Marketing Management Report: Analyzing Pepsodent's Customer Value

This report provides a comprehensive analysis of Pepsodent's customer perceived value, exploring various models like the Means-End Model, Typology of Customer Value, and Customer Value Hierarchy Model to understand how customers perceive the brand. It compares Pepsodent's value proposition with its primary competitor, Colgate, examining factors such as brand strength, market segmentation, and customer value propositions in business markets. The study utilizes the Value Proposition Builder to assess different aspects of the market, offerings, benefits, and differentiation. Through benchmarking and a customer value model, the report identifies key strengths and weaknesses, ultimately aiming to develop an effective value proposition and implementation plan for Pepsodent to enhance its market position and customer engagement. The research incorporates both intrinsic and extrinsic attributes to understand customer purchasing decisions.

MARKETING MANAGEMENT

ABSTRACT
The thinking and perception of the customers regarding the products and services of the
company are known as Customer Perceived Value. This study focuses on utilizing different
strategic approached in order to determine the perceived value regarding the products as well
as the organization. The value proposition has been provided of Pepsodent along with their
competitor Colgate. The conclusion of the study is that to develop an appropriate value
proposition along with an implementation plan.
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Table of Contents
ABSTRACT........................................................................................................................................1
INTRODUCTION................................................................................................................................3
COMPANY PROFILE..........................................................................................................................3
OBJECTIVES......................................................................................................................................3
IDENTIFY THE CUSTOMER PERCEIVED VALUE FOR PEPSODENT.....................................................4
COMPARISON AND EVALUATION OF EXISTING VALUE PROPOSITION OF PEPSODENT AGAINST
COLGATE ALONG WITH THE BENCHMARKING OF THE VALUE PROPOSITION................................8
PEPSODENT VALUE PROPOSITION: CUSTOMER VALUE MODEL.................................................8
CUSTOMER VALUE PROPOSITIONS IN BUSINESS MARKETS........................................................8
BENCHMARKING THE TWO VALUE PROPOSITION....................................................................12
IDENTIFICATION OF THE NEW VALUE PROPOSITION....................................................................15
IMPLEMENTATION PLAN OF THE NEW VALUE PROPOSITION......................................................17
CONCLUSION.................................................................................................................................20
REFERENCES...................................................................................................................................21
APPENDIX.......................................................................................................................................24
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INTRODUCTION
The purchasing decision of the customers is majorly dependent on the perceived value of the
products and services which are offered by the organization. The primary reason due to which
consumer purchase products is called perceived value (Hooley, et al. 2012). The researchers in
this study will be utilizing different strategic approached for determining the customer
perceived value among Pepsodent and Colgate and their value proposition is in business to
consumer segment.
COMPANY PROFILE
Pepsodent is one of the leading oral care brands that was established in 1993 and possess the
huge variety of products which have been managed by Unilever for long period of time. The
market competitors of Pepsodent are Colgate, Sensodyne, and Close-up. The revenue
generation of Pepsodent is around $22 million yearly.
OBJECTIVES
The prime objective of the research study is to identify the customer perceived value of
Pepsodent and also analyze their existing value proposition as compared to their competitor.
Also, a new value proposition has been proposed which will be coping with the desired value
measures of the target customers.
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IDENTIFY THE CUSTOMER PERCEIVED VALUE FOR PEPSODENT
Customer perceived value is known as the general assessment done by the customer regarding
the product on the basis of their opinion and perception. The customer value perception for the
products could be measured by:
Customer Perceived Value = Perceived Merits – Perceived Demerits
Actually, the features and characteristics of Pepsodent are quite similar to their competitor
which is Colgate. The analysis and evaluation in this study have been focusing on the value
proposition of Pepsodent which have been perceived through different models of customer
values such as:
MEANS-END MODEL
This model helps the organization in evaluating the correlation among the theories of perceived
price, quality, and perceived value regarding the perceptive of customers. For assessing the
model, it is necessary to examine and evaluate different attributes like perceived value and
customer value (Chen & Chen, 2010). It is observed that every customer measure the products
on the basis of their intrinsic and extrinsic attributes.
