Case Study Description of Colgate: Regaining Leadership in India's Sensitive Teeth Market
In April 2013, Colgate-Palmolive, a long-term front runner in a consumer goods business that specialized in oral care products, lost its dominance for the sensitive teeth toothpaste market in India. It was a dominance that Colgate-Palmolive had managed to build over the years by being a first mover and by leveraging its reputation as a leader in oral care products. However, new global and local competitors entered the market with diverse product variants and aggressive marketing campaigns, and started to erode the company's market share. By mid-2013, the fight for market share was fierce and on the verge of becoming even more intense. Could Colgate-Palmolive regain its dominance? How should the company navigate these extremely competitive tides to regain its lost market share? Doreen Kum is affiliated with NUS Business School.
Swot Analysis of "Colgate: Regaining Leadership in India's Sensitive Teeth Market" written by Doreen Kum includes – strengths weakness that are internal strategic factors of the organization, and opportunities and threats that Colgate Palmolive facing as an external strategic factors. Some of the topics covered in Colgate: Regaining Leadership in India's Sensitive Teeth Market case study are - Strategic Management Strategies, Customers, Emerging markets and Sales & Marketing.
Some of the macro environment factors that can be used to understand the Colgate: Regaining Leadership in India's Sensitive Teeth Market casestudy better are - – cloud computing is disrupting traditional business models, there is increasing trade war between United States & China, banking and financial system is disrupted by Bitcoin and other crypto currencies, supply chains are disrupted by pandemic , competitive advantages are harder to sustain because of technology dispersion, digital marketing is dominated by two big players Facebook and Google, increasing household debt because of falling income levels,
central banks are concerned over increasing inflation, increasing energy prices, etc
Introduction to SWOT Analysis of Colgate: Regaining Leadership in India's Sensitive Teeth Market
SWOT stands for an organization’s Strengths, Weaknesses, Opportunities and Threats . At Oak Spring University , we believe that protagonist in Colgate: Regaining Leadership in India's Sensitive Teeth Market case study can use SWOT analysis as a strategic management tool to assess the current internal strengths and weaknesses of the Colgate Palmolive, and to figure out the opportunities and threats in the macro environment – technological, environmental, political, economic, social, demographic, etc in which Colgate Palmolive operates in.
According to Harvard Business Review, 75% of the managers use SWOT analysis for various purposes such as – evaluating current scenario, strategic planning, new venture feasibility, personal growth goals, new market entry, Go To market strategies, portfolio management and strategic trade-off assessment, organizational restructuring, etc.
SWOT Objectives / Importance of SWOT Analysis and SWOT Matrix
SWOT analysis of Colgate: Regaining Leadership in India's Sensitive Teeth Market can be done for the following purposes –
1. Strategic planning using facts provided in Colgate: Regaining Leadership in India's Sensitive Teeth Market case study
2. Improving business portfolio management of Colgate Palmolive
3. Assessing feasibility of the new initiative in Sales & Marketing field.
4. Making a Sales & Marketing topic specific business decision
5. Set goals for the organization
6. Organizational restructuring of Colgate Palmolive
Strengths Colgate: Regaining Leadership in India's Sensitive Teeth Market | Internal Strategic Factors
What are Strengths in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The strengths of Colgate Palmolive in Colgate: Regaining Leadership in India's Sensitive Teeth Market Harvard Business Review case study are -
Sustainable margins compare to other players in Sales & Marketing industry
– Colgate: Regaining Leadership in India's Sensitive Teeth Market firm has clearly differentiated products in the market place. This has enabled Colgate Palmolive to fetch slight price premium compare to the competitors in the Sales & Marketing industry. The sustainable margins have also helped Colgate Palmolive to invest into research and development (R&D) and innovation.
Strong track record of project management
– Colgate Palmolive is known for sticking to its project targets. This enables the firm to manage – time, project costs, and have sustainable margins on the projects.
Digital Transformation in Sales & Marketing segment
- digital transformation varies from industry to industry. For Colgate Palmolive digital transformation journey comprises differing goals based on market maturity, customer technology acceptance, and organizational culture. Colgate Palmolive has successfully integrated the four key components of digital transformation – digital integration in processes, digital integration in marketing and customer relationship management, digital integration into the value chain, and using technology to explore new products and market opportunities.
