Colgate Children's Toothpaste Flavor Extension: Australia Marketing Plan

Introduction to Toothpaste and Colgate's Product Portfolio

Toothpaste is a generic term for oral pastes or gels that, together with a toothbrush, clean and maintain the health of teeth. Toothpaste aids oral health by providing abrasiveness to remove dental plaque and food from the teeth, reducing bad breath, and delivering active ingredients such as fluoride and xylitol to help prevent tooth and gum disease. While most of the physical cleaning is achieved by the mechanical action of the toothbrush, taste, flavor, and color all influence brushing compliance — particularly in children. Although toothpaste is never intended to be swallowed, research finds that children are more likely to brush, and to brush longer, when using a good-tasting toothpaste (Toothpaste, 2011).

One of the leading global producers of toothpaste is the Colgate-Palmolive Company, an American multinational that in 2009 posted $15.3 billion in revenue. Colgate focuses on household and personal care products including soaps, detergents, veterinary products, and oral hygiene (Colgate-Palmolive, 2011). Currently, Colgate produces 13 brands of toothpaste designed to promote oral health across specific consumer niches:

(Toothpastes, 2011)

It is extremely important to develop good brushing habits in young children as early as possible. Dentists and child nutrition scholars suggest a number of strategies: colored toothbrushes, reward charts, appealing flavors, and so on. Brushing at least twice a day is imperative for proper oral health (Maritz, 2009). For marketing professionals, the children's market has been significant for decades. When marketers recognized that children's preferences had become an important and decisive factor in parents' buying habits, they adjusted their strategies accordingly.

A classic example of this dynamic is found in the toothpaste industry. Companies originally formulated products to appeal to a broad audience — parents, grandparents, adolescents, and children — so they defaulted to mint or cinnamon flavors. Children tended to dislike both, which led manufacturers to introduce bubble-gum flavor. Children responded enthusiastically, spurring numerous product extensions including flavored mouthwash, toothbrushes, and dental floss (Stanton & George, 2005, p. 251). A recent review of products available in Australia or through mail order found nearly 500 different flavored toothpastes for children currently on the market (Child Flavored Toothpastes, 2011).

Situational Analysis for Australia

The following PEST analysis outlines the key political, economic, social, technological, and legal forces shaping the Australian market for children's toothpaste (Central Intelligence Agency, 2011):

Political: Australia is an active and diverse member of the community of developed nations, operating as a stable parliamentary democracy. It tends toward economic conservatism and more liberal social policies. The country maintains an open-door business policy that encourages international and multinational development, and has complex and robust trading arrangements, exporting slightly more than it imports.

Economic: Australia has a sophisticated and modern economy, though it faces recessionary pressures alongside other developed nations. It maintains an open market with strong relationships with both Eastern and Western trading partners.

Social: Australia's population of approximately 21 million includes about 69% between the ages of 15 and 64. The population is largely literate, and the country devotes roughly 5% of GDP to education. Immigration is fairly high, with 200,000–300,000 new citizens per year, most arriving from Asia. Healthcare spending stands at approximately 10% of GDP; like most developed countries, Australia faces rising rates of obesity, diabetes, and heart disease linked to diet.

Technological: Eastern urban areas serve as hubs for technological development, and the country has invested approximately $30–40 billion in intellectual property rights. Communications infrastructure is improving, though vast interior regions remain underdeveloped.

Legal: Australia operates a developed capitalist economy with governmental oversight, a legal system similar to the British model, and active product safety advocacy groups.

Competitive Analysis and Market Share

Colgate entered the Australian oral care market in the 1920s and is now the top-selling toothpaste brand nationwide. The soap and toothpaste manufacturing industry in Australia is worth approximately $3 billion and has shown an annual growth rate of roughly 3% (Soap, Detergent Manufacturing in Australia, 2011). Consumers overwhelmingly view Colgate as the benchmark for quality and oral protection. Australians have grown up with the brand and continue to use it throughout their lives — a dynamic that becomes increasingly relevant as the population ages and Colgate deepens its role as a total lifespan oral care preference (Sydney Morning News, 2003).

Key competitors include Crest, Tom's of Maine, and lower-cost imports from Asia. However, Colgate's long-established market presence and strong brand equity provide a substantial competitive advantage in both adult and children's segments.

Customer Base and Market Size

Approximately 20% of Australia's population is under the age of 14, making the potential market for children's toothpaste roughly 5 million individuals. On average, a tube of toothpaste lasts approximately 30 days, so the potential annual market is approximately 5 million × 12, or 60 million stock-keeping units (SKUs) of toothpaste per year. This estimate is particularly robust given that nearly 90% of Australia's population lives in urban areas, where access to dental hygiene products and regular, state-supported dental visits are the norm (Australia, 2011).

References

Australia. (2011, January). Retrieved from The World Bank: http://data.worldbank.org/country/australia

Central Intelligence Agency. (2011, January). Australia. Retrieved from CIA World Factbook: https://www.cia.gov/library/publications/the-world-factbook/geos/as.html

Child Flavored Toothpastes. (2011, September). Retrieved from TheFind: http://www.thefind.com/beauty/browse-child-flavored-toothpaste

Colgate-Palmolive. (2011, January). Products and information. Retrieved from Corporate Web Page:

Funny Face Packs. (2005, June). Retrieved from The Imaginary World: http://theimaginaryworld.com/ffpac.html

Maritz, L. (2009). Health, safety and nutrition for the young child. Belmont, CA: Cengage Wadsworth.

Soap, Detergent Manufacturing in Australia. (2011, July). Retrieved from IBIS World: http://www.ibisworld.com.au/industry/default.aspx?indid=190

Stanton, J., & George, R. (2005). Success leaves clues: Practical tools. Aberdeen, WA: Silver Lake Publishing.

Sydney Morning News. (2003, November 27). Brighter future of toothpaste. Retrieved from SMH.com.au: http://www.smh.com.au/articles/2003/11/26/1069825840957.html

Taste Test: Healthy store-bought snacks for kids. (2011, April). Retrieved from Epicurious:

Toothpaste. (2011, June). Retrieved from Dental Plaque Formation and Protection: http://dentalplaque.wikispaces.com/Toothpaste

Toothpastes. (2011, January). Retrieved from Colgate Oral and Dental Health Resource Center: