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Colgate-Palmolive

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Colgate-Palmolive

Prepared for:
Bill Waxman
Organizational Behavior
Edison Community College

Prepared by:
Catalina De Fex
Jenny Smith
James Tobias

October 28, 2013

October 28, 2013

Mr. Bill Waxman Instructor Organizational Behavior Edison Community College 1973 Edison Drive Piqua, Ohio 45356 Dear Mr. Waxman: Here is our strategic plan for our organizational behavior class. Throughout this report we will explain our plan intended to increase financial satisfaction for Colgate- Palmolive. We included a complete analysis of internal and environmental factors that will benefit our understanding of this company’s internal and external culture. We sincerely hope that this report will fulfill your expectations, and we assure you that the oral presentation will be a great complement in order to influence the implementation of our ideas. Thank you for your time and consideration, and we look forward to finally present our ideas to you and to our audience. Sincerely, Colgate-Palmolive StudyGroup
Table of Contents Executive summary v Introduction 6 Objectives of the Research 6 Colgate Palmolive Company 6 Mission Statement 7 Objectives 8 Analysis of Colgate’s Marketing Strategy 9 Oral Care Products 10 Personal Care Products 10 Home Care Products 10 Product lines Competition and customers 11 Increasing Market Share 12 BCG Approach 13 Environmental Forces 15 Socio Cultural Forces 16 Technological Forces 16 Legal and Regulatory Forces 16 Competitive Forces 16 Economic Forces 17 Political Forces 17 SWOT Analysis Overview 17 Swot Analysis of two Competitors 18 Swot Analysis Colgate Palmolive 20 Strategic Analysis for Colgate Palmolive 20 Priority #1 Decrease possibilities for Product recalls in the future 20 Priority #2 Create a research and development plan to come up with new product ideas that satisfy current market needs 21 Priority #3 Restructuring and re-branding Colgate’s current Pet food line currently managed by Hills Corporation 21 Strategic Plan Hills Pet Food Line 21 Works Cited 23 24 25
Executive Summary
The following report was requested by Bill Waxman, professor of Organizational Behavior at Edison Community College as part of our first case study. Our mission was to research Colgate-Palmolive in order to identify business opportunities as well as weaknesses to come up with a strategic plan that will complement their existing method of doing business, and then present our findings to top management.
The Company. Created in 1806 by William Colgate, Colgate-Palmolive Company is an American multinational consumer Products Company dedicated to the production, distribution and provision of household, health care and personal products, such as soaps, detergents, and oral hygiene products.
Economic standing. According to Ian Cook, Chairman, President and Chief Executive Officer of this company the Company's 2011 global business net sales grew 7.5% and global unit volume from continuing businesses grew 4.0%. The company achieved its profit goals, with diluted earnings per share increasing 4%, and despite continuing increases in material costs, an intense competitive environment and volatile macroeconomic conditions worldwide they were able to remain stable.
Strategic Plan for new business opportunity. Due to new information about the ingredients and additives of pet food being available to the consumers, people are becoming more concerned about what they buy, not only for human consumption, but for their beloved pets too. Based on these facts it is clear that Colgate Palmolive is in need for developing a new product that will satisfy the needs of this new market trend. This is why our team will focus efforts in creating a strategic plan to address this issue to engage in a new business venture that will compliment Colgate’s existing method for marketing, selling, and promoting their pet food line.