Successful track record of launching new products
– Colgate Palmolive has launched numerous new products in last few years, keeping in mind evolving customer preferences and competitive pressures. Colgate Palmolive has effective processes in place that helps in exploring new product needs, doing quick pilot testing, and then launching the products quickly using its extensive distribution network.
Analytics focus
– Colgate Palmolive is putting a lot of focus on utilizing the power of analytics in business decision making. This has put it among the leading players in the industry. The technology infrastructure suggested by Doreen Kum can also help it to harness the power of analytics for – marketing optimization, demand forecasting, customer relationship management, inventory management, information sharing across the value chain etc.
Cross disciplinary teams
– Horizontal connected teams at the Colgate Palmolive are driving operational speed, building greater agility, and keeping the organization nimble to compete with new competitors. It helps are organization to ideate new ideas, and execute them swiftly in the marketplace.
Organizational Resilience of Colgate Palmolive
– The covid-19 pandemic has put organizational resilience at the centre of everthing that Colgate Palmolive does. Organizational resilience comprises - Financial Resilience, Operational Resilience, Technological Resilience, Organizational Resilience, Business Model Resilience, and Reputation Resilience.
Operational resilience
– The operational resilience strategy in the Colgate: Regaining Leadership in India's Sensitive Teeth Market Harvard Business Review case study comprises – understanding the underlying the factors in the industry, building diversified operations across different geographies so that disruption in one part of the world doesn’t impact the overall performance of the firm, and integrating the various business operations and processes through its digital transformation drive.
High brand equity
– Colgate Palmolive has strong brand awareness and brand recognition among both - the exiting customers and potential new customers. Strong brand equity has enabled Colgate Palmolive to keep acquiring new customers and building profitable relationship with both the new and loyal customers.
Superior customer experience
– The customer experience strategy of Colgate Palmolive in the segment is based on four key concepts – personalization, simplification of complex needs, prompt response, and continuous engagement.
Diverse revenue streams
– Colgate Palmolive is present in almost all the verticals within the industry. This has provided firm in Colgate: Regaining Leadership in India's Sensitive Teeth Market case study a diverse revenue stream that has helped it to survive disruptions such as global pandemic in Covid-19, financial disruption of 2008, and supply chain disruption of 2021.
Ability to recruit top talent
– Colgate Palmolive is one of the leading recruiters in the industry. Managers in the Colgate: Regaining Leadership in India's Sensitive Teeth Market are in a position to attract the best talent available. The firm has a robust talent identification program that helps in identifying the brightest.
Weaknesses Colgate: Regaining Leadership in India's Sensitive Teeth Market | Internal Strategic Factors
What are Weaknesses in SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The weaknesses of Colgate: Regaining Leadership in India's Sensitive Teeth Market are -
Low market penetration in new markets
– Outside its home market of Colgate Palmolive, firm in the HBR case study Colgate: Regaining Leadership in India's Sensitive Teeth Market needs to spend more promotional, marketing, and advertising efforts to penetrate international markets.
Lack of clear differentiation of Colgate Palmolive products
– To increase the profitability and margins on the products, Colgate Palmolive needs to provide more differentiated products than what it is currently offering in the marketplace.
No frontier risks strategy
– After analyzing the HBR case study Colgate: Regaining Leadership in India's Sensitive Teeth Market, it seems that company is thinking about the frontier risks that can impact Sales & Marketing strategy. But it has very little resources allocation to manage the risks emerging from events such as natural disasters, climate change, melting of permafrost, tacking the rise of artificial intelligence, opportunities and threats emerging from commercialization of space etc.
Ability to respond to the competition
– As the decision making is very deliberative, highlighted in the case study Colgate: Regaining Leadership in India's Sensitive Teeth Market, in the dynamic environment Colgate Palmolive has struggled to respond to the nimble upstart competition. Colgate Palmolive has reasonably good record with similar level competitors but it has struggled with new entrants taking away niches of its business.
