COLGATE

PALMOLIVE
PAKISTAN
MARKETING
PROJECT

TABLE OF CONTENTS
 PAGE
EXECUTIVE SUMMARY
I CHAPTER 1 THE FIELD OF 1-3
MARKETING

I.1 INTRODUCTION

I.2 MARKETING STAGE USED

I.3 IMPLEMENTING THE

MARKETING CONCEPT

I.3.1 Customer orientation &

Customer Relationships
I.3.2 Coordination of marketing
activities
I.3.2.1 Quality
I.3.2.2 Value Creation
I.3.2.3 Colgate Organizational
Objectives & Performance
I.4 Colgate Societal Marketing
Concept
I.5 Colgate Ethical Behavior
Employments & Costs

II CHAPTER 2 COLGATE CO. DYNAMIC 4-6

MARKETING
ENVIRONMENT

II.1 Colgate external Macro

environment
II.1.1 Demographics
II.1.2 Competition
II.1.3 Social & Cultural Forces
II.1.4 Technology
II.2 Colgate External Micro-
II.2.1 environment
II.2.2 Their market
II.2.3 Their suppliers
II.3 Their market Intermediaries
Their Internal Relationships

III CHAPTER 3 GLOBAL MARKETS & 7-8

MARKETING
 III.1 Colgate International Marketing
III.1.1 Social and Cultural Forces
III.1.2 Competition
III.1.3 Political and Legal Forces
III.1.4 Boycott Laws
III.2 Their marketing mix
III.2.1 Research
III.2.2 Trade marks
III.2.3 Pricing
III.2.4 Distribution
III.3.5 Advertising

IV CHAPTER 4 CONSUMER MARKETS & 9-13

BUYING BEHAVIOR

IV.1 Geographic Distribution

IV.2 Consumer demographics
IV.3 Consumer Decision making
IV.3.1 Colgate Buying Patronage
Motives
IV.5 Information & Purchase
decisions
IV.6 Social Influences
IV.7 Social Class
IV.8 Reference Groups
IV.9 Families and Households
IV.10 Psychological Factors
IV.10.1 Perception
IV.10.2 Personality
IV.10.3 Attitude
IV.11 Situational Influences
V CHAPTER 5 BUSINESS MARKETS AND 14-16
BUYING BEHAVIOR

V.1 Oral Brands

V.1.1 Oral Products
V.1.2 Personal care Products
V.1.3 House Hold care Products
V.2 Demand :Fluctuating &
Elasticity
V.3 Buying Decision Process
V.3.1 Types of Buying Situations
V.3.2 CRM Levels at Colgate
V.4 The E-Commerce Impact on
Colgate
VI CHAPTER 6 MARKET 17-20
SEGMENTATTION,
TARGETING AND
POSITIONING
VI.1 Market Segmentation at Colgate
Co.
VI.2 Colgate Consumer Market
Segmentation
VI.2.1 Geographic Segmentation
VI.2.2 Demographic Segmentation
VI.2.3 Psychographic Segmentation
VI.2.4 Behavioral Segmentation
VI.3 Colgate Business Market
Segmentation
VI.3.1 Customer Location
VI.3.2 Customer Type
VI.3.3 Transaction Type
VI.4 Colgate Co. Positioning
VI.5 Colgate Market Share
VI.6 Colgate Forecasting For Year
2006

APPENDICES APPENDIX A Gross Profit Margins at Colgate

APPENDIX B Net Income at Colgate
APPENDIIX C Cash Dividend at Colgate
CONCLUSIONS
REFERENCES

I CHAPTER 1 THE FIELD OF MARKETING

I.1 INTRODUCTION

The organization/products I have chosen for marketing analysis is Colgate Co.

Obviously toothpaste is being used quite frequently in each and every home. Let us see
how different strategies apply on this product.

I.2 MARKETING STAGE USED

The marketing stage they are in is market oriented. Colgate is not following product
oriented or sales-oriented stage. They like to satisfy their customers and try their best at
that.

I.3 IMPLEMENTING THE MARKETING CONCEPT

Colgate Co. is implementing the marketing concept by customer relationships and

customer satisfaction.

