STP Report

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A PROJECT REPORT ON SEGMENTATION TARGETING AND POSITIONING OF Colgate-Palmolive Ltd. Submitted To:- Submitted By:- PGDM-Marketing. Page 1

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Report on Colgate.

Transcript of STP Report

A PROJECT REPORT ON SEGMENTATION TARGETING AND POSITIONING OF

Colgate-Palmolive Ltd.

Submitted To:- Submitted By:-

Dr. Nimit Gupta. Group No. 5.

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Certificate

This is to certify that the project report on the topic “Segmentation,Targeting & Positioning Of Colgate” submitted by Group No. 5 in fulfillment of the requirements of the academics structure for PGDM-Marketing degree is a bonafide record of the work done by all of us under the guidance of Dr. Nimit Gupta.

Submitted To:- Seal Of The Institution:-

Dr. Nimit Gupta.

Signature:-

Date:- 15th September,2014.

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ACKNOWLEDGEMENT

This project is a result of dedicated effort. It gives us

immense pleasure to prepare this project report on

“SEGMENTATION, TARGETING AND POSITIONING

DONE BY COLGATE”.

We would like to thank our project guide, Dr. Nimit

Gupta, for consultative help and constructive

suggestion on the matter in this project. We would like

to thank our study group members who have helped us

in making this project a successful one.

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INDEX

S. No. CONTENTS. Page No.

1. COMPANY PROFILE. 5

2. INTRODUCTION. 7

3. WHAT IS SEGMENTATION? 8

4. HOW COLGATE SEGMENT MARKET. 11

5. WHAT IS TARGETING. 12

6. HOW COLGATE TARGET MARKET. 15

7. WHAT IS POSITIONING. 16

8. HOW COLGATE POSITION THE PRODUCT. 18

9. PRODUCT MIX. 20

10. MARKETING MIX. 21

11. PRODUCT. 22

12. PRICE. 23

13. PLACE. 24

14. PROMOTION. 25

15. CONCLUSION. 26

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COMPANY PROFILE

Company Name :- Colgate Palmolive Ltd.

Date of Establishment:- 1937.

Revenue:- 347.188 (USD in Millions).

Market Capital:- 111160.5286158 (Rs. In Millions).

Corporate Address:- Colgate Research Centre, Main Street, Hiranandani Gardens, Powai, Mumbai-400076. Maharashtra.

Website:- www.colgate.co.in

Management Details:- Chair Person:- Mr. J Skala.

M.D:- Mr. R. D Calmeyer.

Directors:- Derrick Samuel, J K Setna, Skala,

K.V.Vaidyanathan, M.Elias, P.K

Ghosh, R.A Shah, V.S Mehta.

Business Operation:- Household & Personal Products.

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Background:- Colgate-Palmolive is Rs 1,300 Crore company.

Started in year 1937. In Rs 2,400 Crore

domestic market, it enjoys 50% of market’s

share. It spread across 4.5 Million retail

outlets, out of which 1.5 Million are direct

outlets.

Financials:- Total Income – Rs. 20606.60 Million.

Net Profit – Rs 4232.60 Million.

Company Secretary:- K.V.Vaidyanathan.

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INTRODUCTION

Colgate – Palmolive Company is an American diversified multinational corporation focused on the production, distribution and provision of household, healthcare and personal products, such as soaps, detergents, and oral hygiene products (including toothpaste and toothbrushes).

Under its “Hills” brand, it is also a manufacturer of veterinary products. The company’s corporate offices are on Park Avenue in New York City, across from the Walder of Astoria.

In India, it operates under the name as Colgate-Palmolive (India) limited and its head office is at Mumbai.

Colgate Palmolive is a $10.6 billion global company serving people in more than 200 countries and territories with consumer products that make lives healthier and more enjoyable.

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WHAT IS SEGMENTATION.?

Market segmentation is a marketing strategy that involves dividing a broad target market into subsets of consumers who have common needs and priorities, and then designing and implementing strategies to target them. Market segmentation strategies may be used to identify the target customers, and provide supporting data for positioning to achieve a marketing plan objective. Businesses may develop product differentiation strategies, or an undifferentiated approach, involving specific products or product lines depending on the specific demand and attributes of the target segment.

Criteria for segmenting:-

An ideal market segment meets all of the following criteria:

It is possible to measure. It must be large enough to earn profit. It must be stable enough that it does not vanish after some

time. It is possible to reach potential customers via the

organization's promotion and distribution channel. It is internally homogeneous (potential customers in the

same segment prefer the same product qualities). It is externally heterogeneous(potential customers from

different segments have different quality preferences). It responds consistently to a given market stimulus. It can be reached by market intervention in a cost-effective

manner. It is useful in deciding on the marketing mix.

