have improved CMF’s brand equity at a lower cost.
This is because publicity campaigns involve providing detailed information about a product through the media, which enables customers to understand its salient features.
Additionally, adverts might not reach potential customers or the messages might be misunderstood. In this regard, part of the marketing budget should have been allocated to other promotional activities such as publicity campaigns in order to improve CMF’s brand equity.
CMF was targeted at adults (18-34 years), especially, the women. Psycho-graphically targeted consumers included people who valued freshness of the mouth. Individuals in this segment were likely to purchase CMF to keep their mouth clean and fresh. Nonetheless, there is no direct link between the age group of 18-to-34-year olds and CMF.
This is because people who are aged above 34 years are also likely to be interested in the benefits provided by CMF. Consequently, more age groups should have been included in order to expand the market segment for the product. In addition, segmentation according to psychographic and demographic factors has little meaning.
This is because both segments seem to be interested in the same benefits. Moreover, no specific product attributes were developed for each segment because all CMF’s flavors and forms were available to both segments.
Finally, Emily Proctor was used in the adverts for CMF in the USA market. Picture 2 shows CMF’s adverts that were used in the USA. Emily was a celebrity who was associated with looks that were beyond the obvious.
Thus, there was a fit between the celebrity’s attributes and CMF, which was associated with superior qualities. In this regard, using Emily Procter in the adverts enabled customers to associate CMF with superior qualities, thereby improving its brand equity.
Marketing Support
The launch of CMF was supported by a website that included Emily’s promotions. The website supported other promotional activities such as program sponsorships on MTV, by providing more information about the product.
The resulting increase in brand awareness is likely to have boosted the sales of CMF in the USA market. CMF’s marketers also used offline promotional activities such as in store merchandizing and rewarding customers for their purchases (sales promotion).
Merchandizing involves arranging goods on the shelves of a retail store in a manner that improves customers’ buying experience. Merchandizing increases the number of customers who visit a store to purchase particular products. This is because the attractive product displays draws the attention of customers so that they can seek more information about them.
In this regard, attractive displays motivated customers to seek information about CMF concerning issues such as its price and brand promise. The information is likely to have influenced customers to make a decision to purchase the product.
Merchandizing also enables marketers to interact with their customers. For example, sales assistants or merchandisers within a store can obtain vital feedback from customers concerning the product’s features and their experiences in using it.
CMF’s marketing initiatives were also supported by sales promotions, which involved offering money-back rebates and giving customers free products. These rewards are valuable to customers who usually perceive them as a way of recognizing their effort to purchase a particular brand.
In addition, sales promotions encourage customers to switch brands by trying the product that is on promotion. Thus, the rapid increase in the sales of CMF can be attributed to the effectiveness of the sales promotions.
Despite these benefits, sales promotions have negative effects. In most cases, the promotions have short-term positive effects on sales. In particular, customers may purchase the brand in order to receive the rewards offered during sales promotions rather than to explore its unique attributes.
Consequently, the high sales of CMF during the first six months might not be a true reflection of its success in the USA market. In addition, consumers may develop expectations for further promotions. Thus, Colgate-Palmolive will have to extend its sales promotion activities, thereby incurring high marketing costs.
Conclusion
CMF succeeded in the USA market due to three factors namely, advertising, positioning, and marketing support. CMF was positioned as a premium brand in order to make it attractive to customers. Advertising improved the positioning strategy by highlighting the salient features of CMF.
Additionally, advertising created awareness about the product, thereby improving its brand equity. Similarly, merchandizing and sales promotions motivated customers to try the product, thereby increasing its sales.