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Figure – Means-end Model
Source – Birkett, 2016
The driving factors for the customers for purchasing products of Pepsodent could be
segmented into extrinsic attributed like positioning, advertising level, brand, and pricing. In
addition, the intrinsic attributes comprise of colour, packaging, flavour, and textures.
The extrinsic attributes of Pepsodent are ranking 9th of worldwide personal care industry, 13%
of market share possessed by them, and the level of aggression in their advertisement through
radio programs, television commercials, celebrities, etc. The focus of the study is to assess the
customer perceived value for Pepsodent and it has been evident that Pepsodent has been using
adequate strategy for attracting customers through effective extrinsic and intrinsic attributes
(Lai & Chen, 2011). Pepsodent has been focusing on making the gums and teeth healthier along
with protection from cavities while the Colgate provides protection from cavities and
prevention of plaque and gingivitis, etc.
It has been depicted from the above analysis that the customers focus on the intrinsic
attributes which are helpful for Pepsodent in gaining customer perceived value effectively.
Though, the customers are also focusing on the extrinsic attributes which could influence the
customer perceived value for Pepsodent as their prime competitor (Colgate) is the market
leader globally.
TYPOLOGY OF CUSTOMER VALUE
This framework is helpful in assessing different kind of typologies regarding the customer
perceived values. The typology for value has been developed through persistent analysis of the
literature. The study has assessed the customer perceived value through the different sources
like journals, articles, documents, books, etc. It has been depicted from the analysis that
Pepsodent has differentiated their brand by introducing in the different colour like pink, white,
and sky blue along with its taste and other economic and environmental favourable (Flint, et al.
2011). In addition, Pepsodent has won the world oral health challenge conducted in Nigeria on
the occasion of World Health Day.
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Pepsodent possesses several extrinsic attributes regarding their product in terms of the huge
distribution network, high efficiency regarding their services, and they imply the social
considerations regarding the needs of customers about their toothpaste (Flint & Woodruff,
2014). The intrinsic attributes are based on the economic and environmental favourable in
which Pepsodent has been taking positive environmental and social impacts. In addition to this,
Pepsodent has been providing their toothpaste away from any kind of harmful ingredients that
further affect the human beings.
Hence, it has been evaluated that the customer perceived value regarding Pepsodent has been
dependent on the huge range of products by them along with the high-quality service provided
by them. The taste of their products is also attracting the customers which have been
transforming the customer perceived value towards the Pepsodent. Moreover, the Holbrook’s
framework is helpful in determining the prime customer values and in terms of Pepsodent the
customer perceives values are multidimensional.
CUSTOMER VALUE HIERARCHY MODEL
According to this model, the goals are arranged in a hierarchical manner in which the
customer's value is at the top while the consequences are in middle and the product attributes
placed at the bottom.
Figure – Customer Value Hierarchy Model
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Source - Aulia, et al. (2016)
This model helps the company in developing the values of their products. Here, the customers
have effectively developed the judgment regarding the products of Pepsodent on the basis of
their attributes (Gallarza, et al. 2011). It is understood through the application of Woodruff's
model that the customer perceived values strongly rely on the products of the Pepsodent. The
consequences are known as the results that acquire due to the product values and attributes
among the customers.
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COMPARISON AND EVALUATION OF EXISTING VALUE PROPOSITION OF
PEPSODENT AGAINST COLGATE ALONG WITH THE BENCHMARKING OF
THE VALUE PROPOSITION
PEPSODENT VALUE PROPOSITION: CUSTOMER VALUE MODEL
The important value proposition for Pepsodent is their different kind of products in the market.
Still, their prime competitor (Colgate) possesses the huge variety of distribution in the market
along with the products.
Pepsodent has been focusing on delivering innovative and unique products in the market under
the affordable prices and also focus on developing products in order to perceived quality by the
customer. A differentiation has been observed that the Colgate is offering products on premium
pricing (Grönroos & Ravald, 2011). In addition to this, the other differentiation is that
Pepsodent possesses a healthy customer relationship i.e. with internal customers and also
provide high salary in comparison to Colgate whose primary focus is on external customers.
