Colgate Case
Colgate Case
Background/Summary
The case study involves the potential launch of Colgate Max Fresh (CMF), Colgate-Palmolive Company’s new product, performing considerably well in the United States. The company marketing the product is a multinational operating in 200 countries globally. The product has driven the company to a record 34/8% value share in significant United States markets (Quelch & Labatt-Randle 3). Nigel Burton, the company president, was launching the product in the global market in China and Mexico.
Issues/Desired Outcome
Burton faces a challenge in the decision to launch Colgate Max Fresh in the Chinese and Mexican markets, including the complexity of the decision. Research and development of the new product are huge investments since the company worked with CICs and resource-intensive technology. The firm spent considerable time and efforts to release the product in the target markets. Therefore, the product needed to perform well to pay back the invested finances (Quelch & Labatt-Randle 5). Launching the product in the new markets presents additional challenges for the company, including additional finances to support marketing and distribution and human resources to sell the product in the new market. Besides, the firm will spend millions of dollars on advertising the product in the global market. Thus, the decision creates an issue of whether the product will perform well enough in the target market to justify the complexity of international launch. The intended outcome for the company is to sell the product in the new market well enough to increase its revenue and profits and global market share.
Recommendations
Decisive. The new product has already succeeded in the US market. It could easily perform well in the international market with an effective strategy to reduce marketing costs and distribute the product. The decisive recommendation for the company is to continue with the launch in Mexico and China to improve its global operations.
Supported. CP already operated in 200 countries enabling it to make $10.6 billion global value. The company has some of the well-known brands in the Oral, Personal, and Home Case segments. Thus, Colgate Max Fresh will be joining the pipeline of other successful products in the global market. Besides, the product enters the oral care segment, leading to annual sales of $5.2 billion (Quelch & Labatt-Randle, 2007). The data shows that the product could perform well in the new markets.
Actionable. However, to achieve impressive performance, CP should conduct effective marketing to collect as much information as possible about the target markets to determine whether the launch is worth the investment. Market research would also ensure that the product and its marketing approaches meet local needs in the target market. The company could work with local marketers who understand their needs of consumers and can customize the product positioning, packaging, and marketing and distribution to local needs. Evidence-based decision-making is critical to ensure that the firm does not waste its finances and resources in a failing investment.
Reasonable. Besides, being a high-end market, advertising budget in the target markets is necessary to inform potential customers about the launch of the new product. Targeted ads should be aired in different media channels head of the launch to prepare customers.
Outcome. CP intends to increase its market for the new product to achieve returns on investment, increase its market share, and increase profitability. The company performs well in the market, especially in oral care. Therefore, with strategic approaches, the new product would succeed in Mexico and China.