I.3.1 CUSTOMER ORIENTATION AND CUSTOMER RELATIONSHIPS

One way that Colgate is using to build relationship with its customers is that it uses
internet communication, and builds relationships with its customers by personalizing
their interactions. They provide different options like customers calling on their toll free
number and having their queries answered. Thirdly they encourage comments on their
products by customers and get a feed back.
Colgate Co. has set the highest standards for the product. They are committed to insuring
that consumers can continue to trust Colgate products for their reliability, quality and
superior performance. In addition, to serve the billions of people in the markets where
business is done, they strive to produce products in the most efficient way possible so that
they are affordable to the greatest number of consumers.
Products sold by Colgate must not only meet all safety standards set by law, but also
often more stringent Company standards. They participate in programs to provide prompt
assistance to consumers in case of product tampering or misuse. Consumer health, safety
and well-being are of paramount concern to them. They are responsive to consumers.
According to them, business is consumer products, so their success depends upon
consumer satisfaction, trust and goodwill. They can best achieve their objectives and
serve the needs of consumers by following a consistent, fair and sensitive program of
consumer communication.

I.3.2 COORDINATION OF MARKETING ACTIVITIES

I.3.2.1 QUALITY
Colgate people try to maintain the quality of their products. It is significant to note that
Colgate tooth paste is being used in most of the homes twice a day. Most of the dentists
recommend it to their patients.

I.3.2.2 VALUE CREATION

Colgate people take a look to recognize what customers demand in a Colgate product.
They see what customers, value in a product. They are aware of their customer desires
and try to offer the best quality and the lowest possible price to its customers.
These two activities are well coordinated.

I.3.2.3 COLGATE ORGANIZATIONAL OBJECTIVES AND THEIR

PERFORMANCE

Colgate is committed to getting better every day in all it does, as individuals and as
teams. By better understanding consumers' and customers' expectations and continuously
working to innovate and improve products, services and processes, Colgate will "become
the best." In more than hundred countries, Colgate has been recognized as the best tooth
paste for its diversity.

I.3.2.4 COLGATE SOCIETAL MARKETING CONCEPT

Throughout the world, it is the goal of Colgate people to take part in projects to further
the development and welfare of the local community. Such projects include participating
in charitable drives and assuming responsibility for aiding the poor, injured and homeless
at the time of national disaster.
Their primary focus is on young people, particularly the education of young people.
Colgate believes that investments made in children today will benefits them all
tomorrow. That is why the Company sponsors reading programs, mentoring initiatives,
athletic competitions and other youth activities around the world. These efforts foster in
youth a spirit of competition and achievement.

I.4 COLGATE ETHICAL BEHAVIOUR

A code of conduct is provided in order to ensure for their employees, consumers, outside
businesses and local communities. They deal ethically with suppliers and customers.
Their aim in conducting purchasing operations is to ensure continuing, reliable sources
of supply. Honest dealing with customers and suppliers is essential to sound, lasting
relationships.

I.5 EMPLOYMENTS & COSTS

Colgate is offering jobs to many people in the following fields:

o Engineering & Manufacturing

 o Finance
o Human resources
o E-Commerce
o Information technology
o Legal
o Research & Development
o Marketing
o Sales

It is offering several development programs for undergraduate students in many of these

disciplines.
A no. of people is already working in these departments of Colgate Co.

II CHAPTER 2 COLGATE CO.: DYNAMIC MARKETING ENVIRONMENT

II.1 COLGATE EXTERNAL MACROENVIRONMENT

II.1.1 DEMOGRAPHICS

Population 1 mi 3 mi 5 mi
Male population 17,504 321,730 743,504
Female population 15,856 322,953 777,174
% Male Pop 52.54% 49.91% 48.89%
% Female 47.53% 50.09% 51.11%

II.1.2COMPETITION

At local level Colgate has competitors like Signal2, Neem, Close-up, Pepsodent, English
tooth paste and Mac leans, Medi cam and Sparkle. These compete in prices and quality.
For example, English tooth paste is considered to be the cheapest, but offers low quality
as compared to Colgate.

II.1.3 SOCIAL AND CULTURAL FORCES

Most of the people lay stress on quality of life rather than quantity of goods sold.
Protecting the world in is a vital concern and a continuing commitment. As a global
company dedicated to consumer products that contribute to the overall quality of life,
Colgate recognizes and constantly reaffirms the value of a healthy and clean
environment.
The health and safety of customers, people and the communities is very important. They
are committed to manufacturing; packaging and selling quality products that meet or
exceed health and safety rules and regulations. They will continue to improve their
products and packaging and invest in innovations that protect the environment.
As far as gender roles are concerned, most of the household shopping is done by women.
Men like to buy electrical equipment, cars, and computers.

