The dental cream's loss has been the double protection's gain. This means that Colgate has not lost market share to a competitor--in this case, Hindustan Lever's (HLL's) Pepsodent. The ORG figures, however, reveal that individually, Pepsodent continues to rise -- this time gaining market share over other smaller brands in the industry.

"Colgate Double Protection launched in June 1998 is gaining strong consumer acceptance with continued aggressive marketing support. The company has followed up this successful launch with theintroduction of the long- lasting Colgate Total toothpaste," says a Colgate Palmolive India spokesperson.

Colgate Dental Cream's all India (urban plus rural) market share has dropped in volumes from 45.1 per cent in March 1998 to 41.8 per cent in August 1998. Colgate Double Protection, launched in June this year, has cannibalised on the dental cream's share, and garnered 3.9 per cent market share at the end of August. The overall share of Colgate, thus, remains nearly the same at 56 per cent in August. Colgate has secured its overall market share as the spillover effect from Colgate Dental Cream has been retained in the net.

Analysts believe Colgate Double Protection's launch, and the increased advertising budget surrounding it were strategic moves by the multinational to avoid shedding market share to HLL. Had Colgate not launched Double Protection, the scenario would have been different, with a loss in Colgate Dental Cream's share being HLL's gain.

Colgate, according to Inquire Indian Equity Researchanalyst Ayaz Motiwala, has raised its ad-spend to 20 per cent of sales in the first half of the current fiscal (which witnessed the launch of Double Protection), from 14 per cent last year. Colgate's ad-spend as on March 31, 1998, stood at Rs 148 crore. The step-up in marketing expenditure led to Colgate-Palmolive posting a 59.49 per cent drop in its net profit in the first half of the current fiscal to Rs 17.71 crore, from Rs 43.72 crore in the same period last year, with margins coming under severe pressure.

Lever, on the other hand, has played its cards well with a consistent support backing Pepsodent, as a result of which, the brand's market share has appreciated to 13.4 per cent (all India in volumes) in August, from 11.7 per cent in March. The overall HLL share has creeped up to 31.7 per cent in August, from 30.1 per cent in March.

While Colgate has managed to arrest the gash in its overall share, will it continue to be on the defensive? Analysts feel the company is building a base, starting withbeing on the defensive, to finally come out in the offensive as part of its second-phase operation. "What is required now is to control any further damage. To put a full-stop to its dwindling market share is of utmost importance to Colgate. To ensure that a further decay does not take place, Colgate has attempted to enable a shift in consumer preference from Colgate Dental Cream to Double Protection," says Motiwala.

Analysts feel the company is expected to hit back later. It has sent out clear signals that Double Protection will sooner or later replace Colgate Dental Cream as the flagship brand, they add.

Others, however, feel the launch of Double Protection was a short-term move to curtail a sudden cast-off in market share. "Colgate should re-position Colgate Dental Cream by identifying why consumers are moving away from it, as it is the star brand. While at the moment it looks like Colgate is only passive and reactive in its approach, it has to become more aggressive," feels Samsika MarketingConsultants managing director Jagdeep Kapoor.

Colgate's presumable approach to retain any spillover from the dental cream by launching Double Protection, feels Kapoor, is kind of a rear-guard action as "a star brand cannot be protected by pawns."

HLL's Pepsodent launch bruised Colgate Dental Cream's market share last year, especially after the break of Lever's disputed "102 per cent superior" advertising campaign. Lever saw a faster ascent on the back of Pepsodent last year. For instance, Colgate Dental Cream's market share, hit by the Pepsodent onslaught, had dropped by 8 per cent in September 1997 to 41.9 per cent, from 44.3 per cent in August last year.

Colgate-Palmolive is likely to stabilise its position at the 56-57 per cent level, feel analysts. The company's share last year was hovering around 60 per cent. Thus, while it seems difficult to catch Pepsodent's rise, Colgate has managed to contain Pepsodent's penetration into its overall share.

"Colgate will be in a position to stem the rot inits market share only by meaningful investments in promotion, which will pressurise its margins in the short term. Earlier, any market share gain by HLL was having a negative impact on Colgate's share," analysts pointed out. During the last 12 months, the growth in the Rs 1,200-crore toothpaste industry has been 3-4 per cent. The volume of the toothpaste market is around 70,000 tonnes.

HLL's hold on the urban market is stronger than the rural, with its urban volume share at 35.2 per cent in September, up from 33.1 per cent in March. Colgate-Palmolive's volume share in the urban market is around 53 per cent, with Double Protection having picked up over 4 per cent share. Colgate Dental's Cream's share in volume terms continues to decline in the urban market, from 39.5 per cent in March to 35.5 per cent in September.