Increasing silos among functional specialists
– The organizational structure of Colgate Palmolive is dominated by functional specialists. It is not different from other players in the Sales & Marketing segment. Colgate Palmolive needs to de-silo the office environment to harness the true potential of its workforce. Secondly the de-silo will also help Colgate Palmolive to focus more on services rather than just following the product oriented approach.
Products dominated business model
– Even though Colgate Palmolive has some of the most successful products in the industry, this business model has made each new product launch extremely critical for continuous financial growth of the organization. firm in the HBR case study - Colgate: Regaining Leadership in India's Sensitive Teeth Market should strive to include more intangible value offerings along with its core products and services.
High dependence on star products
– The top 2 products and services of the firm as mentioned in the Colgate: Regaining Leadership in India's Sensitive Teeth Market HBR case study still accounts for major business revenue. This dependence on star products in has resulted into insufficient focus on developing new products, even though Colgate Palmolive has relatively successful track record of launching new products.
High bargaining power of channel partners
– Because of the regulatory requirements, Doreen Kum suggests that, Colgate Palmolive is facing high bargaining power of the channel partners. So far it has not able to streamline the operations to reduce the bargaining power of the value chain partners in the industry.
Capital Spending Reduction
– Even during the low interest decade, Colgate Palmolive has not been able to do capital spending to the tune of the competition. This has resulted into fewer innovations and company facing stiff competition from both existing competitors and new entrants who are disrupting the industry using digital technology.
Slow decision making process
– As mentioned earlier in the report, Colgate Palmolive has a very deliberative decision making approach. This approach has resulted in prudent decisions, but it has also resulted in missing opportunities in the industry over the last five years. Colgate Palmolive even though has strong showing on digital transformation primary two stages, it has struggled to capitalize the power of digital transformation in marketing efforts and new venture efforts.
High operating costs
– Compare to the competitors, firm in the HBR case study Colgate: Regaining Leadership in India's Sensitive Teeth Market has high operating costs in the. This can be harder to sustain given the new emerging competition from nimble players who are using technology to attract Colgate Palmolive 's lucrative customers.
Opportunities Colgate: Regaining Leadership in India's Sensitive Teeth Market | External Strategic Factors
What are Opportunities in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The opportunities highlighted in the Harvard Business Review case study Colgate: Regaining Leadership in India's Sensitive Teeth Market are -
Creating value in data economy
– The success of analytics program of Colgate Palmolive has opened avenues for new revenue streams for the organization in the industry. This can help Colgate Palmolive to build a more holistic ecosystem as suggested in the Colgate: Regaining Leadership in India's Sensitive Teeth Market case study. Colgate Palmolive can build new products and services such as - data insight services, data privacy related products, data based consulting services, etc.
Manufacturing automation
– Colgate Palmolive can use the latest technology developments to improve its manufacturing and designing process in Sales & Marketing segment. It can use CAD and 3D printing to build a quick prototype and pilot testing products. It can leverage automation using machine learning and artificial intelligence to do faster production at lowers costs, and it can leverage the growth in satellite and tracking technologies to improve inventory management, transportation, and shipping.
Harnessing reconfiguration of the global supply chains
– As the trade war between US and China heats up in the coming years, Colgate Palmolive can build a diversified supply chain model across various countries in - South East Asia, India, and other parts of the world. This reconfiguration of global supply chain can help, as suggested in case study, Colgate: Regaining Leadership in India's Sensitive Teeth Market, to buy more products closer to the markets, and it can leverage its size and influence to get better deal from the local markets.
Lowering marketing communication costs
– 5G expansion will open new opportunities for Colgate Palmolive in the field of marketing communication. It will bring down the cost of doing business, provide technology platform to build new products in the Sales & Marketing segment, and it will provide faster access to the consumers.
Remote work and new talent hiring opportunities
– The widespread usage of remote working technologies during Covid-19 has opened opportunities for Colgate Palmolive to expand its talent hiring zone. According to McKinsey Global Institute, 20% of the high end workforce in fields such as finance, information technology, can continously work from remote local post Covid-19. This presents a really great opportunity for Colgate Palmolive to hire the very best people irrespective of their geographical location.