II.1.4 TECHNOLOGY

COLGATE CO. use Colgate’s Information Technology Resources responsibly and in a

manner consistent with the Code and all other Company Guidelines, including those
related to specific computer technology, data protection, confidential and proprietary
information, and intellectual property rights. Colgate’s Information Technology
Resources include all computer equipment that is owned, leased or rented by Colgate,
regardless of the physical location, including, but not limited to, personal computers,
portable computer devices, network servers, access to the Internet, Colgate’s Intranet and
e-mail access devices. This also includes voice mail and other voice systems, fax
machines, and information obtained or downloaded from and/or disseminated
through the Internet and Colgate’s Intranet. “Information Technology Resources” also
includes access to Colgate’s network and e-mail from a computer that is not owned,
leased or rented by Colgate (i.e. home computers).
All of Colgate’s Information Technology Resources are the property of Colgate; this
includes the information created, stored or transmitted using Colgate Information
Technology Resources. The only information that is not considered Company property is
the information obtained during the limited personal use of Colgate Information
Technology Resources or information that is not deemed to be Company property under
applicable laws and regulations.
Colgate Information Technology Resources is used for Colgate business purposes.

II.2 COLGATE EXTERNAL MICROENVIRONMENT

II.2.1 THEIR MARKET

Colgate has its markets in almost more than 25 countries around the globe. These include
USA, India, Belgium, Brazil, Australia, Canada, Denmark, France, Finland, Germany,
Greece, India, Ireland, Italy, Mexico, Malaysia, Netherlands, Norway, Portugal, Spain,
Switzerland and UK.

II.2.2 THEIR SUPPLIERS

The suppliers of the company include the other services it needs from other organizations
in order to run its business. The Colgate Co. has requirements for the products including:

 Car Service
 Catering
 Chemicals
 Communications
 Computer peripherals
 Construction
 Consulting
 Contract manufacturing
 Co-packing
 Courier service
 Disposal service
 Employment service
 Flavor and fragrance in ingredients
 Graphic design
 Information technology
 Investment management
 Janitorial
 Landscaping
 Legal services
 Market research
 Media
 Packaging
 Printing
 Promotions
 Training
  Transportation
 Warehousing
 Waste management

II.2.3 THEIR MARKETING INTERMEDIARIES

Colgate products are generally marketed by a direct sales force at each individual
operating subsidiary or business unit. In some cases, distributors or brokers are used.

II.3 THEIR INTERNAL RELATIONSHIPS

All Colgate people are part of a global team, committed to working together across
countries and throughout the world. Only by sharing ideas, technologies and talents can
the Company achieve and sustain profitable growth.

III CHAPTER 3 GLOBAL MARKETS AND MARKETING

III.1 COLGATE INTERNATIONAL MARKETING

II.1.1 SOCIAL AND CULTURAL FORCES

For an Islamic country, such products in toothpaste are prohibited, which Muslims do not
use. For example, Colgate tooth paste selling in USA would have different ingredients
and taste as of that being sold in Pakistan or Saudi Arabia. Some customers are more
sensitive towards dental care, while some take it lightly.

III.1.2 COMPETITION

The international competitors that Colgate has are Pepsodent, Sparkle, Close-up, and Mac
leans. These all compete in quality as well as price.

III.1.3 POLITICAL AND LEGAL FORCES

Many countries in which Colgate or its affiliates do business have their own antitrust
laws. It is Colgate’s policy to comply with these laws. For example, The U.S. imposes
certain trade restrictions under the International Emergency Economic Powers Act, the
Trading with the Enemy Act and the related Executive Orders and U.S. Treasury
Department and U.S. Commerce Department regulations.

The Tariff Act of 1930 and other laws enforced at the border by the U.S Customs Service
provide that certain articles are prohibited importations into the U.S. These prohibited
importations are not limited.

III.1.4 BOYCOTT LAWS

In general, anti boycott laws and regulations prohibit cooperation with certain
unsanctioned foreign boycotts.

III.2 THEIR MARKETING MIX

III.2.1 RESEARCH

A Colgate research and development criterion supports it in many brands the products for
oral, personal care and household care. Approximately 40% of total Company sales in
2004 came from new products launched within the past five years. These new products
have led to strong market share growth and market leadership in core categories around
the world. For example, in 2004 Colgate Max Fresh and Colgate Simply White
toothpastes not only brought innovation to the category but also are contributing to record
market shares .Colgate people expect to continue keeping the pipeline full, especially in
high-margin categories of Oral Care, Personal Care and Pet Nutrition.