Introduction The following report was requested by Bill Waxman, professor of Organizational Behavior at Edison Community College as part of our first case study. Objectives of the Research Our mission was to research Colgate-Palmolive in order to identify business opportunities as well as weaknesses to come up with a strategic plan that will complement their existing method of doing business, and then present our findings to top management.
Colgate-Palmolive Company
Created in 1806 by William Colgate, Colgate-Palmolive Company is an American multinational consumer products company dedicated to the production, distribution and provision of household, health care and personal products, such as soaps, detergents, and oral hygiene products. According to Ian Cook, Chairman, President and Chief Executive Officer of this company the Company's 2011 global business net sales grew 7.5 percent and global unit volume from continuing businesses grew 4.0 percent. The company achieved its profit goals, with diluted earnings per share increasing 4%, and despite continuing increases in material costs, an intense competitive environment and volatile macroeconomic conditions worldwide they were able to remain stable (“Message from the CEO”)
Colgate-Palmolive has been a leading brand in the dental care and household industry for many years. Colgate-Palmolive is currently reporting that their 3rd quarter profits have increased 1.7 percent. Not to mention that the company’s stock has risen 15 percent from the start of 2012. The company is making a dramatic change; Colgate’s current financial situation is very stable. They have been increasing their net sales every year from 2008 to 2012; they have gone from $15.33 billion in 2008 to $17.1 billion in 2012. Colgate had a 58.4% gross profit margin in the fourth quarter of 2012. Colgate is constantly trying to find new ways to increase the sustainability profile of their products. Colgate- Palmolive stresses the idea of meeting customers’ expectations as their needs change; Colgate also has a strong commitment to safety and quality.
Colgate- Palmolive has over 37,700 employees worldwide, and their selling, general and administrative expenses are the largest, they include: * Employee pay, benefits, and training * Advertising and Marketing * Production cost of products * Supplies * Distribution centers over head * Shipment of products and supplies
Taxes- sales tax on purchase of supplies, employee taxes, and income taxes also represent part of their major fixed costs. During 2013- Colgate had a one-time after tax due to the re-measurement of balance sheet of Venezuela as a result of currency devaluation. This obviously contributed to the increase in fixed expenses reported on their latest financial report.

Mission Statement
Our three fundamental values — Caring, Global Teamwork and Continuous Improvement — are part of everything we do. They are the foundation for our business strategy and are reflected in every aspect of our work life.
Caring
The Company cares about people: Colgate people, customers, shareholders and business partners. Colgate is committed to act with compassion, integrity, honesty and high ethics in all situations, to listen with respect to others and to value differences. The Company is also committed to protect the global environment, to enhance the communities where Colgate people live and work, and to be compliant with government laws and regulations.
Global Teamwork
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.