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It identifies the target customer(s) (surrogate(s)). It provides supporting data for a market positioning or sales

approach.

Methods Of Market Segmentation:-

Geographic Segmentation:-

Marketers can segment according to geographic criteria—nations, states, regions, countries, languages, cities, neighborhoods, or postal codes. The geo-cluster approach combines demographic data with geographic data to create a more accurate or specific profile.With respect to region, in rainy regions merchants can sell things like raincoats, umbrellas and gumboots. In hot regions, one can sell summer clothing. A small business commodity store may target only customers from the local neighborhood, while a larger department store can target its marketing towards several neighborhoods in a larger city or area, while ignoring customers in other continents. Geographic Segmentation is important and may be considered the first step to international marketing, followed by demographic and psychographic segmentation. The use of national boarders is the institutional use of geographic segmentation, although geographic segments may be classified by identified geological regions.

Demographic Segmentation:-

Demographic segmentation is dividing markets into different groups according to their age, gender, the amount of income, the ethnicity or religion of the market and the family life cycle.

Behavioral Segmentation:-

Behavioral segmentation divides consumers into groups according to their knowledge of, attitude towards, usage rate or response to a

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product. There is an extra connectivity with all other market related sources.

Psychographic Segmentation:-

Psychographic segmentation, which is sometimes called Lifestyle. This is measured by studying the activities, interests, and opinions (AIOs) of customers. It considers how people spend their leisure, and which external influences they are most responsive to and influenced by. Psychographic is highly important to segmentation, because it identifies the personal activities and targeted lifestyle the target subject endures, or the image they are attempting to project. Mass Media has a predominant influence and effect on Psychographic segmentation. Lifestyle products may pertain to high involvement products and purchase decisions, to speciality or luxury products and purchase decisions. Lifestyle segmentation reflects on how the target subject identifies themselves, or how they desire to identify themselves in society. By identifying and understanding consumer lifestyle, businesses can develop promotional mixes and product lines, which tailor to their needs.

Segmentation according to occasions relies on the special needs and desires of consumers on various occasions - for example, for products for use in relation with a certain holiday. Products such as decorations or lamps are marketed almost exclusively in the time leading up to the related event, and will not generally be available all year round. Another type of occasional market segments are people preparing for a wedding or a funeral, occasions which only occur a few times in a person's lifetime, but which happen so often in a large population that ongoing general demand makes for a worthwhile market segment.

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HOW COLGATE SEGMENT MARKET.?

Colgate’s market segmentation is very broad because all their products are of need to most people so those people share a similar interest in product needs.

Colgate uses a segmentation bases by knowing that certain groups of people need Colgate toothpaste for a specific similar reason like yellow teeth, sensitive teeth or just teeth with cavities.

Colgate also uses the family life cycle because they make toothpaste that could be used for grownups and children.

Also, toothbrushes are made to attract young children with cartoon characters and different tastes and are less strong so that it wouldn’t damage their gums.

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WHAT IS TARGETING.?

A target market is a group of customers towards which a business has decided to aim its marketing efforts and ultimately its merchandise. A well-defined target market is the first element to a marketing strategy. The marketing mix variables of product, place (distribution), promotion and price are the four elements of a marketing mix strategy that determine the success of a product in the marketplace.

Target Markets:-

Target markets are groups of individuals that are separated by distinguishable and noticeable aspects. Target markets can be separated by the following aspects:

Segmentations - addresses (their location climate region). Demographic/socioeconomic segmentation - (gender, age,

income, occupation, education, household size, and stage in the family life cycle).

Psychographic segmentation - (similar attitudes, values, and lifestyles).

Behavioral segmentation - (occasions, degree of loyalty). Product-related segmentation - (relationship to a product).

In addition to these segmentations, market researchers have advocated a needs-based market segmentation approach to identify smaller and better defined target groups. Some approaches to these smaller groups are:

Select the target audience – the customers are grouped based on similar needs and benefits sought by them on purchase of a product.

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Identify clusters of similar needs – demographics, lifestyle, usage behavior and pattern used to differentiate between segments.

Apply a valuation approach – market growth, barriers to entry, market access, switching, etc. are used.

Test the segments – A segment storyboard is to be created to test the attractiveness of each segment’s positioning strategy.

Modify marketing mix – expanding segment positioning strategy to include all aspects of marketing mix.