III.2.2 TRADE MARKS

Colgate Co follows principal global trademarks as Colgate, Palmolive, Ajax, Soup line,
Protex and several regional trademarks.
III.2.3 PRICING

Colgate has its pricing according to the currency and the taxes inclusive.

III.2.4 DISTRIBUTION

Colgate products are generally marketed by a direct sales force at each individual
operating subsidiary or business unit. In some cases, distributors or brokers are used.

III.2.5 ADVERTISING

One of the most important aspects of business is advertising. Advertising should be

creative and competitive, but at the same time honest and not misleading. Colgate
advertising must also avoid any stereotyping of individuals based on factors such as race,
religion, national origin, ethnic origin, color, gender, age, citizenship, sexual orientation,
veteran status, marital status or disability. Advertising creates more than a product image.
It creates reputation for reliability, dependability and trustworthiness. In addition, they
exercise care in the selection of the media in which advertising messages appear.

In 2004, Colgate’s advertising spending rose 10% to an all-time record level. In 2005,
they expect commercial spending to continue at competitive levels, including heavy
increases in media.

This spending will be carefully targeted to support new products in the Company’s core,
high-margin categories and in key competitive markets including the U.S., China, Russia,
India, Mexico and Brazil.

IV CHAPTER 4 CONSUMER MARKETS & BUYING BEHAVIOR

The products of Colgate Palmolive are selling in vast consumer markets. Colgate is a $10.6
billion consumer products company that serves people around the world with well-known
brands that make their lives healthier and more enjoyable.

Truly global in scope, Colgate operates in over 200 countries and territories.
 Approximately 70% of sales come from international operations.

Colgate is delivering strong global growth by following a tightly defined strategy to

increase market leadership positions for key products, such as toothpaste, toothbrushes, bar
and liquid soaps, deodorants/anti-per spirants, dishwashing detergents, household cleaners,
fabric conditioners and specialty pet food.

At Colgate, governance is the set of policies, principles and values that guides them
business processes in the best interests of shareholders and employees. At every level, the
principles that guide sound governance guide the actions of Colgate people. Colgate takes
it a challenge to make its customers happy.

IV.1 GEOGRAPHIC DISTRIBUTION

We will discuss the geographic distribution according to Pakistan. In Pakistan we have

rural population areas like Pir Sohawa, More, and Bara kaho, near the capital territory. The
urban areas in Pakistan include big cities like Islamabad, Lahore, Karachi and Faisalabad.
The capital territory has been further divided into towns like Johan Town, Satellite town,
Bahria Town. Population in Pakistan has been divided like that. The most densely
populated province of Pakistan is Punjab. The largest one in area is Balochistan. Consumer
behavior is greatly affected by these things. For example, people in Punjab are more
literate as compared to the ones in Baluchistan. They have a better knowledge of buying
and know what to buy and how to buy. They are aware of their values and can shop in
better manner.

IV.2 CONSUMER DEMOGRAPHICS

Consumer demographics include family life cycle. The stages in the life of a human
being in Pakistan are depicted in consumer demographics. Generally Colgate is preferred
by people of all the groups. Since it is medicated product, people of all the ages like to
use it. Since it is not that expensive and costly, people like to go for it. It comes in
different packs and costs. For example, a single person or bachelor might be going for a
small sized tooth paste. A home where there is family of 8 members living might choose
a jumbo sized Colgate. A newly married couple may go for a medium sized tooth paste.
Race & Ethnicity factor does not apply on the product.

IV.3 CONSUMER DECISION MAKING

The consumer decision making Process in case of the product is:

 o Need recognition
o Identification of alternatives
o Evaluation of alternatives
o Decisions
o Post purchase behavior

The customer feels like buying a tooth paste. He is moved by a desire. He recognizes the
need for it. He looks for other alternatives for example, a person might think that using
tooth paste powder is better than the tooth paste. He keeps some other options before
himself like SPARKLE, CLOSEUP, MACLEANS and some locally made tooth paste.
He compares the price & quality of the products. He tries to find out which one is the best
choice. OK, Colgate is good. It’s affordable and qualitative. I’ll buy this. After buying the
product, the consumer thinks that his decision was right. This is his post purchase
behavior. If he has used the product many times and is satisfied with it, he will neglect
any alternatives and simply go for Colgate. This shows his level of involvement with the
product.