Continuous Improvement
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.
Objectives
* Engaging To Build Our Brands: Engaging with consumers is at the heart of Colgate's focused global strategy, which drives the Company's strong performance and market share gains worldwide. Stronger consumer engagement begins with better insights. We are obtaining deeper and more meaningful consumer insights and using them to strengthen product development, packaging and the communications we deliver through our integrated marketing campaigns. These innovative marketing programs deliver our brand messages using a combination of traditional media outlets, in-store communications and newer digital outlets, including social media. * Engaging to Build Our Brands with the Profession: Colgate is driving engagement and building our leadership with dental and veterinary professionals to strengthen their endorsement of our brands. This, in turn, builds market share and brand loyalty. Colgate helps educate dental and veterinary professionals about the science behind Colgate and Hill's products by being deeply involved with academia, professional organizations and conventions, and public health activities to improve oral health and pet health around the world. * Engaging to Build Our Brands with Our Customers: Across retail environments, whether small rural stores or large global chains, Colgate is working closely with its retail partners to share expertise and provide shoppers with the best value and service. Colgate is engaging its customers worldwide by sharing unique shopper insights, providing innovative in-store marketing communications and merchandising techniques, and developing and executing joint business planning initiatives. These activities ensure the right product assortment at each location and help to make shopping a consumer-friendly, enjoyable experience, which drives increased sales for both Colgate and the retailer * Innovation for Growth: At Colgate, developing innovative new products is a key driver of profitable growth. Colgate's consumer innovation centers, in strategic locations throughout the world, are focused on developing insight-driven innovation that provides value-added new products across all price points. Marketing personnel work closely with scientists and other researchers, as well as external organizations and academia, to ensure we have the technology in place to meet both short and long-term consumer needs. Beyond new products, innovation is embedded into the Company's culture to encourage new ideas and improved processes throughout every aspect of the organization – from the supply chain to marketing to finance and all support services. * Effectiveness and Efficiency: Integral to Colgate's global strategy is the ability to generate funds to invest in business growth. Through both established efficiency programs applied to all aspects of our business and ongoing identification of new ways to find savings, the Company constantly strives to improve its organizational capabilities and speed, while reducing costs. Programs are wide-ranging and include many small initiatives amounting to millions of dollars in savings that fund new product development and marketing activities, as well as helping to deliver strong profitability. * Leading to Win: At Colgate, we have long believed that our values-based culture forms a strong foundation for good governance which leads to good results. Employees at all levels learn to take personal responsibility for being leaders, and they commit to conducting business with the highest integrity, incorporating Colgate's values of Caring, Continuous Improvement and Global Teamwork into all business activities. Colgate also demonstrates leadership as a member of the global community. Through our sustainability efforts, we are ensuring that the business grows consistently and responsibly and benefits those we serve globally, while promoting the well-being of future generations.
Analysis of Colgate’s Marketing Strategy
The company understands the importance of innovation, and it is continuously trying to find new ways to satisfy their customers; placing special emphasis on two areas: * Innovative products that are incremental, breakthrough and transformational. * Tailored go-to-market strategies that can accelerate and sustain our growth.
Colgate-Palmolive comprehends that consumers are now more demanding of what they value in brand choice beyond price and many other environmental factors that contribute to their changes in buying behavior, and it is important for them to be aware of such changes in order to maintain their market share(“Message from the CEO”).
As a result of an intense competition Colgate-Palmolive needs to constantly promote its brands to maintain customer loyalty. In order to do this they need to find ways to increased engagement with its consumers; Colgate is doing this through powerful integrated marketing campaigns that take full advantage of digital and social media (“Message from the CEO”). The company is also focusing on identifying deeper, more meaningful insights in order to establish stronger connections with all of our constituencies and create a deeper level of commitment to its brands.
Colgate Palmolive serves their customers by differentiating their products in each target market. They created different marketing strategies for each of their products lines according to their market segment. Consequently, their marketing mixes vary as to the product features, distribution methods, promotion, and prices. Through the segmentation of their markets they are able to reach different types of consumers. Colgate-Palmolive is a global company serving hundreds of millions of consumers worldwide with innovative products such as household cleaning products, dental care, and pet nutrition. Colgate-Palmolive focus on an extensive range of target markets making use of segmentation variables such as demographic, geographic, psychographic, and behavioristic variables to address the need of their customers. Their product lines are divided into three categories: * Oral Care Products: Some of Colgate's "Total" line of toothpaste includes Colgate Total Advanced, Colgate ProClinical, Colgate Tartar Control, Colgate Ultrabrite and Colgate Cavity Protection. The children’s line includes, SpongeBob Square Pants, Dora the Explorer, and Colgate 2in1. Colgate also makes over-the-counter products and supplies for dentists these include, teeth whitening, fluoride, sensitivity products and toothbrushes. Some over-the-counter products include, canker sore pain relievers, Colgate Orabase with Benzocaine, and Colgate Peroxyl Rinse. Colgate 360, Colgate Motion, Colgate Wave, Colgate Navigator and Colgate Total Professional are among Colgate's line of toothbrushes. * Personal Care Products: Colgate manufactures several lines of personal care toiletries for men and women. Colgate shaving cream, deodorants, and body wash products for men include Aft and Skin Bracer by Mennen. Irish Spring bar soap and body washes, along with several deodorants such as Stainguard and Speed Stick 24/7. Lady Speed Stick antiperspirant, Invisible Dry and Lady Speed Stick with Aloe are among deodorants for women. Female soap products include Softsoap hand soaps, body washes, moisturizers, hand gel sanitizers and Vel beauty bars. Teen Spirit and Teen Spirit Fun Fragrance are two Colgate lines of dry deodorants designed especially to attract teens. * Home Care Products: Colgate produces several lines of household cleaning products. Ajax brand scouring and machine washing cleaners, Palmolive hand soap and dishwashing liquid, and Dermassage dishwashing liquids are popular. Colgate's fabric care line of cleaners includes Dynamo and Fresh Start laundry detergents; Suavitel Fabric conditioners as well as Murphy Oil disposable wipes and household cleaner.