Learning at scale
– Online learning technologies has now opened space for Colgate Palmolive to conduct training and development for its employees across the world. This will result in not only reducing the cost of training but also help employees in different part of the world to integrate with the headquarter work culture, ethos, and standards.
Increase in government spending
– As the United States and other governments are increasing social spending and infrastructure spending to build economies post Covid-19, Colgate Palmolive can use these opportunities to build new business models that can help the communities that Colgate Palmolive operates in. Secondly it can use opportunities from government spending in Sales & Marketing sector.
Better consumer reach
– The expansion of the 5G network will help Colgate Palmolive to increase its market reach. Colgate Palmolive will be able to reach out to new customers. Secondly 5G will also provide technology framework to build new tools and products that can help more immersive consumer experience and faster consumer journey.
Identify volunteer opportunities
– Covid-19 has impacted working population in two ways – it has led to people soul searching about their professional choices, resulting in mass resignation. Secondly it has encouraged people to do things that they are passionate about. This has opened opportunities for businesses to build volunteer oriented socially driven projects. Colgate Palmolive can explore opportunities that can attract volunteers and are consistent with its mission and vision.
Using analytics as competitive advantage
– Colgate Palmolive has spent a significant amount of money and effort to integrate analytics and machine learning into its operations in the sector. This continuous investment in analytics has enabled, as illustrated in the Harvard case study Colgate: Regaining Leadership in India's Sensitive Teeth Market - to build a competitive advantage using analytics. The analytics driven competitive advantage can help Colgate Palmolive to build faster Go To Market strategies, better consumer insights, developing relevant product features, and building a highly efficient supply chain.
Use of Bitcoin and other crypto currencies for transactions
– The popularity of Bitcoin and other crypto currencies as asset class and medium of transaction has opened new opportunities for Colgate Palmolive in the consumer business. Now Colgate Palmolive can target international markets with far fewer capital restrictions requirements than the existing system.
Leveraging digital technologies
– Colgate Palmolive can leverage digital technologies such as artificial intelligence and machine learning to automate the production process, customer analytics to get better insights into consumer behavior, realtime digital dashboards to get better sales tracking, logistics and transportation, product tracking, etc.
Reconfiguring business model
– The expansion of digital payment system, the bringing down of international transactions costs using Bitcoin and other blockchain based currencies, etc can help Colgate Palmolive to reconfigure its entire business model. For example it can used blockchain based technologies to reduce piracy of its products in the big markets such as China. Secondly it can use the popularity of e-commerce in various developing markets to build a Direct to Customer business model rather than the current Channel Heavy distribution network.
Threats Colgate: Regaining Leadership in India's Sensitive Teeth Market External Strategic Factors
What are Threats in the SWOT Analysis / TOWS Matrix / Weighted SWOT Analysis
The threats mentioned in the HBR case study Colgate: Regaining Leadership in India's Sensitive Teeth Market are -
Technology disruption because of hacks, piracy etc
– The colonial pipeline illustrated, how vulnerable modern organization are to international hackers, miscreants, and disruptors. The cyber security interruption, data leaks, etc can seriously jeopardize the future growth of the organization.
Stagnating economy with rate increase
– Colgate Palmolive can face lack of demand in the market place because of Fed actions to reduce inflation. This can lead to sluggish growth in the economy, lower demands, lower investments, higher borrowing costs, and consolidation in the field.
Aging population
– As the populations of most advanced economies are aging, it will lead to high social security costs, higher savings among population, and lower demand for goods and services in the economy. The household savings in US, France, UK, Germany, and Japan are growing faster than predicted because of uncertainty caused by pandemic.
Environmental challenges
– Colgate Palmolive needs to have a robust strategy against the disruptions arising from climate change and energy requirements. EU has identified it as key priority area and spending 30% of its 880 billion Euros European post Covid-19 recovery funds on green technology. Colgate Palmolive can take advantage of this fund but it will also bring new competitors in the Sales & Marketing industry.
Technology acceleration in Forth Industrial Revolution
– Colgate Palmolive has witnessed rapid integration of technology during Covid-19 in the Sales & Marketing industry. As one of the leading players in the industry, Colgate Palmolive needs to keep up with the evolution of technology in the Sales & Marketing sector. According to Mckinsey study top managers believe that the adoption of technology in operations, communications is 20-25 times faster than what they planned in the beginning of 2019.