IV.3 .1 COLGATE PATRONAGE BUYING MOTIVES

The patronage buying motives in case of Colgate are:

o Location of the shop

o Store appearance
o Service of staff at the Store
o Prices
o Sales people
o Their behavior

For example, BEST PRICE in Islamabad is offering good prices and services. Its location
is good. There is crowd of customers all of the time. As compared to this, whole sale
shops at Karachi Company offer very reasonable prices, but the service is slow and in
efficient. A customer has to wait for about 10 minutes to get his bill. This at times
irritates the customer. SALESDAY is offering good service but very high prices. Colgate
costing Rs. 40 would cost Rs. 60 there. The patronage motive behavior is reflected in this
way.

IV.4 INFORMATION AND PURCHASE DECISIONS

Well, the information and purchase decisions are usually the commercial one. Very little
social information is considered in case of Colgate. The commercials, retailers and
advertisements tend to influence a lot.

IV.5 SOCIAL INFLUENCES

Social influences matter to a reasonable extent in the case of the product. Culture matters
in the sense that we have an Islamized society. We are ordered to keep our selves clean
and tidy. Special care has to be taken in the tidiness of clothes and teeth. According to
famous saying” Cleanliness is half faith”.

IV.6 SOCIAL CLASS

Well in case of the product, all the 4 groups of classes use the product. Only the lower-
lower class, where there is low family income and a single person is earning and
supporting a big family, the product is not used. Colgate is being offered in many
packages.

IV.7 REFERENCE GROUPS

However, the reference groups that come for the product might include the celebrities on
TV or any other film star. Reference group is a group of people who influences a
person’s attitude, values and behavior. For example there was an AD of Colgate where
they showed a popular MTV vee-jay as a school teacher. She was teaching the students
( in the advertisement) and telling them how to recognize colors. She asked them what
the color of her teeth was. The small kids replied” yellow”. She was embarrassed. She
started using Colgate and asked from her students the same question again. This time,
their answer was “White”. This is how advertisements and media people influence our
personalities.

IV.8 FAMILIES AND HOUSEHOLDS

A family is a place where different people live together with a blood group relationship.
A household is a place where 2 or more people live together, but do not have a blood
relationship. For example, campus of YWCA is a house hold. Definitely, the product is
used by both the categories. A family buys the product and a two students living in the
same hostel room might be using it.

IV.10 PSYCHOLOGICAL FACTORS

For a marketer, Five levels of Maslow are too general. There are certain products to
which these strategies do not apply. For example, buying a house would come under the
first need, as it is associated with psychological level. But when a person wants to make a
farm house, extending on an area of 10 canals, it comes under the esteem stage. A
product like Colgate can not be placed into any of the levels of hierarchy. However, it can
help the marketer get a picture of the consumer’s mind. But these five levels are too
general and vivid for a certain product.

IV.10.1 PERCEPTION
BAD BREATH!!!!!! THAT PERSON HAS A BAD BREATH PROBLEM. This is what
we perceive. Research on every day odors has found that scents like vanilla. Cedar and
lavender create comforting associations and psychologists have found that good smells
have a nice effect on consumers. Hence Colgate is offering new varieties like COLGATE
fresh breath, COLGATE lemon & mint, Colgate tingly Red, Colgate tingly Blue. and
many more.

IV.10.2 PERSONALITY

It is defined as an individual’s patterns of traits that influence behavioral responses. For

example, we speak of people as arrogant, confident, flexible and dominating. It is
believed that personality traits do influence consumer’s perceptions and buying behavior.
The findings out of many studies are those consumers are influenced by the personality.
For example, a person wishing to buy a Suzuki might be having a different personality. A
person wishing to buy a BMW might be having a different personality. A person who
wants to buy COLGATE red may have likeliness for a red colored tooth paste. A person
who wants to buy Lemon-mint Colgate might be having likeliness for mint. Our
personalities are reflected in the way we live, the way we eat, the clothes we wear, the
cars we drive and many more things like these. Many things besides person enter into the
consumer buying decision process.

IV.10.3 ATTITUDE

The way we react towards things. Our approach, our thoughts and our mind set all come
under this. A consumer attitude do not always show purchase behavior. A person may be
having a great likeliness for the product and still not buying it. There certain reasons for
it. He might not be wishing to buy it on the same time. He might not be wising to buy it
the same day. He might be having a stock of the product at home. He might not be
having any money to buy the product. Purchase behavior at times contradicts attitudes. It
might not be a metric for a marketer.