Further, the competitive product's positioning of Pepsodent should also be considered for the
comparison. Pepsodent has a strong brand image due to their social relationships along with
the economic and environmental favourable as compared to Colgate. Still, both the companies
are actively performing to becoming eco-friendly.
A satisfaction survey has been conducted for the research through the survey in which around
80 respondents have been selected through random sampling method with help of verbal
interview (Zott, et al. 2011). It is necessary for Pepsodent to strengthen their value proposition
regarding their packaging appearances, promotions, and customer relationship engagement
which will help them in gaining the competitive edge over the Colgate.
CUSTOMER VALUE PROPOSITIONS IN BUSINESS MARKETS
The focus of this model is on building comparison of the value proposition of Pepsodent against
Colgate. There are three kinds of value propositioning such as favourable elements of
difference, all benefits, and resonating attention.
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The internal and external customers comprise under the “all benefits”, Pepsodent has been
offering several products to their external customers that have the variety of taste,
attractiveness, healthy efficiency and diversification (Malthouse, et al. 2013). It has been
depicted that the customers have been looking for the healthier products along with the
variation in the offerings.
Figure - Customer Value Propositions in Business Markets
Source - Anderson, et al. (2016)
Favourable Elements of Difference – Pepsodent has the substantial and competitive edge
against Colgate as their products are diversified in the personal care industry while the focus of
Colgate is on limited products only. It has been observed that the products of Pepsodent and
Colgate are similar as they both provide toothpaste and mouthwash.
The other difference is observed regarding the affordable pricing costing in which the
Pepsodent has gain higher market attractiveness as compared to Colgate. Further, the
resonating focus of both Pepsodent and Colgate relies on different factors. The products of
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Colgate and Pepsodent are both ecological and environmentally friendly. Still, the market
effectiveness relies on both intrinsic and extrinsic attributes but the company possess similar
value proposition (Tatikonda, et al. 2014). It is evident that the Colgate possessed a huge
capability of demonstrating their attributes in the market and their customer perceived value is
also higher. Thus, the capabilities of Pepsodent are lower in these areas.
VALUE PROPOSITION BUILDER
This model provides the clear measured value of the customer or organization’s experience that
they gained from the offers in which the value is defined as subtraction of cost from benefits.
The different elements of the value proposition are as follows:
Market – In the market segment, the target customers of Colgate are all ages while the focus of
Pepsodent is on the new generation and adult. Each brand possesses certain perceived values
regarding the intrinsic and extrinsic attributes. It is necessary for Pepsodent to cover the
requirements of each kind of customers (Chauhan & Shukla, 2016). In addition to this, the
popularity of Colgate is much higher than other brands as they are promoted in all over the
world at the huge level. Also, their production and distribution are conducted in worldwide
regions.
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Figure – Value Proposition Builder
Source - Huynh, (2015)
Value experience and Offerings – It has been evident that the customer service value of
Pepsodent regarding the experience and offerings is much efficient as compared to their
competitors.
Benefits and Alternatives along with Differentiation – The products provided by Pepsodent are
healthy and also affordable in prices. Meanwhile, the Colgate products are in the different price
range and they are more diversified than Pepsodent.
Proof – Colgate and Pepsodent is the prime competitor and most strong brand at the
worldwide level. It has been evaluated from the above analysis that Pepsodent possesses
limited differentiation regarding Colgate.
COMPARISON AND EVALUATION OF EXISTING VALUE PROPOSITION
It has been understood from the value proposition analysis that the value proposition of
Pepsodent has explained the limitation of the market segmentation and the focus of Colgate is
on the different range of products for their consumers of all ages (Bansal, 2014). The product
diversification, brand acquisition, eco-friendly commitment and world range distribution is
helpful for Pepsodent in effectively enhancing and developing their brand positioning against
Colgate. The employees should be provided with advanced training for better customer
services.
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