SWOT Case Study - Trojan (Church and Dwight Company)

Trojan is owned by Church & Dwight Company, Incorporated, also known as, Arm & Hammer. The company is headquartered in Princeton, New Jersey and employed about 3,700 people as of December 2008. Church & Dwight Co., Inc., founded in 1846, is the leading U.S. producer of sodium bicarbonate, popularly known as baking soda.

hurch & Dwight's consumer products business is organized into two segments: Consumer Domestic, which encompasses both household and personal care products, and Consumer International, which primarily consists of personal care products such as condoms and home pregnancy tests. This SWOT analysis is about Trojan.

Strengths

• Trojan brand condoms are America's #1 condom, and have been a recognized, trusted, global brand for over 90 years.
• Trojan brand latex condoms are made from premium quality latex to help reduce the risk of unwanted pregnancy and sexually transmitted diseases.
• They have over 30 varieties of condoms to suit the needs of every target consumer.
• Each condom is electronically tested to help ensure reliability.
• The company recorded revenues of $2,422.4 million during fiscal year (FY) ending December 2008, an increase of 9.1% over FY2007. The operating profit of the company was $340.3 million during FY2008, an increase of 11.6% over FY2007. The net profit was $195.2 million in FY2008, an increase of 15.5% over FY2007. In the first fiscal quarter of 2009 (April 2008-January 2009) sales increased by $11.2 million.
• In 2008 Trojan had a 70% market share in the prophylactic industry world wide; no other company even comes close.
• The increasing consumer awareness of risks of sex has led to an increase in the use of the product.
• The product is relatively easy to obtain and inexpensive compared to other forms of birth control, such as birth control pills, which have to be obtained from a doctor and take an initial three months of continued use to work properly and then have to be taken on a regular basis, whereas the condom is used only when needed.
• Channels of distribution have been created to have an effective line of communication with prospective buyers to ensure that the benefits of the product are being disseminated effectively. They provide literature on how to use the product properly and they provide the product for free to high risk groups at free clinics.

Weaknesses

• The industry has high economies of scale and the capital investments are high while the variable costs are too low, making it a high volume, low cost business.
• Establishing the brand image in countries that do not allow birth control products in advertisements can be a challenge.
• Some consumers find the product unpleasant and may not use it.
• Condoms are not 100% effective and can break.
• Trojan cannot advertise on certain platforms and they are restricted to only advertising on TV late at night.
• Trojan Condoms, are known worldwide, but are not the dominant condom used in most foreign countries.

Opportunities

• They can aid the global community by increasing personal care product sales throughout Africa and reducing the spread of AIDS.
• Expansion of product line and brands, expand into a non-profit segment.
• Increasing use of condoms in India and South Korea, makes them attractive markets.
• Products can be sold in multiple outlets: home delivery, online, hospitals, supermarkets, medical facilities, free clinics, hotels, club bathrooms.
• Expanding sales to Amsterdam, where they are well known for a more laid back, open-minded lifestyle and sexual activity is accepted more than other countries and condoms are not the top selling form of birth control. It is an international market that only has one other brand of condom available. Prostitutes in the red light district are licensed and completely legal, which also means that prostitutes have access to medical care. Medical care is an important channel for sex education for the employees of the sex industry. The progressive style and thought process in Amsterdam could be a successful way of increasing Trojan condom purchasing and usage.

Threats

• There may be religious, cultural and social restrictions among certain groups that object to utilizing birth control methods.
• Trade restrictions, and the costs of obtaining certifications and establishing sales locations in some countries can be excessively high.
• There are several substitutions for condoms, such as birth control pills, sterilization and IUD's.
• The education level and attitude of the consumer can lead them to avoid using the product, especially among high risk groups such as teenagers.

by Mkt Teachers