Colgate-Palmolive Canada: Fighting for a Share of the Toothpaste Market

After several years of near steady state, the market share of Colgate Palmolive Canada Inc. in the toothpaste category has gathered momentum in 2012. In a bid to extend the gap between the company and its primary competitors in the category in 2013, the vice-president of customer development is discussing the options with his team at company headquarters in Toronto. Market share is an important performance metric at the company. One suggestion is to increase the marketing budget. There is a general consensus that marketing dollars should not be diffused across activities during the year, but there are differences of opinion about what to focus on — trade promotions, consumer promotions or advertising — in order to sustain the momentum in market share in 2013.

This case is intended for a core marketing course but also fits well in an elective on brand management or advertising and promotion. It provides a good introduction to budget issues and the link between market dynamics, product positioning and tactical marketing decisions such as budget allocation.<ul><li>To understand the impact of consumer buying behaviour and retail channel behaviour on market budget decisions.</li><li>To understand the marketing budget implications in mature markets with limited growth rate, partial brand loyalty and intense competition for market share.</li><li>To enable students to analyze the trade-offs between advertising, trade promotion and consumer promotion in a competitive situation.</li><li>To provide an opportunity for students to understand the pressures on a brand/product manager in a consumer packaged goods firm.</li><li>To introduce product life cycle portfolio management and the evolution of this year’s new premium products forcing last year’s premium product down into the mainstream market. </li><ul>

• Market share
• retailing
• consumer promotions
• trade
• advertising
• growth strategy
• Canada