Easy access to finance
– Easy access to finance in Sales & Marketing field will also reduce the barriers to entry in the industry, thus putting downward pressure on the prices because of increasing competition. Colgate Palmolive can utilize it by borrowing at lower rates and invest it into research and development, capital expenditure to fortify its core competitive advantage.
Increasing international competition and downward pressure on margins
– Apart from technology driven competitive advantage dilution, Colgate Palmolive can face downward pressure on margins from increasing competition from international players. The international players have stable revenue in their home market and can use those resources to penetrate prominent markets illustrated in HBR case study Colgate: Regaining Leadership in India's Sensitive Teeth Market .
Instability in the European markets
– European Union markets are facing three big challenges post Covid – expanded balance sheets, Brexit related business disruption, and aggressive Russia looking to distract the existing security mechanism. Colgate Palmolive will face different problems in different parts of Europe. For example it will face inflationary pressures in UK, France, and Germany, balance sheet expansion and demand challenges in Southern European countries, and geopolitical instability in the Eastern Europe.
Regulatory challenges
– Colgate Palmolive needs to prepare for regulatory challenges as consumer protection groups and other pressure groups are vigorously advocating for more regulations on big business - to reduce inequality, to create a level playing field, to product data privacy and consumer privacy, to reduce the influence of big money on democratic institutions, etc. This can lead to significant changes in the Sales & Marketing industry regulations.
Consumer confidence and its impact on Colgate Palmolive demand
– There is a high probability of declining consumer confidence, given – high inflammation rate, rise of gig economy, lower job stability, increasing cost of living, higher interest rates, and aging demography. All the factors contribute to people saving higher rate of their income, resulting in lower consumer demand in the industry and other sectors.
High dependence on third party suppliers
– Colgate Palmolive high dependence on third party suppliers can disrupt its processes and delivery mechanism. For example -the current troubles of car makers because of chip shortage is because the chip companies started producing chips for electronic companies rather than car manufacturers.
Shortening product life cycle
– it is one of the major threat that Colgate Palmolive is facing in Sales & Marketing sector. It can lead to higher research and development costs, higher marketing expenses, lower customer loyalty, etc.
Learning curve for new practices
– As the technology based on artificial intelligence and machine learning platform is getting complex, as highlighted in case study Colgate: Regaining Leadership in India's Sensitive Teeth Market, Colgate Palmolive may face longer learning curve for training and development of existing employees. This can open space for more nimble competitors in the field of Sales & Marketing .
Weighted SWOT Analysis of Colgate: Regaining Leadership in India's Sensitive Teeth Market Template, Example
Not all factors mentioned under the Strengths, Weakness, Opportunities, and Threats quadrants in the SWOT Analysis are equal. Managers in the HBR case study Colgate: Regaining Leadership in India's Sensitive Teeth Market needs to zero down on the relative importance of each factor mentioned in the Strengths, Weakness, Opportunities, and Threats quadrants.
We can provide the relative importance to each factor by assigning relative weights. Weighted SWOT analysis process is a three stage process –
First stage for doing weighted SWOT analysis of the case study Colgate: Regaining Leadership in India's Sensitive Teeth Market is to rank the strengths and weaknesses of the organization. This will help you to assess the most important strengths and weaknesses of the firm and which one of the strengths and weaknesses mentioned in the initial lists are marginal and can be left out.
Second stage for conducting weighted SWOT analysis of the Harvard case study Colgate: Regaining Leadership in India's Sensitive Teeth Market is to give probabilities to the external strategic factors thus better understanding the opportunities and threats arising out of macro environment changes and developments.
Third stage of constructing weighted SWOT analysis of Colgate: Regaining Leadership in India's Sensitive Teeth Market is to provide strategic recommendations includes – joining likelihood of external strategic factors such as opportunities and threats to the internal strategic factors – strengths and weaknesses. You should start with external factors as they will provide the direction of the overall industry. Secondly by joining probabilities with internal strategic factors can help the company not only strategic fit but also the most probably strategic trade-off that Colgate Palmolive needs to make to build a sustainable competitive advantage.