IV.11 SITUATIONAL INFLUENNSES

These factors include things like:

o When consumers buy (time)

o Where consumers buy (place)
o Why consumers buy (Reason)
o Conditions under which people buy

Obviously, when people are in a hurry, they do not like to shop. People like to buy the
Colgate tooth paste when they need it. When they think that the one they are using now is
not satisfying their needs properly.
These include the buying motives of the customer. A family might be consuming a 100
pack tooth paste in a month. The other family might be consuming it in three months. The
time dimension many implications on purchase behavior. Messages or Ads must reach
consumers when they are in a state of decision making process.
The consumer’s mood in buying the product also matters. When a consumer is ill or not
in a good state of mind, he might not spend much time in asking questions about the
product or waiting in a line.

V CHAPTER 5 BUSINESS MARKETS & BUYING BEHAVIOR

A business market is where you do not buy the products for yourself or household
consumption. You buy a product for the reselling or some other purpose. That is the
context of business marketing. The supplier companies Colgate is dealing today include
bottle manufacturing companies, bags making companies and plastic making companies.
A business market is a much bigger place than a consumer market. You may be buying a
certain product from a company, use the product purchased from that company to make
your product and then resell it in a much better shape. As far as business marketing is
concerned, one of the top level executives of Colgate says,

“Colgate is capitalizing on strong top-line momentum as we enter 2005. This very

positive trend combined with our new global restructuring program bodes well for strong
profitable growth going forward. We remain focused on our high-margin core businesses
and believe we are taking the right measures to invest strategically for profitable growth."

Another top manager says,

“We are carefully targeting increased commercial investment to support our priority
businesses in key high-potential markets around the world. Our stepped-up advertising
spending is already paying off in higher market shares and new category leadership
positions around the world. With our sharp focus on new products, we remain dedicated
to accelerating innovation and furthering our leadership positions worldwide.”
This is how Colgate people manage to enter a business market and do a business there.
The brands Colgate is dealing with in the business and international markets include:

V.1 ORAL BRANDS

Their oral brands include:

V.1.1 ORAL PRODUCTS

These include:

 Colgate total
 Colgate Max Fresh
 Colgate luminous
 Simply White
 Sparkling white
 Tingly Red
 Colgate sensitive

V.1.2 PERSONAL CARE PRODUCTS

These include:

 Per spirants and deodorants

 Body gels
 body baths
 Shower Creams
 Shower gels
 Soaps
 After bath gels

V.1.3 HOUSE HOLD CARE PRODUCTS

These include:

 Floor cleaners
 window cleaners
 dish washers
 wood cleaner

Obviously the agriculture market has little to do with the Colgate. The Government
market has little to do with the Colgate Company. Also the company has nothing to do
with a non profit organization.

V.2 DEMNADS: FLUCTUATING AND ELASTICITY

As far as the demands of the products are considered, it is elastic in case of some of the
products and in elastic in case of some of the products. The buying behavior is affected
by the elasticity of the demand. As the fluctuations in demand of the Colgate products are
concerned, it might rise for some products and might fall for some products. For
example, a trend emerges that instead of using a Colgate Palmolive Soap, a hand wash
will be used. This reduces the demand for soaps and increases the demand for the hand
wash.

V.3 BUYING DECISION PROCESS

The business buying Decision process is almost the same as the consumer buying
decision making process. The only difference comes in the variety of the products and
brands. For example, instead of evaluating the alternatives for one product, different
needs are identified and different alternatives are identified. Then those different
alternatives are evaluated and a final decision making is followed. The products Colgate
is manufacturing is more than 100, so for each and every one of the products, this process
can not be written.

V.3.1 TYPES OF BUYING SITUATIONS

If the person is buying it for the first time, which would be a new task buy. If the person
or firm is satisfied with the product, then there is straight re-buy involved. If the firm is
satisfied with the product, and wants to consider some alternatives as well, then he goes
for modified reburying. All these three buying situations apply to Colgate products. It
might vary from person to person to go for which buying type.

V.3.2 CRM LEVELS AT COLGATE

Colgate people believe in keeping its customers satisfied and develop a tong term
involvement with their products. The Colgate goes for operational CRM when it tells its
customers not to hesitate to give a call on toll-free number. They maintain a list of current
data, historical reports and some annual reports to implement analytical level of CRM.
They have maintained a list of annual reports 2001, 2003 and 2005. They use the data
from these reports and manage to maintain an analytical CRM. They provide their
customers brochures and catalogs about their different products in order to ensure
collaborative CRM. Different pamphlets are given to their customers.

