Colgate plans big ad push for toothpaste U.S. introduction of Total to come with $100 million campaign aimed at Crest

Consumer products

December 30, 1997|By BLOOMBERG NEWS

NEW YORK -- Colgate-Palmolive Co. will spend $100 million on advertising for its Colgate Total toothpaste in a bid to steal U.S. customers from rival Procter & Gamble Co.'s Crest toothpaste.

Colgate, which also makes Mennen deodorant and Ajax cleanser, will spend about $60 million on print, television and radio advertising, with the balance going to consumer promotions such as giveaways.

While figures on which company has the largest market share in the U.S. conflict, Colgate's huge advertising budget for Total shows that it's making a strong play to pull ahead of Crest, much as it did in Canada, on the strength of its new toothpaste.

"I think Canada is your best indicator for what will happen here," said Patrick Dunkerley, an analyst with Securities Corp. of Iowa. "There is the potential for a home run here."

Colgate will use the same sort of ads that it used in Canada when it introduced Total in late 1993, and it hopes they'll have the same effect. There, Colgate's market share rose to 36.3 percent from 21.5 percent, while P&G's market share fell to 27.3 percent from 35 percent, according to ACNielsen survey figures provided by Colgate.

Which company holds the lead in the United States isn't clear. Information Resources, a Chicago market research company, says Crest is still the most popular with about a 25 percent market share, compared with Colgate's 23 percent as of late October.

According to figures from ACNielsen cited by the Wall Street Journal yesterday, Colgate has pulled ahead in the past few months with 26.2 percent of the toothpaste market, compared with 25.3 percent for P&G. If the Nielsen figures are true, it would be the first time that Colgate has pulled ahead of Crest since 1962, the company said.

Colgate introduced Total five years ago and now sells it in 103 countries.

In the United States, Colgate Total had to be approved by the Food and Drug Administration because it contains Triclosan, an antimicrobial agent that destroys bacteria.

Colgate is able to devote so much money to advertising because it has been trimming costs in other areas. For example, a computerized inventory control system has helped to reduce the company's cost of goods sold, Dunkerley said.

"They have been very successful at driving down costs," Dunkerley said. "Automation is allowing them to up the ante in marketing and put pressure on the competition."

Total's ad budget is large by industry standards. Procter & Gamble spent about $65 million in the U.S. advertising Crest toothpaste for the 12 months through September, according to Competitive Media Reporting.

Pub Date: 12/30/97

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