Product Lines, Competition & Customers
Oral care - Major Competitors- P&G (Crest), GlaxoSmithKline (Aquafresh)
Customer base- every household, mainly the middle class * Toothpaste * Toothbrushes * Colgate kids * products from Dentists * Oral benzocaine * Mouth wash

Personal Care- Major Competitors- P&G, L’Oreal, Unilever
Customer base- every household, mainly the middle class * Men’s Deodorant- Speed Stick * Women’s Deodorant-Lady’s Speed Stick * body wash- Softsoap, Irish Spring * Liquid Hand soap- Softsoap Hands * Bar Soap- Softsoap, Irish Spring * Toiletries for men

Home Care- Major Competitors- P&G, Clorox, Church& Dwight, Reckitt Benckiser
Customer base-every household, mainly middle class * Dishwashing- Palmolive ,Ajax, Dermassage * Household Cleaners- Murphy’sOil, Ajax * Fabric Conditioner- Suavitel

Pet Nutrition- Major Competitors-P&G (Iams)Nestle(Purina), Mars(Pedigree)
Customer base-middle class, upper class- Not affordable for all households * Science Diet

Increasing Market Share
With a strong portfolio of globally recognized brands that provides a competitive advantage to the company and strengthens its dominant position in the market, Colgate-Palmolive is now focusing its efforts on acquiring businesses in order to increase its chances of expanding its market share in order to generate higher top-line growth and margin. To continue its market consolidation, the company recently acquired the Sanex, a multi-category personal care brand with 2010 net sales of €187 million (approximately US$260 million), primarily in Western Europe (“Company News”). Ian Cook, Colgate's Chairman, President and CEO commented, "Sanex is a very strong brand that we have admired for a long time. We are delighted that this acquisition will strengthen Colgate's positions in the shower gel and deodorant categories in several key countries in Europe and our overall personal care business in that region”(“Company News”). Mr. Cook claimed that "Sanex's unique positioning around skin health is a terrific complement to Palmolive's natural extracts and skin care positioning, as well as Protex brand which focuses on antibacterial protection for skin (“Company News”).
The decision to acquired Sanex validates Colgate-Palmolive strong potential for global market growth. According to Zacks Equity Research, Colgate-Palmolive recently sold $500 million worth of 10-year medium-term notes maturing in May, 2022 at a coupon rate of 2.30%, which is believed to be the lowest 10-year coupon rate. The company will use the funds to retire its old commercial paper. They believe the transaction will enhance the company’s financial flexibility while retaining focus on future growth prospects (Zacks,2012).
BCG Approach
With more than 200 years of experience Colgate-Palmolive is capable of answering questions such as, how exactly do they find out what lifecycle phase their products are in, and how do they classified what they sell? What products should they promote more than others? The BCG matrix helped them answers these questions. In a recent article titled “Colgate Palmolive Hungers Market Share In Oral Care Business,” published by Trefis Team analysts, the authors revealed the global economic position of Colgate products in accordance to their market share; this findings helped us determine Colgate’s product lines market share conditions for each of its product categories and place them in the BCG matrix as follow: * BCG STARS:
Colgate’s Oral Care division occupies more than a quarter of the global oral market and generates half of Colgate-Palmolive’s stock value. * Colgate Sensitive, Pro-Relief * Colgate Actibrush, Active Angle, Classic, Massager, Motion, Navigator, Plus, Total, Whitening, Wisp, Zig Zag * Elmex, Meridol
These products are considered Stars because they have high market share in a growing market. Stars are the leaders in the business, but because they are basically new products, they still need a lot of support promotion and placement; if their market share is kept, these products are likely to grow into cash cows. * BCG QUESTION MARKS
Market share of the manual toothbrush market is at 33.4% year to date, up 1.3 share points versus a year ago, including Colgate Wisp mini-brush whose market share is at 4.9% year to date. Colgate 360, ActiFlex, Colgate Max White and Colgate Extra Clean manual toothbrushes contributed to the share gains. For 2011, new introductions scheduled to hit store shelves during the first quarter include Colgate Total Gum Defense, Colgate MaxClean SmartFoam toothpastes, Colgate 360 Surround and Colgate Triple Action manual toothbrushes.
These products are in growing markets, these products are considered question marks because they are essentially new and buyers have yet to discover them, the marketing strategy is to get markets to adopt these products, these products need to increase their market share quickly or they become dogs. * BCG CASH COWS
The Global Market Size of Laundry Products increased from $41 billion in 2005 to almost $60 billion by the end of 2010. Going forward, financial analysts at Tetris expect it to grow at a 3% annual growth rate, reaching $81 billion by the end of the Trefis forecast period. This division represents the following fabric care brands manufactured and marketed by Colgate-Palmolive. * Suavitel: A fabric conditioner brand with leading market share in the Latin American market * Soupline: Another fabric conditioner brand with leading market share in European markets