V.4 THE E-COMMERCE IMPACT ON COLGATE

Well, the e-commerce has played a major role in the development of many products over
the internet during the past few years. On line shopping is made possible. Different firms
ask you to see their product and place an order via their credit card. Colgate asks its
customers to do so. It first asks its customers to have a look at a particular product, rate it
and place an order for it if they feel pleased with it, and they think that it can satisfy their
needs appropriately.

VI CHAPTER 6 MARKET SEGMENTATION, TARGETING, AND

 POSITIONING

VI.1 MARKET SEGMENTATION AT COLGATE CO.

The market segmentation involves dividing a bigger market into a smaller one and
similar one. This process is valid for very big target markets and doing the marketing
there. The Colgate people are implanting this concept in most of their products. Market
segmentation is a typical market oriented approach. It is typically based on a customer
satisfaction approach. It is done where different wants of the same group of customers are
satisfied in a diverse way. For example, Colgate is making Soft Soap 100 gms for a
person, who lives in small family home, 125 gms for a large family, and 80 gms for a
single person. Palmolive natural is especially for kids. In market segmentation, the needs
of all the customers in different target market and with the similar needs are satisfied. In
the context of business and international marketing, markets are always segmented.
Different age groups and different sizes of segmented markets are always there. It
depends on the intelligence of the marketer to decide how to segment the market. There
are different types of Soaps with “oil control”, “greasy skin” “aloe Vera” treatment.
There is a variety of shampoos that Colgate is manufacturing. These include ”flat hair”,
“extra shine”, “dry hair”, “damaged hair”, ”color treated hair”, “shampoo plus
conditioner”, “extra shiny treatment” and many more like these. We see variety in body
wash and shower gel products as well. Some people like lavender, some people have a
taste for fruit scented shower gels. Some people go for light smells, whereas some have a
taste for heavy smells. Some have a favor for floral scented shower gels. All this comes
under market segmentation. The variety in the products of Colgate shows us that they are
implementing a segmented marketing concept.

VI.2 COLGATE CONSUMER MARKET SEGMENTATION

The consumer markets can be segmented in a no. of ways. These include:

VI.2.1 GEOGRAPHIC SEGMENTATION

The geographic segmentation is done on the basis of region, population factor, urban or
climatic conditions. It means segmenting the markets on these bases. For, example, for
very hot areas, Colgate has included a sun screen ingredient in its soaps to prevent from
sun rays. On geographic basis, the climatic condition population factor and regional
distribution matter a lot.

VI.2.2 DEMOGRAPHIC SEGMENTATION

These comprise age, gender, family life cycle, income, and education. For, example, the
need of a 13 year old teen age would be different from that of a retired army officer.
A teen age girl likes to use soap, where as an earning lady might think that she has to take
care of her skin, she should finally go for a deep cleansing face wash. It is generally
assumed that a person below the age of 25 does not go for a “hair color treatment”
shampoo. A person above this age has applied some hair color and would go for a “hair
color restoring” shampoo. Income might matter in the same way. As gender is
considered, beauty and personal care products are used more by females.

VI.2.3 PSYCHOGRAPHIC SEGMENTATION

It comprises examine attributes relating to way how a person thinks and what are the
personality characteristics of a person or customer. Personality means persona, behavior,
traits and quality. Also, our life style matter in market segmentation. How a person
spends his time, what are his activities, interests and opinions. The life style affects
greatly products a person buys and the brands he prefers. Some of the Colgate products
depict a lifestyle strategy. But this is a difficult strategy to be used while going for
market segmentation. A marketer may not be aware of the different life styles of the
people in target markets. Psychographic marketing segmentation is difficult to
implement.

VI.2.4 BEHAVIORAL SEGMENTATION

It consists of two things. The benefits desired from the product and the rate at which the
customer is using the product. Well, behavioral segmentation concept is applied on
Colgate. The benefits from the tooth paste product are no plaque, fresh breath, no
cavities, low price, good quality and white teeth. The usage rate can also be determined
from the data. If the records of a certain shop or general stores are checked, if they show
that most of the tooth pastes bought were Colgate. This type of analysis makes a marketer
know the usage rate of the product. He is aware to implement behavioral market
segmentation.

VI.3 COLGATE BUSINESS MARKET SEGMENTATION

VI.3.1 CUSTOMER LOCATION

Colgate people know in what markets they are doing their business. And how many
markets they are dealing in. They know the location of their customer It is doing its
business in many countries. Colgate has its markets in almost more than 25 countries
around the globe. These include USA, India, Belgium, Brazil, Australia, Canada,
Denmark, France, Finland, Germany, Greece, India, Ireland, Italy, Mexico, Malaysia,
Netherlands, Norway, Portugal, Spain, Switzerland and UK. A segmented marketing
concept is also applied for these countries. Some of these countries are pre-industrial
countries. Some of these are Post-industrial countries. Some of these are less developed
countries and some of these are industrializing countries. Business market segmentation
is done on these bases.

