Ads threaten wipe out of Colgate-Palmolive in India

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NEW DELHI -- An ongoing ad campaign by Hindustan Lever for its New Pepsodent toothpaste brand is threatening rival Colgate-Palmolive (India's) existence, the Supreme Court of India was told by Colgate's lawyer.

Soli Sorabjee told the court December 8 that Colgate was facing a wipe-out if Bombay-based Lever, Unilever's 51% owned flagship, was allowed to continue its $2.2 million campaign, which even after modifi- cation, was injuring Colgate.

The New Pepsodent ads were inherently deceptive as they alleged Colgate's flag- ship Dental Cream toothpaste brand was inferior, Mr. Sorabjee said.

Lever moved the court to remove a four- month ban imposed November 5-6 by the Mono- polies and Restrictive Trade Practices Commission on TV and print ads that said New Pepsodent was "102% better" than the leading toothpaste brand, indirectly imply- ing Colgate Dental Cream without naming or voicing aloud the brand.

"The pictures and captions going along with the ads were injurious to [Colgate's] reputation," Mr. Sorabjee said. "The commis- sion had rightly passed an injunction against [Lever]."

Ammirati Puris Lintas India, Bombay, handles Pepsodent and Rediffusion-Dentsu, Young & Rubicam Advertising, also Bombay, handles Colgate.

Both marketers are battling for the $267 million Indian toothpaste market. Though the market leader, Colgate's share slipped nearly three points to 41.9% in September after Lever broke New Pepsodent ads August 29 and continued running them till the stay was imposed. In the one-month period, New Pepsodent gained a 1.4% share to touch 8.4%.

Colgate, owned 65% by New York-based Colgate-Palmolive Co., claims it has lost 4.6 million customers as a result of the Lever campaign, which another lawyer repre- senting an ordinary Colgate customer said was even more disparaging on TV.

Iqbal Chagla, a leading corporate lawyer, said the old and new Pepsodent toothpastes were identical in ingredients. "People should not be led to choose the toothpaste under [an] erroneous impression," Mr. Chagla said.

Lever said its campaign was based on laboratory findings and did not disparage its rivals' products. But the marketer refused to verify New Pepsodent's vaunted claims with an independent expert panel.

The court's Justice Suhas Sen and Justice M. Jagannadha Rao are expected to rule this week.

Copyright December 1997, Crain Communications Inc.

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