Cottle Taylor: Expanding the Oral Care Group in India
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In 2009, the director of the oral-care marketing for the India division of Cottle- Taylor, Brinda Patel, thought of the brilliant idea to expand the oral care system in India. At this time 50% of the Indian population was very uninterested in curing their dental problems and did not see the need to obtain dental hygiene like toothbrushes and toothpaste. However, this did not stop Patel. She still believed that her plan would have a 20% increase in toothbrush unit sales. Her plan was to reward regions that met or exceed sales objectives and to reorganize those that underperformed. Patel’s boss gave her two days to revise a marketing plan that came close to 30% unit sales growth. Patel was determined and confident in doing so.
In 2009, India was not doing so great as a country. They has about 37% of their population living below the poverty line ($1.25 U.S dollars per day) and about 78% lived in rural towns and villages. Many Indians cleaned their teeth with Neem twigs and didn’t associate with dental healthcare at all. The Indians who live in rural towns were more likely to refrain to these oral care products. A lot of the problem was that there were not dental technicians readily available to the Indian population at all. The dental professionals would move out of India for a higher pay. This caused the problem of not even being aware about the importance of the modern health care. Cottle-Taylor in 2009 needed to bring three different marketing strategies to India to become successful and increase sales in the oral care group: segmentation, targeting and positioning. These were three very important things to consider when making this expansion into India. Segmentation is the act of dividing the target market into subsets of consumers who have the common needs and priorities and then implementing the strategies to target them. This was very important to India’s dental care because 50% of the population was not interested in changing their dental habits at all.
With segmentation, Cottle-Taylor’s Company can easily assess which of their products they should market to those who have never used a toothbrush before, those who use them but not as frequently and those who have been using toothbrushes in the past. The company can also separate it within demographics. They can market the product to those with low incomes, those with middle incomes and products for those with higher incomes. This would help the consumers know what it is that they want and know that there is something that they can also afford. With this marketing strategy, you can get the most profit since more people will buy what they can afford. Targeting is another great marketing strategy that would be very beneficial to Cottle India’s products. Targeting is to strategically place advertising to reach consumers based on demographics, income, behaviors etc. India needs different target audiences based on the type of product that needs to be sold to a specific region or people group. If you adapt your products to satisfy the people who are buying them, they would more likely want to buy them. With toothbrushes, if you target them to the population of Indians that are more likely to buy them, or target this new invention to those who never used them, the different targeting ploys will definitely help gain profit.
What Patel thought would be most successful was to target more towards those who have never been exposed and those who don’t use them as frequently in India, and then eventually once they see and understand the importance they can upgrade to the battery powered toothbrush. I believe that was the most lucrative plan for the company as well. The people who already are using toothbrushes do not need as much advertising as they have already been a part of the toothbrush selling market. Positioning is the last one and it is the most important. You need to be very strategic in where to place your product to where it would be the most profitable. These strategies are exactly what was a part of Brinda Patel’s plan. She devised three different marketing/advertising plans to help increase the demand of these products. The first was to persuade consumers to brush for the first time. These advertisements would be placed and targeted in the rural regions where they were using the twig methods of dental car This type of advertising would be low income, using the 12mm budget for advertising. Secondly she wanted to increase the incidence of brushing. It was shown that the people in India who were brushing their teeth did it very infrequently. This would be more for people who have been exposed in middle incomes.
This type of marketing would be used more heavily. The last was to persuade consumers to upgrade to mid-range or premium products. This would be targeted to people in the urban areas that had more money than those in the rural regions. Brinda Patel’s plan is planned out very well and is very reasonable to succeed if produced correctly. She is thinking more long term, which would benefit the company in the long run. The marketing and advertising will definitely get customers to want to buy and see the importance of the toothbrush and as they become more exposed to the possibilities they will upgrade. As Shown in Exhibit 8, India is slowly but surely working there way to improving dental health care. In 2009, 87% were buying low-end manual brushes, 12.5% were buying mid-range manual and .5% were buying battery-operated. This means that they are increasing to some extent their product usage. Exhibit 9 also shows the percentage income statement from toothbrushes. Cottle India in 2009 made an 18% profit from their operations. This is definitely raising and increasing drastically. It just depends on how you market the importance of the products that you are selling and targeting them to the right people. Even though they are not making as much money in India as they are in other regions, this start is definitely something that they can work on expanding. Income Statement for 2010:
Cost of Goods Sold
(low income) (middle)
Cost of toothbrush
3,000+ 9,000= 12,000
Net Income Before Tax = 38,500
With the plan of Brenda’s using only the low and middle income if they sell the amount of toothbrushes within that one year in India then they would
make a massive profits. Selling 1,000 low income toothbrushes and 50,000 of the middle income they would sell 101,000 dollars and adding in the costs of the toothbrushes and advertising they would make 38.5 thousand dollars their first year. Patel is curious to increasing by 3% in ad dollars lead to higher revenues and profitability. I definitely believe so. With the rate of expansion throughout India showing the importance of dental care, and the rate that it is currently rising at, I believe that with a 3% increase, advertisers would still buy this to continue to rise and the expansion of dental health care.
In conclusion, this was a very smart deal for Cottle-Taylor Company to market towards the lower incomes. With earning the majority of dental sales in India, this partnership was a great marketing and strategic management move for their company. Because they were the first and most reliable at the country, consumers will keep relying on Cottle to go to for their dental care products. The only thing that the company needs to expand on is the amount of people who are interested in this product. If they get a more steady consumer basis, their profits will rise exponentially.