VI.3.2 CUSTOMER TYPE

Business customer size can be located using factors like sales volume, no. of employees,
no. of production facilities, and no. of sales officers. The organizational structure of a
company in market also matters. Some of the companies doing the business with Colgate
might be using a centralized approach. Some of the companies might be using a
decentralized approach. Some of the companies might be using a hybrid model. Selling
skills also differ due to these.

VI.3.3 TRANSACTION CONDITIONS

The transaction conditions include the buying situations, usage rate and order size. This
concept does not apply to Colgate. However, the usage rate applies on Colgate. It is
heavy user product.

VI.4 COLGATE CO. POSITIONING

The Colgate people have tried to sustain themselves through tough competition and hard
work. Media and advertisements are also responsible for creating an image of the
company in the eyes of its customers and competitors.
According to the words of a top level person at Colgate,
“It's my pleasure to welcome you to the world of Colgate-Palmolive. Colgate is a truly
global company doing business in over 200 countries.”
Another person at Colgate says,

“Our long history of strong performance comes from absolute focus on our core global
businesses and dedication to our successful worldwide financial strategy.”

This is the way the Colgate people have positioned themselves. The company has got
certain awards for the best performance throughout the world.

The table given below shows a list of awards:

Best Companies for Minorities — Fortune Magazine 2000-

2004
Global Most Admired Companies — Fortune Magazine 2003-
2004
America's Most Admired Companies (Consumer Products Household 2003-
& Personal Products) — Fortune Magazine 2004
50 Best Companies for Diversity — DiversityInc.com 2001,
2004
Best Workplaces for Commuters — Environmental Protection Agency 2004
Hispanic Corporate 100 — Hispanic Magazine 2001-
2003
100 Best Companies for Working Mothers — Working Mother 2002-
Magazine 2005
50 Best Companies for Latinas — Latina Style Magazine 2002-
 2003
Top 20 Companies for Leaders — Chief Executive Magazine 2002-
2003
100 Best Companies to Work For — Fortune Magazine 2003
Hispanic Creative Advertising Award — Advertising Agencies 2002
Magazine

VI.5 COLGATE MARKET SHARE

Colgate is capitalizing on strong top-line momentum as they enter 2005. This very
positive trend combined with a new global restructuring program bodes well for strong
profitable growth going forward. Colgate People remain focused on their high-margin
core businesses and believe they are taking the right measures to invest strategically for
profitable growth. Colgate achieved strong sales and unit volume growth in 2004.
Colgate’s sales and volume did grow very strongly in 2004. Global sales increased 7.0%
and global unit volume from continuing businesses grew 6.5%, the strongest unit volume
growth in six years.

VI.6 COLGATE FORECASTING FOR YEAR 2006

They firmly believe that the fundamentals of their business are very strong and their
business strategy is sound. The top-line growth momentum seen in 2004 is continuing
and market shares are growing stronger and stronger around the world. They remain
extremely focused on new product innovation in the core categories and are prepared to
continue to spend aggressively to support their global brands. With the expected savings
from the 2004 Restructuring Program and ongoing “Funding the Growth” programs, they
are optimistic that they will reach their profit expectations in 2005, and they believe they
are back on track to return to double-digit earnings per share growth in 2006.

CONCLUSIONS

In the end, I conclude that Colgate Co. is a typical market oriented company, operating in
more than 200 countries. They feel pride in making their customers happy. They are
applying the societal way of marketing. They are aware of their social and ethical
responsibilities. They are providing many new employee oriented programs, both for
senior level and entry level people. They are managing the consumer and business
markets in an effective manner. They encourage innovations and have introduced new
products which have played a vital role in getting a market share for them. They face
their competitors and feel proud to take it a challenge. They are well aware of the
psychology of the people in different markets. They know how to conduct their business
in international communities. The way they consider different factors like demographics,
customer location, geographical distributions and many others. They maintain levels of
CRM at the company to ensure good customer support. The way they proved themselves
in consumer, business and international markets. They still have a high aim to attain more
and more.

APPENDIX A GROSS PROFIT MARGIN AT COLGATE

APPENDIX B NET INCOME AT COLGATE
APPENDIX C CASH DIVEDEND AT COLGATE