Gillette and the Men’s Wet

Shaving Market

Group 6
Section B
Gillette – S(h)aving Men Since 1903

Innovation at the Heart of Growth

1938 1962 1977
Thin blade Sterliton Atra

1932 1959 1971

Blue blade Super Blue blade Trac2

• King C.Gillette invented the safety razor systems 6

in 1895 32 Safety Razor-61
• Permanent razor handle – replaceable blade 23 Stationary-9
systems Cosmetics-14
• Huge invention – Changed the way men perceived Braun Products-13
shaving 11
• Dominated the market 28 Oral B-3

• Concentrated on Advertising and Distribution

US Men’s Shaving Market

US Men’s
Shaving Industry
(100%)

Wet Shaving Dry Shaving

Market (75%) Market (25%)

Gillette BIC Wilkinson Sword Schick

(62%) (12.7%) (4%) (16.2%)

Permanent Disposables Injectors Permanent Disposable Injectors

(56%) (24%) (10%) (54%) (25.2%) (21%)
Competitor Analysis

Leader in the Injection shaving market – controls over 80% of the

market
Late entrant in the disposable shaving market
Entered with narrow headed disposable razor – Slim Twin in 1988
67% of its revenues are overseas – mainly Europe and Japan

Mainly concentrated in the disposable market segment

Main Product – BIC shaver for sensitive skin
Core philosophy – maximum service, minimum price
Planned to market only single blade disposable razors

Entered with Super Sword edge – blade with a steel coating

Introduced Ultra Glide to compete with Gillette’s Atra Plus – priced at
5-8% lower
Competed head on with Gillette in advertising – used comparative
advertisements
Current State – Move Towards Disposables

The Shift

• 1980s: Consumers chose inexpensive disposable razors

• Gillette helped to foster trend : Focus on price, not quality

• Mainly preferred by the younger customers who do not perceive the differences
between the system and disposable blades

The Consequence

 Disposable razor market reaches 41% of total market by 1988

 Loss of quality image, loss of profit

 *Gillette taught consumers the best razor was the cheapest one!
Situation Analysis

Dollar sales (Gillette products)

Sales of Atra blades have leveled off & Trac II is
declining

Less focus on advertising – only what was left over

was spent on advertising

One half of advertising spent on Atra and rest spent

on Good News

Same themes for both system razors and disposables

– ‘Essence of Shaving’

90% product based and 10% image based advertising

Men over forty have strong connection with Gillette

Strong connection between Gillette and male image

of shaving
Younger men prefer disposables – feel all razors are
the same
Gillette logo does not give a masculine feel
Woman identify Gillette name with men and shaving
Future ahead:
1. Do nothing: Let disposable take more and
more share
2. Buck the Trend- Introduce product
innovations in system razor and shift the
consumer perception from price to quality.
Is Disposables the Way Forward?

Disposables represent a high
volume business
The disposable shaver
segment is growing at a fast
rate
Therefore focusing
on disposables will
lead to a constant
price war, and may
also lead to erosion
of Gillette’s brand
equity

The disposables was

a short term solution
Every 1% change to disposables = $10m hit
Further focus on
One third of system razors’ margin
creating low cost low
Costlier to manufacture
margin products will
erode profitability
Commoditization  Price war
Hence Gillette
Goes against the company philosophy of innovation should not pursue
this strategy
Core competency is their R&D prowess to get newer
blades and razor systems
Going the Razor Way

Higher Margins for the products

In line with Gillette’s core philosophy of
product innovation
Can leverage upon the brand
In line with Gillette’s broader strategy
Can focus all energies on the launch of
new system razor product

May lose out on the increasing

disposable shaving category – a sizable
chunk of the market
Strategy Ahead

High
International/
Transnational
Multi-Domestic Pan European success of
Local Market Contour Plus; Universal high
Adaption
Global Product
quality product; “a shave is a
International
Divisions shave everywhere”.
Low

Low Global Coordination High

• Product related performance associations in disposable razor

• Italian men perceive that disposable razors have high value despite their price
• Improve disposable razor’s quality with innovation and gradually increase margin

• Focus on women with the razor designed solely for women

• More women wet-shavers than men 62 million vs 55 million

• 12 blades a year is still a significant number
• Should introduce disposable razor for women
Positioning
• Change in marketing environment • Actively managing brand equity
• Shift in consumer behavior Calls • Adjusting marketing program to
• Competitive strategies for identify new sources of brand
• Technological advances equity

Position Gillette razor as superior product and relate it to ultimate shaving experience

• Intergenerational Influence
RETRO-BRANDING • “Share what you love with who you love”
• Captures the male segment between 15-19 years
• Reinforces the brand equity

Shift from Steel man vs plastic man to quality seeking shavers

• Disposable Razor • Disposable razor for travel and use on the go (Product Usage)

• Women Razor • “First razor designed solely for women”

Marketing Mix

Product Price
Disposable=Current Price
New Gillette>Current Price
Disposable Razors
Women Razor=Comparatively
New Gillette Razors high price than disposable
Women Razor

Place Promotion

Disposable- Product usage

Existing outlets & New Razor- Retro Branding
distribution network
Women Razors-First of it's kind