* BCG DOGS
Trefis estimates that Colgate-Palmolive's Global Market Share of Hair Care decreased from 5.7% in 2008 to 5.4% in 2010 on account of an overall decline in consumer demand because of the recession and stiff competition from lower priced private labels and local brands. This resulted in Colgate losing market share.
Colgate-Palmolive sells shampoos and conditioners primarily under the Palmolive brand; these products are placed in the category of dog product, because they are in a low growth market and have low market share. * Palmolive Shampoos: Caprice, Kids, Naturals, Optims / Optima * Soaps * Palmolive Soaps: Aromatherapy, Naturals, Thermal Spa * Softsoap: Nutri Serums, Pure Cashmere * Tom's of Maine * Irish Spring * Protex * Pet food Science Diet Line
Colgate-Palmolive's Personal Care business globally includes the following brands of deodorants and antiperspirants.
•Speed Stick: Includes Mennen Speed Stick, 24/7, Power of Nature, Stainguard, Ultimate •Lady Speed Stick: Includes Lady Speed Stick Invisible Dry, Naturals •Tom's of Maine

Environmental Forces
Socio cultural forces
Understanding socio cultural forces is a prerequisite in order to successfully conducting business, especially in such a competitive market. In a corporation like Colgate Palmolive this forces greatly influence their marketing mix. Hence, in an international market socio cultural forces have an enormous effect on how marketers design their marketing strategies and approaches to customers.
Demographic and Diversity characteristics can lead to changes in how people live and ultimately influence their choices of products, brands, and spending behavior. When launching a new product or promoting existing ones, Colgate Palmolive have to take into account each one of them to successfully market its products and decrease its risk margin, population demographic focus on whether the product is gender neutral or not, how will it be promoted, does it appeal more to females or males?, what age group will be more interested in obtaining the product, and ways they can reach this market to let consumers know about the product.
Cultural values on the other hand, focus on the moral values and customs that may affect customer’s decisions and choices at the time of purchase. In an empirical study by Yong Zhang and Betsy D. Gelb the authors investigated the effects of advertising on consumers according to their culture and values, they concluded that: “Consumers grow up in a particular culture and become accustomed to that culture’s value systems, beliefs, and perception processes. Consequently, they respond to advertising messages that are congruent with their culture, rewarding advertisers who understand that culture and tailor ads to reflect its values” (Zhang , and Gelb 29-46.) In order to create a successful marketing strategy marketers need to fully understand these concepts, especially when marketing products globally. These can become great opportunities for marketers to engage in new markets or expand current ones, but it can also mean failure to those who fail to adapt to changes.
Technological Forces
Technology can sometimes be a key tool in maintaining competitive advantage. Social media has change the ways we communicate and market our products, making it easier for marketers to introduce new products to consumers and get almost instant feedback on products or ideas marketers introduced or are planning to introduce to consumers. It can also represent a threat when the disclosure of negative information about the product rapidly spread through social media. For a company like Colgate Palmolive technological forces can mean new ways to distribute their product and advertising as well. Maintaining a positive image and consistency in the quality of their products can minimize the risks of negative feedback.
Legal and regulatory Forces
A number of laws regulating consumer products have a great impact on what type of products Colgate Palmolive is able to distribute, but also legal and regulatory forces serves as a tool to protect their products and ideas from being stolen or imitated. Because Colgate Palmolive is a multinational corporation operating in more than 200 countries, the manufacturing, packaging, labeling, distribution, advertising and sale of the products are subject to extensive regulation which could have negative effects on the success of the company. For example, there are several products that may contain ingredients considered hazard for human consumption, a new regulation prohibiting the use of a specific substances or ingredients that will affect the distribution of a particular product containing such components. This could also lead to negative reaction from consumers of Colgate Palmolive products. Consequently, Colgate Palmolive must meet requirements for labeling their products accordingly with governmental regulations for each of the countries they operate in.
Competitive Forces
