SWOT analysis of Colgate Palmolive

Colgate Palmolive is a company that operates in the consumer goods and personal care segment headquartered in New York, USA.  The company was established in the year 1806 and has been dealing with personal care products like oral care under the brand Colgate and bath and shower products under the brand Palmolive.

In addition to this, the company also sells pet care and veterinary products under the Hills Pet Nutrition brand. Their oral care line Colgate has dominated that segment for many years and still continues to be one of the most solicited toothpaste brands across the world. The company also enjoys a very high brand loyalty for the brand Colgate.

The other popular brands from Colgate Palmolive include Elmex, Protex, Ajax, Kolynos, Tom’s Maine, Irish Spring, Axion, Mennen, Sorriso, and Softsoap.Though headquartered in the US more than 75 percent of the revenue of the company comes from markets outside the region, Asia being their biggest market. In addition to Asia and USA, the company also has operations in South America, Europe, Africa and Australia. The company registered an annual turnover of 15.5 billion USD in the year 2017.

Strengths in the SWOT analysis of Colgate Palmolive

Strengths are defined as what each business does best in its gamut of operations which can give it an upper hand over its competitors. The following are the strengths of Colgate Palmolive :

• Indigenous Manufacturing: Quite unlike the competitors, Colgate Palmolive owns their manufacturing facilities and indigenously manufacture all their products. This ensures that there is higher operational efficiency.The company owns 60 such facilities across the world.
• History: Colgate Palmolive was found more than two centuries ago and comes with a rich history. The company was the pioneer in research and is one of the oldest companies in existence today. Forbes has voted the company as one of the best places to work with and the company has got a number of awards like Top 50 Green Brands. U.S.EPA awards Energy Star Partner of the Year 2015.
• Brand success of Colgate: Colgate is a brand which has enjoyed enormous success and had high customer goodwill. Colgate has been a pioneer in tubes of toothpaste, toothbrushes and oral hygiene and is one of the most trusted brands in the world. This has made it the world leader in the oral care segment and also one of the biggest strengths of Colgate Palmolive.
• Clear positioning: The reason behind the success of Colgate is the clear need-based positioning that the brand has adopted. The company has identified various oral care needs like sensitive teeth, bleeding gums or bad breath and have variants of Colgate for each of these needs.
• Testimonials: Colgate is a brand that enjoys high levels of customer satisfaction and brand loyalty and thus most of their ads feature testimonials from users if the paste. These advertisements increase the credibility of the brand and positively impact the sale of the toothpaste.

Weaknesses in the SWOT analysis of Colgate Palmolive

Weaknesses are used to refer to areas where the business or the brand needs improvement. Some of the key weaknesses of Colgate Palmolive are:

• Weak brands: In comparison to Colgate the other brands of Colgate Palmolive like the Palmolive soaps are weak and do not enjoy the trust and success of Colgate. The personal care line under Palmolive struggles to match up to market leaders like HUL and P & G.
• Brand Dilution: Colgate has been always associated with the signature white toothpaste. But as competitors have started introducing new variants in areas like sensitivity, bad breath, bleeding gums and kids toothpaste, the brand has been also introducing new product lines in these categories. This increases the risk of dilution of the signature Colgate Toothpaste.
• High cost of operation: There is a surge in the number of players in both personal care and oral care segments and new products are being launched frequently.In order to sustain in the race, Colgate Palmolive will need to invest heavily in product research, advertising, and promotions but may not be able to increase prices.

Opportunities in the SWOT analysis of Colgate Palmolive

Opportunities refer to those avenues in the environment that surrounds the business on which it can capitalize to increase its returns. Some of the opportunities include:

• Unexploited rural markets: In most of the emerging markets there are huge rural markets where personal care products are yet to create an impact. The biggest rural markets are in China and India and these offer huge potential for companies who operate in the personal and oral care segment.

Threats in the SWOT analysis of Colgate Palmolive

Threats are those factors in the environment which can be detrimental to the growth of the business. Some of the threats include:

• Competition: The company faces a lot of competition from brands such as Closeup, Dabur, Sensodyne, and Meswak.
• Growing apprehension on chemicals: Customers are apprehensive about the presence of chemicals in consumables and this is shifting their choice from non-ayurvedic to organic or ayurvedic products. This is a trend which can threaten Colgate Palmolive in both oral care and personal care segments.