Whether the level of innovation has reached to peak for Gillette? Whether Gillette should reduce the price? What should Gillette do to fight low-cost competitors like Dollar Shave Club? What should be strategy for Gillette in long term

1. GILLETTE: WHY
INNOVATION MAY NOT
BE ENOUGH
(Case study analysis)

2. Gillette has long been known for innovation in both product development and marketing strategy. In the highly competitive,
but mature, razor and blade market, Gillette holds a commanding worldwide market share. The peak of its innovation
occurred in 2006 with the introduction of the Fusion 5-bladed razor. Today, innovation in razors and blades is thwarted by a
lack of new technology and increasing consumer reluctance to pay for the ‘‘latest and greatest’’ in shaving technology.
Gillette must decide how to put the razor wars behind them and maintain or increase its share of the global razor market. In
fact, the company was so visionary that it didn’t have any serious competition until 1962, when Wilkinson Sword introduced
its stainless steel blade. Since that time, the Wilkinson Sword–Schick Company has evolved into Gillette’s primary
competitor.
“Gillette has always prided
itself on providing the best
shaving care products for
men and women”
Founded Since 1901
Case facts and Synopsis
GILLETTE: WHY INNOVATION MAY NOT BE ENOUGH

3. Original Gillette
Safety Razor
1901
Gillette Trac II Razor
1975
Atra Razor, the Good News!
Atra Plus Shaving system
1976
Daisy Razor for women
End of 1970s
1990
Sensor for Women
1992
Gillette’s Innovation Timeline
GILLETTE: WHY INNOVATION MAY NOT BE ENOUGH
Sensor Razor Sensor Excel
1993
Sensor Excel for Women
1996
Mach3
Mach3 Turbo for Men
Venus for Women
1998
Fusion ProGlide
Styler
2012
Fusion ProGlide
shaving system
2010
Fusion
2006

4. GILLETTE: WHY INNOVATION MAY NOT BE ENOUGH
Gillette – A Victim of its own Success
GILLETTE: WHY INNOVATION MAY NOT BE ENOUGH
70%
1962 when Wilkinson entered the market
Move to generate more revenue
49%
The reduction in market share
Atra Trac-II Good News! Mach3 Fusion
No
• Higher margin on new products
• Pushing repeat purchase on cartridges
• Low priced razors with high priced cartridges
• More revenue generation with premium pricing
• Customers were made to believe more the blades better it is.
Strategic
Wilkinson Sword could not exploit the
niche it had created and hence Gillette
purchased their existing blade business.
As it wasn’t having enough resources
victim

5. Razor Wars
GILLETTE: WHY INNOVATION MAY NOT BE ENOUGH
Gillette missed out to changing consumer preferences
• Fusion 5+1 criticized- 5 blades not necessary for a good shave
• High priced- seen as novelty product
• Lack of loyalty- Razors outsold cartridge refills
Schick lost sight of consumer preferences , paid attention only to
competition and by being a small company lost out
Gillette revisited and restructured strategy-
• Convert consumers to high priced razors- Sensor, Sensor
Excel and Mach3
• Expand to new geographies-Romania, former Yugoslavia,
Soviet Union and Czech Republic
Schick took away some of Gillette’s market share- rose by 2.9% to
17%
First Serious Competition
Wilkinson Sword's
Stainless Steel blade- sold
most blade business to
Gillette
1962 2003
Gillette sued
Schick for
progressive
Geometry used in
Quattro (4 blade)
Schick sued Gillette
for misleading slogans-
“The best a man can
get”, “the world’s
best shave”
Schick’s razors led to
fall in Gillette’s U.S.
razor and blades market
share by 4.3% to 63%
In 2006, Gillette
made a
comeback with
the Fusion, a
5+1 blade razor
2006