“Keep your friends close, and your enemies closer.” This quote is the perfect definition of describing Competitive forces. Almost every business has a rival, Pepsi vs. Coke, Menard’s vs. Lowes, and many others. Colgate is no exception; it has to deal with other companies such as P&G and Johnson & Johnsons, which produce substitutes products like Crest, Sensodyne, Arm and Hammer, among others. With all these potential competitors Colgate needs to constantly develop new products and new marketing strategies to make their products stand out to the consumers.
Economic Forces
Economic forces are one of the main evaluators of a business because it influences both customers and marketers. A little change in the economy can affect supply and demand, buying power, willingness to spend, and competitive behavior. In an article written by Dan Radovsky, he affirm that Colgate will reduce its global workforce by 6% over the next four years after it was reported that its third quarter worldwide revenue dipped 1%, this mean that just a 1% dip for a quarter will cost 2,300 people their jobs. A company like Colgate relies strongly on a customer’s buying power and willingness to spend, which will be affected by economic circumstances.
Political Forces
Political forces are very important to a company like Colgate-Palmolive, especially when doing business internationally; they may constitute a disadvantage when trying to engage in international trade and dealing with other countries’ regulations and laws. If Colgate is linked to people getting sick by using their products, one can guarantee that government officials are going to intervene. Consequently, political forces of the marketing environment have a great potential to influence marketing decisions and strategies.
SWOT Analysis Overview
Before looking at anything else, it is crucial to look at the internal strengths of Colgate. The company has a good reputation, particularly with oral health care, as well as having the bestselling toothpaste across the world. It also has very strong channels of distribution on a global scale. Colgate is a well-known brand with a very substantial market share. Colgate-Palmolive does not have as many internal weaknesses as it does strengths. However, that does not mean that there are none.
The Company takes full advantage of new marketing strategies, and the rebranding of its products to make them more appealing to customers. The ability of Colgate Palmolive to constantly monitor the market, represent an advantage to identify any new opportunities as soon as they arise. On the other hand, one of the biggest threat to Colgate is simply its competition, Aqua fresh and Crest are the major competitors of Colgate; both of their products are cheaper than Colgate products, and are equally recognized brands.
It is equally important to know where Colgate stands compared to two other major competitors in its industry such as P&G and Reckitt Benckiser; that is why we constructed a SWOT analysis of these two other competitor and compared it to Colgate’s in order to have a clear understanding of Colgate’s position in the current market.
Swot Analysis of two competitors
Swot Analysis Reckitt Benckiser Strengths
Strengths
* Excellent advertising and marketing * Globally available in 180 countries * Many employment opportunities * Well-known brands * Innovative approaches to new products * High research and development on some product lines * Many products have won product of the year awards * Operations in over 60 countries | Weaknesses * Strong competition * Not diversified * Some products have low research and development * Many fake products are being sold under name brand * Expired products being sold by retailors | Opportunities * Expanding product lines * Expanding service * Improve distribution system * Develop new product lines for the economy and rural areas | Threats * Competition * Competitors offering cheaper products * Competitors offering better packaging alternatives * Distribution of fake brands under their brand names * Legal and regulatory requirements may have a negative impact in their ability to sell their products in a competitive basis. * Potentially adverse taxation * Political instability or changing economic conditions |

Swot Analysis Procter & Gamble * Strengths
Strengths
300 brands that are available in 180 countries * Over 125,000 employees * 50% leadership brands that contribute 90% to it’s over all sales and profits * High exchange rate of stock * Billion dollars sales for around 24 brands * Many employment opportunities * Great at marketing and advertising | Weaknesses * A lot of competition from large domestic and international companies * Fake products are being sold under some of their name brands * Rely heavily on mature markets | Opportunities * Expanding into different product lines * Expanding in existing product lines * Acquisition of other companies * New brands for the economy class | Threats * Economic slowdown * Growing competition from other domestic and international brands * Growing competition with unbranded and local products |