Strategies for Reaching Target Markets:-

Marketers have outlined four basic strategies to satisfy target markets: undifferentiated marketing or mass marketing, differentiated marketing, concentrated marketing, and micromarketing/ niche marketing.

Mass Marketing:-

A market coverage strategy in which a firm decides to ignore market segment differences and go after the whole market with one offer. It is the type of marketing (or attempting to sell through persuasion) of a product to a wide audience. The idea is to broadcast a message that will reach the largest number of people possible. Traditionally mass marketing has focused on radio, television and newspapers as the medium used to reach this broad audience.

Differentiated Marketing Strategy:-

One where the company decides to provide separate offerings to each different market segment that it targets. It is also called multi segment marketing and as is clearly seen that it tries to appeal to multiple segments in the market. Each segment is targeted uniquely as the company provides unique benefits to different segments. It increases the total sales but at the expense of increase in the cost of investing in the business.

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Concentrated Marketing:-

A strategy which targets very defined and specific segments of the consumer. It is particularly effective for small companies with limited resources as it does not believe in the use of mass production, mass distribution and mass advertising. There is no increase in the total profits of the sales as it targets just one segment of the market.

Direct Marketing:-

For sales teams, one way to reach out to target markets is through direct marketing. This is done by buying consumer database based on the defined segmentation profiles. These database usually comes with consumer contacts (e.g., email, mobile no., home no., etc.).

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HOW DOES COLGATE TARGET.?

MAX FRESH:- Colgate targeted youth with the introduction of this toothpaste, as this helps in refreshes breath.

ACTIVE SALT:- Elder people are targeted in this segment as it makes teeth stronger and provides protection from cavities.

COLGATE TOTAL:- Colgate Total contains the anti-microbial ingredient triclosan, which reduces the number of bacteria that cause gingivitis, cavities and halitosis. Basically, it’s for kids but Mothers are targeted as they are very concerned about their kids. This toothpaste safeguards teeth for 12 hours.

COLGATE SENSITIVE:- People who have sensitive teeth are targeted in this segment who have problem in their gums.

KIDS TOOTHPASTE:- Often small children don’t like to brush teeth, so for them this toothpaste was launched. Colgate had focused on taste aspect to encourage kids to brush teeth.

COLGATE WHITENING:- A whitening toothpaste that is "Clinically-proven to whiten in 14 days”. Its whitening ingredient is hydrogen peroxide, which gradually bleaches the teeth. Focus is given on group of customers in this segment those who are already suffering from plaque in their teeth.

COLGATE 2 in 1:- People who want both strongness and fresh breath are targeted.

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WHAT IS POSITIONING.?Positioning is the marketing activity and process of identifying a market problem or opportunity, and developing a solution based on market research, segmentation and supporting data. Positioning may refer the position a business has chosen to carry out their marketing and business objectives. Positioning relates to strategy, in the specific or tactical development phases of carrying out an objective to achieve a business' or organization's goals, such as increasing sales volume, brand recognition, or reach in advertising.

Brand Positioning Process:-

Effective Brand Positioning is contingent upon identifying and communicating a brand's uniqueness, differentiation and verifiable value. It is important to note that "me too" brand positioning contradicts the notion of differentiation and should be avoided at all costs. This type of copycat brand positioning only works if the business offers its solutions at a significant discount over the other competitors.

Generally, the brand positioning process involves:

1. Identifying the business's direct competition (could include players that offer your product/service amongst a larger portfolio of solutions).

2. Understanding how each competitor is positioning their business today (e.g. claiming to be the fastest, cheapest, largest, the #1 provider, etc.).

3. Documenting the provider's own positioning as it exists today (may not exist if startup business).

4. Comparing the company's positioning to its competitors' to identify viable areas for differentiation.

5. Developing a distinctive, differentiating and value-based positioning concept.

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6. Creating a positioning statement with key messages and customer value propositions to be used for communications development across the organization.

Product Positioning Process:-

Generally, the product positioning process involves:-

1) Defining the market in which the product or brand will compete (who the relevant buyers are).

2) Identifying the attributes (also called dimensions) that define the product 'space'.

3) Collecting information from a sample of customers about their perceptions of each product on the relevant attributes.

4) Determine each product's share of mind.5) Determine each product's current location in the product space.6) Determine the target market's preferred combination of

attributes.7) Examine the fit between the product and the market.

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HOW DOES COLGATE POSITION’S ITS PRODUCT?

