A. CASE ANALYSIS
I. Affirmation of the Issue
How can Gillette Company keep and improve its earnings?
1 . To reinvigorate the blade-and-razor system market although keeping the lead in the disposable razor market.
2 . To build up strategies which will continue to maintain and raise the market share.
a few. To maximize earnings of the business.
III. Examination of Case Facts/SWOT Examination
1 ) Gillette made the blade-and-razor system.
2 . Has always been an industry innovator, with ample spending budget allocation pertaining to Research & Development. several. Gillette provides cartridge devices, electric shavers, and disposable blades. 5. The company features strong worldwide capabilities.
five. Gillette's support of athletics gets very good response from your market. 6th. Gillette introduced its product to the US military which usually created a big market of self-shaving people. 7. Gillette has embarked in general personal combing.
8. Items of Gillette are known for the " great quality".
being unfaithful. Paul Hankins and Sean Pear can charge a strong leadership in the organization with strict control over merchandise costs, overhead expenses, and working capital.
1 ) Gillette's market share is switching to disposable razors from its cartridge system. 2 . Gillette's electric shavers are manufactured by Braun.
a few. Gillette provides multiple blade-and-razor systems but their cartridges are not interchangeable with their other models. 4. Gillette's effort in 1980's was not synchronized having its goal. That introduced more new throw-away razors and product advancements while it really wants to regain the market to get blade-and-razor system where it may get three times more profit than disposable razor. a few. Spending on Blade and Razor advertising features drastically reduced over the years. 6. There is a low morale within the company.
7. Gillette's global team is definitely not well-coordinated.
8. Program razor is heavier than disposable razor blade.
1 . There is a constant increase in awareness of self-shaving. installment payments on your The sale for private care products might continue to increase. 3. Personal grooming in beauty shops or klipper (daglig tale) shops remains expensive. four. Retailers prefer to sell blade-and-razor system than disposable razor blade. 5. The market for women-shaving is not yet fully tapped and this commands a powerful consumer market.
1 . The inevitability of the disposable razor to get more & more market share. 2 . Electric shaver is the fresh razor technology.
3. Beginning of new players in the razor industry just like Schick and BIC. some. Consumer's preference for a low-priced product just like products offered by BIC. five. Though Gillette is constantly searching for, the vulnerability to copying by the competitors is very large. 6. Total US economy is decreasing in the late 1980's.
7. Susceptibility to unfriendly take-over produced lost in focus on the management part and increases the debt-to-equity ratio.
IV. Option Courses of Actions
1 . Portion the market and provide value to prospects segments offering for the higher quality products; at the same time enhance the marketing strategy emphasizing the brilliance and the good reason that should buyer will select the system razor over throw-away ones.
a. Distinct target market segments will be labeled according to consumer desire therefore efforts and solutions will be focused effectively per market segment. b. Not merely one in throw-away and program razor market is abandoned -- both two markets represent a rewarding source of income for the company. c. The market of women-shaving will probably be tapped.
d. Focused advertising will have an excellent possibility of creating new awareness in personal grooming just as the strategy employed in the US armed forces.
a. Reinforcing the machine razor means high advertising and marketing expense, when the company noesn't need a budget. m. Effort in advertising is definitely not a guaranteed success for the reason that future speaks of the throw-away razor.
2 . Enliven the system...