Swot Analysis Colgate-Palmolive * Strengths
Strengths
Number one selling toothpaste * Good reputation * Trustworthy brands with over 200 years in the market * Excellent Advertising and brand visibility with a strong customer loyalty for brands | Weaknesses * Lack of new product ideas * Product recalls * Products in declining stage * Failing to understand other cultures and lifestyles in order to market products internationally * Pet food brands decreasing popularity | Opportunities * Rebranding products * Merging companies * New marketing opportunities * New Products * E-marketing * International expansion opportunities | Threats * Competition * Competitors offering cheaper products * Competitors offering better packaging alternatives * Distribution of fake brands under their brand names * Legal and regulatory requirements may have a negative impact in their ability to sell their products in a competitive basis. * Potentially adverse taxation * Political instability or changing economic conditions |

Strategic Analysis for Colgate-Palmolive
Priority #1
Decrease possibilities for Product recalls in the future
On June 14, 2007 there was a recall on toothpaste due to a “fake” product being distributed by outsiders. The fake product contained antifreeze. This was found in 4 states. Colgate announced the issue. Colgate was not very proactive to help the consumer and to keep contact with the consumer. The consumer at that point became dissatisfied with the Colgate Company. If Colgate had appointed someone to be in charge of the issue, made a plan, and executed the plan. They could have compensated the consumers, gave coupons to receive other Colgate products for free. This could have saved the reputation of the company.
On March 27, 2012 Colgate had a recall on the Colgate Motion, Colgate Motion Whitening and the Colgate 360 replaceable head powered toothbrushes. The battery gas built up. This was linked to the consumer’s use of the battery replacement. To resolve this issue Christopher Choi, PhD, DABT, the Sr. Research Scientist will need to develop a plan and research the matter fully and execute the plan with his team of scientists.
Priority #2
Create a research and development plan to come up with new product ideas that satisfy current market needs
In order to increase Colgate- Palmolive’s product lines and develop new products that will fit current market needs Mr. Christopher Choi, PhD in charge of Product research at Colgate-Palmolive will work together with Muhammad Zafar Iqbal marketing manager in creating and promoting this new product lines; expecting to increase sales and popularity by 10 percent respectively within the next two years or so.
Priority #3
Restructuring and re-branding Colgate’s current Pet food line currently managed by Hills Corporation
According to recent studies, having a pet might bring health benefits to the owners. It has been proven that having a pet can increase the owner’s socialization and also increase their owner’s opportunities for exercise and practice outdoor activities. Having a pet can help to decrease the owner’s feelings of loneliness. It can also help to decrease blood pressure, cholesterol levels and triglyceride levels. These changes in society are influencing people’s choice of product selection, and it is important for Colgate to keep their eyes open to these changes in order to increase their appeal to customers and improve their sales.
Due to new information about the ingredients and additives of pet food being available to the consumers, people are becoming more concerned about what they buy, not only for human consumption, but for their beloved pets too. They want to keep their pets healthier by feeding them better quality foods. They believe that by doing this it will increase the longevity of the pet’s life. Because people have become more attached to their pets and consider them part of their families it is important for Colgate Palmolive to understand these changes in their target market to serve their customers current needs.
After analyzing the current situation of Colgate-Palmolive’s Pet food line “Hill’s Science Diet” it is clearly that its sales volume has been substantially decreasing over the last few years; one of the factors contributing to this condition has been the bad reputation the product has received in the last few months. According to 175 reviews 88% of people gave Science Diet a one star on a scale of 1 to 5. Many of the people who gave Science Diet a one star complained about the recent change in the pet food formula for both cat and dog foods. People would say that once they changed to the new brand of Science Diet they saw their pets become sick within days; few people said their pet would stop eating the food completely and once they changed to another brand their pet would eat again.
Based on these facts it is clear that Colgate Palmolive is in need for developing a new product that will satisfy the needs of this new market trend. This is why our team will focus efforts in creating a strategic plan to address this issue to engage in a new business venture that will compliment Colgate’s existing method for marketing, selling, and promoting their pet food line.

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