Colgate dental cream positions itself as toothpaste that has the necessary calcium and minerals to provide decay protection, strong teeth, germ protection and fresher breath.

Colgate positioned several toothpaste so that people would like the products more like adding a different style or taste to the toothpaste.

Colgate repositions their products because with the way they market and promote their products, consumers know that these products are way better than other brands and competition that is out there.

Lately with competition from indigenous “vegetarian” toothpastes, Colgate dental cream has also positioned itself as an “always 100% vegetarian” toothpaste. The tagline of its advertisements, “trusted by generations to make teeth stronger”.

Colgate Total-12 have been projected as the “most advanced toothpaste” that provide 12 hour germ protection even after eating and drinking by building a protective shield around the teeth.

Colgate Max Fresh positions itself on the basis of “freshness”. The tagline “new dimensions brings” home this very point.

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Colgate Kids toothpaste tries to position itself based on emotions which is apparent in its tagline “makes fighting cavities fun”.

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PRODUCT MIX

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MARKETING MIX

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PRODUCTCUSTOMER WANTS AND NEEDS

PRICE COST TO SATISFY

PLACE CONVIENCE TO BUY

PROMOTION COMMUNICATION

1. Product :-

The product, the Precision toothbrush, is a product that should add value to a buyer’s life.

It should also add utility, and meet the wants and needs of targeted consumers.

The product should be unique and different from all similar products that are already available on the market.

The strategy is to differentiate the product’s design and packaging, which in return will cause the toothbrush to stand out.

VARIOUS TYPES OF COLGATE:-

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2. Price:-

The price of a product says something about the quality.

Even though the quality of the Precision toothbrush will be significantly higher than other leading toothbrushes, the price of the toothbrush will be determined by the prices of the other toothbrushes already in the market.

This pricing strategy is a result of positioning the toothbrush as a mainstream product rather than a niche product.

COLGATE

20gms

40gms

50gms

75gms

80gms

100gms

150gms

200gms

300gms

Dental cream

5rs ---- 14rs ---- ---- 30rs 45rs 56rs 86rs

Max fresh --- --- 15rs --- 32rs 35rs 55rs ---- ---

Total ---- ---- --- 35rs --- --- 65rs --- ---

Sensitive --- --- 35rs --- --- 60rs --- --- ---

Kids --- 26rs --- --- --- --- --- --- ---

Advance whitening

--- --- --- 27rs --- --- 53rs --- ---

Active salt ---- --- 14rs ---- ---- 30rs ---- 54rs ----

Cibaca --- --- --- --- --- 18rs --- 28rs ---

Herbal --- --- 14rs --- --- 30rs --- 55rs ---

Fresh energy gel

--- ---- ---- ----- --- --- 55rs 60rs ---

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3. Place:-

Place represents the location where a product can be purchased.

The most important part of marketing is how a product will get from the seller to the buyer.

Many products go through a channel of distribution, which involves manufacturers, wholesalers, retailers, and consumers.

The distribution strategy proposed for the Precision toothbrush is through dentists, plastic surgeons, drug stores, grocery stores, large retail stores, and department stores.

The product is available in the all India market, including semi-urban & rural markets which are their primary focus.

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4. Promotion :-

Product promotion is communication spread through advertising, Publicity and sales promotion.

Promotion represents all of the communication that marketers use in the market.

We suggest that Colgate-Palmolive advertise their products by using commercial, magazine ads, the radio, ads that are to be placed in dentist offices, billboards, and the sides of buses.

Advertising is done to promote new products, remind consumers of existing products, and also promote the image of the company at hand. We also suggested that Colgate offer special coupons and rebates through their other products, and also food products.

Also, Colgate could benefit from the usage of in-store displays.

Most of the promotional activities would be T.V. media.

T.V., FM radio for urban population.

Promotion towards rural population also.

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CONCLUSION

By the Detailed study on the product and market of COLGATE it was able to get a clear picture of the past and present of the products and was able to get in to the assumptions about the future of the product.

The Brand “COLGATE” has been sold successfully and has created a good demand all the time.

It is also holding a good place in the toothpaste market with a share of around 10% - 15%.

As like for all other products Colgate is also facing a tight competition in the toothpaste Market.

Since the competition is too strong the company has to keep on watching market closely for avoiding any sudden collapse for the product.

Finally, it should note that the company may have to face lot of threats in coming years like political threats, legislation threats ongoing economic crisis, changing life style of the people etc. If the company is able to overcome all the threats and can prepare themselves for facing the problems in advance it can achieve a good growth for “COLGATE”.

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