Colgate-Palmolive Co.

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Colgate-Palmolive traces its origins to William Colgate, a candle, soap and starch maker, who opened a business in New York in 1806. In 1928, Colgate merged with rival Palmolive-Peet to become Colgate-Palmolive-Peet, the predecessor of today's Colgate-Palmolive Co. The timing, on the eve of the Great Depression, seemed inauspicious.

But while the Depression ruined many businesses, the soap industry thrived. Soap was both a necessity and an affordable luxury. For a few cents, consumers could be transported to a palm-fringed oasis, according to Palmolive ads, or pretend to be movie stars with Cashmere Bouquet, which used Hollywood actresses in its advertising.

During the 1930s, Colgate's largest ad accounts were handled by Lord & Thomas and Benton & Bowles. By 1937, total ad spending by Colgate-Palmolive-Peet included $1.3 million for magazines and $1.6 million for radio. In 1942, the marketer's radio budget increased to $5.4 million, putting it among the top five radio advertisers, while its budget for magazines rose only slightly, to $1.4 million.

Product introductions

New products Colgate introduced in the 1940s included Fab detergent and Ajax cleanser, introduced in 1947. Colgate in 1948, via Chicago-based Sherman & Marquette, brought Ajax to TV in a spot that featured the Ajax Pixies, a trio of elves that were among the first animated commercial mascots. "Floats the dirt right down the drain" was the tagline.

When NBC launched TV's "Sunday-Night Comedy Hour" in 1950, General Motors Corp.'s Frigidaire subsidiary and Colgate alternated sponsorship, with GM on one week and Colgate the next. But Colgate CEO Edward Little gained full control of the show, and it was renamed the "Colgate Comedy Hour." From the 1950s on, Colgate—renamed Colgate-Palmolive Co. in 1953—and other soap manufacturers, notably Colgate archrival Procter & Gamble Co., became prominent advertisers on afternoon dramatic series, which, due to the products marketed by their sponsors, came to be known as "soap operas."

In 1962, Norman, Craig & Kummel produced a new campaign for Ajax, "the blue dot cleanser," that featured an animated white tornado. The following year, NCK invented the White Knight, who galloped down residential streets carrying a white lance to rescue housewives from domestic drudgery.

Madge the manicurist

In 1965, the company introduced Palmolive dishwashing liquid with spots that built on the reputation of Palmolive toilet soap's gentleness. Ads for the dishwashing liquid emphasized how kind it was to hands—a departure from the hard-working, grease-cutting approach used earlier. NCK spots introduced Madge, the manicurist, who soaked her clients' nails in the dish soap. "Palmolive softens hands while you do the dishes" and "you're soaking in it" became Palmolive theme lines. By 1967, sales of Palmolive dishwashing liquid passed $1 billion. The marketer continued to use the Madge character in advertising until 1991.

In 1968, Colgate made two innovations in the toothpaste segment: It introduced Ultra Brite, positioned as a cosmetic toothpaste, and reformulated its red-and-white Colgate brand, adding monofluorophosphate fluoride

Though the majority of Colgate products were pitched to women, some were aimed specifically at men. In 1972, Colgate introduced Irish Spring, a deodorant soap for "manly men," handled by William Esty Co. Ted Bates & Co. handled Palmolive Rapid Shave, and D'Arcy-MacManus & Masius created Wilkinson blade ads.

As the number of Colgate's products grew, so did its roster of advertising agencies. In 1976, the agencies and products advertised included Bates for Colgate dental cream, D'Arcy for Palmolive soap, NCK for Ajax cleanser and Esty for Ajax laundry detergent and Ultra Brite.

That same year, Colgate-Palmolive acquired Hill's Pet Products, which were sold primarily through specialty pet stores and veterinary clinics, untried channels for the marketer. Advertising, from Young & Rubicam, New York, touted Hill's special-diet pet foods using veterinarians as spokesmen. That strategy continued into 1999, when an ad in Southern Living featured a veterinarian and her pet cat with the tagline, "What vets feed their pets."

In 1981, the company celebrated its 175th anniversary, introducing Colgate Winterfresh gel, an extension of its toothpaste brand. Three years later, Colgate dropped Esty from its roster after 30 years and consolidated its global accounts at Bates, Y&R and Foote, Cone & Belding. Y&R, which handled Ajax dishwashing liquid, over time emerged as Colgate's dominant international shop.

Building again on the popular Palmolive name, Colgate introduced Palmolive Automatic dishwashing liquid in 1986, the first liquid soap for use in automatic dishwashers. The next year, Colgate acquired the liquid soap business of Minnetonka Corp. and formed Softsoap Enterprises to market liquid hand soaps.

In 1990, Colgate acquired Murphy's Oil Soap, the leading wood cleaner in the U.S.; Mennen Co., with its Baby Magic and Speed Stick deodorant and antiperspirant product lines; and the international rights to Plax, an anti-plaque mouth rinse.

A global strategy

On the international front, Colgate acquired the liquid soap brands of S.C. Johnson & Son in Europe and the South Pacific, which pushed the marketer to No. 1 in the global category, and acquired the Kolynous oral care business in Latin America. Increasingly, the marketer moved its manufacturing overseas.

Colgate is cited often as a leader in global markets. By 1999, only 26% of its sales came from the U.S., and the company was organized around five core businesses: oral care, personal care, household surface care, fabric care and pet nutrition.

In the U.S., Colgate Total brand toothpaste was a particularly successful 1990s product—the first toothpaste to receive the American Dental Association Seal of Acceptance for protection against plaque, gingivitis and cavities. By 1998, combined sales of all varieties of Colgate toothpastes had recaptured U.S. leadership in that category, a lead the company lost in 1962 to P&G's Crest.

By 2002, P&G remained Colgate-Palmolive's chief rival; for years the two sharply contested the toothpaste, soap, fabric softener and detergent segments. P&G in general has been a more aggressive advertiser than Colgate and is one of the leading U.S. issuers of free samples and discount coupons. Colgate's strategy has been to build its international markets, although by 2001, the U.S. market accounted for 30.5% of Colgate's sales.

For 2003, Colgate-Palmolive Co. had worldwide earnings of $1.42 billion, up 10.3% over 2002, on sales of $10.07 billion.

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