Colgate Max Fresh: Case Study

Introduction

This work focuses on the Colgate Max Fresh case study. It will begin with a critical analysis of the factors that led to the success of Colgate Max Fresh in the United States of America. This will be followed by an analysis of the adaptation strategies used to launch Colgate Max Fresh in Mexico and China. Finally, the presentation will recommend a marketing plan for launching Colgate Max Fresh as a global brand.

Factors that Led to CMF’s success in the USA

Colgate Max Fresh succeeded in the USA due to the following reasons. First, it was positioned as a premium brand with superior qualities. In particular, the brand guaranteed freshness and whitening of teeth. Additionally, its price was comparable to that of its closest competitor, CWE. Second, 73% of first year’s marketing budget was devoted to advertising in order to create awareness about the product. The adverts focused on communicating the unique attributes of the product such as its ability to enhance freshness of breath. In addition, CMF was endorsed by a celebrity (Emily Proctor), thereby improving its brand credibility. Finally, the product gained market share through marketing support activities such as TV program sponsorships and merchandizing. These activities encouraged consumer trial and repeat purchases.

Adaptation Strategies in China

The name ‘Colgate Max Fresh’ did not ring a bell in the minds of Chinese consumers. Consequently, the name was changed to ‘Icy Fresh’ in order to enhance brand recognition. Initially, the phrase ‘breath strips’ was used to position CMF as product that guaranteed fresh breath. However, the phrase was meaningless to Chinese. Thus, it was changed to ‘Cooling crystals’, thereby improving CMF’s brand personality. Similarly, Jay Chow, a Chinese celebrity who was associated with extreme living endorsed CMF, thereby improving its popularity. Finally, CMF was differentiated through the use of different flavors and graphics in order to meet the specific needs of the consumers. These adaptations made the product relevant to the Chinese market, thereby improving its sales.

Adaptation Strategies in Mexico

CMF was introduced in Mexico through a price reduction from 15.99 to 14.99 pesos in order to increase its sales volume by at least 25%. The adverts for the product were also adapted by using a new idea (a joy ride for the mouth). This enabled the marketers to connect with the Mexican consumers in a better way. Finally, the consumers suspected that CMF lacked therapeutic effects. Consequently, its marketers proposed the inclusion of therapeutic effects in order to reposition CMF as a premium brand.

Recommendations for New Market Entry

As a global brand, CMF can be launched in India through licensing. India is a good potential market for CMF because it has a large population with a high purchasing power. In this regard, the sales volume of CMF is likely to be high. Licensing can be a suitable entry mode because it requires little time to join the new market. This is because India has a large number of oral care manufacturers who produce private label (toothpaste brands) on behalf of international firms. Additionally, licensing will improve the competitiveness of CMF by enabling it to avoid high import duties.

CMF can also be introduced in South Africa through franchising. The product is likely to succeed in South Africa because Colgate-Palmolive already commands 41% market share in the country. In this regard, the company’s existing distribution channel can be used to launch CMF in the market. Additionally, South Africa’s niche market for oral care products has a strong growth. Thus, demand for CMF is likely to be high.

Marketing Plan: Price

CMF should be launched in India and South Africa through penetration pricing strategy due to the following reasons. First, the competition in both markets is very high. Thus, low prices will enable CMF to penetrate the market easily. Second, India and South Africa are mature markets. Thus, charging high prices will limit sales. Finally, consumers in both markets are responsive to prices. Thus, low prices will help in attracting and retaining customers.

Marketing Strategy: Product

Differentiation strategies should focus on adapting the product to the needs of each market. This is because consumers in India and South Africa are likely to have tastes and preferences that are different from those of their American counterparts. For example, the marketers can launch CMF in various flavors. Effective differentiation will position the product as a high quality brand, thereby enabling it to overcome competition and to ensure customer loyalty.

Marketing Strategy: Promotion

Promotional activities can only be effective if they are relevant to the markets in which they are used. Thus, it will be advisable to use local celebrities who are well known to consumers in India and South Africa to endorse CMF. Similarly, it is advisable to use local advertising agencies to create adverts for CMF. This is because local agencies are likely to have adequate knowledge about the markets. Thus, they are likely to develop the most appropriate adverts for the product.

Reference

Euromonitor 2012, Oral Care in South Africa. Web.