6. Blades Gillette Dollar Shave Club
Razor Cartridge Razor Cartridge
2 blades $1 5 for $3
3 blades $8.59 12 for $25.99
4 blades $1 4 for $6
5 blades $9.99 4 for $13.99
6 blades $1 4 for $9
Online Competition
GILLETTE: WHY INNOVATION MAY NOT BE ENOUGH
Dollar Shave Club –subscription model
• Standard Sizes- 2,4,6 blade razors
• Basics features for a good shave- stainless steel
blade, pivoting head, lubrication bar
• Convenient- Solution to purchase problem- Door
step delivery once a month
• Inexpensive
Hence DSC provides more value than Gillette
Private
Labels
Changing customer
preferences
Online
players
More
Awareness
Pricing
cheaper
Service
Innovation
{
New threat

7. Recommendations
GILLETTE: WHY INNOVATION MAY NOT BE ENOUGH
 Male centric brand
 Gender contamination- Men maybe using Gillette as a symbol of
masculinity. Incursion of products for females threatens that image
 Created different brand name for Gillette's products for women-
Gillette for Women
 Hardly advertises to women. Female based campaigns are targeted
towards men Eg. What women want, Soldiers For Women
“CREATING A WOMEN CENTRIC BRAND ALSO”
Recommendation:
 Create loyal women customers- Show women as independent and
capable without men in their lives
 Promotion with female sports teams/ persons, superstars or
actresses to appeal to women
SHIFT THE FOCUS FROM ‘SHAVING’ TO GROOMING
Types of Male consumers –
 Don't shave regularly
 Don't just want to grow a beard but experiment with facial hair shapes
and styles
Recommendation
 Expand range of products over the grooming business
 Provide complementary products to give a complete experience.

8. Recommendations
GILLETTE: WHY INNOVATION MAY NOT BE ENOUGH
 Product innovation in razors/blades has reached its peak.
 People looking for more basic products, due to their
inexpensiveness
INNOVATION IN COMPLEMENTARY PRODUCTS
Recommendation:
 Focus on innovating complementary products so that the customer
need not shift brands.
 Focus on R&D to develop products requiring less or no water usage.
E.g.: Dry shampoos, Beard washes etc.
PARTNERING WITH E-COMMERCE/AMAZON
Currently it is serving the market through–
 Retail outlets
 Online
Recommendation
 Gillette can look at proving doorstep service and innovating the
process of delivering its products
 Make it more experiential.
 Tie up with Amazon and use Amazon Dash to identify when and how
the consumer uses its product and how frequently it needs to refill the
cartridges or buy shaving cream or gel.
For regular use the subscription is provided by Amazon on $2

9. Recommendations
GILLETTE: WHY INNOVATION MAY NOT BE ENOUGH
 In India Gillette executives spent 3000 hours at 1000 consumer’s
places during different times of the day before launching the
product Gillette Guard.
 No running water, darkness, safety issues, hanger hole to dry
CONSUMER BEHAVIOR BASED INNOVATION
Recommendation:
 Consider the roles of culture, religion, and western influences in
shaving behavior.
 Being aware of these cultural and behavioral characteristics will help
Gillette effectively segment and target customers.
 Targeting the rural areas and new geographies based on localization
SERVICE BASED MODEL FOR URBAN CUSTOMERS
Competition to look out for -
 Harry’s, which is best thought of as a sort of Warby-Parker for razors
with grand ambitions.
 Dollar Shave Club, a low-concept, brand that aims to take the thought
and cost out of shaving.
Recommendation
 Look at providing doorstep service and innovating the process of
delivering its products.
 Make it more experiential at low prices.
 Consumers should also be able to sign up for shave plans or rewards.

10. Recommendations
GILLETTE: WHY INNOVATION MAY NOT BE ENOUGH
 Lifebuoy campaigns to wash hands 5 times a day increase the
consumption
 Encouraging more use of shaving rather than describing the
benefits of Gillette products
ENCOURAGE MORE USAGE BY EVOKING SOCIAL NORMS
Recommendation:
 Inform people the benefits of shaving by evoking social norms to
change the consumer behavior.
 Design Marketing activities such as “Shave for Soldier “ that evoke
emotions to drive more usage of its products.
 Promote the idea so that shaving shouldn’t look like chore but an
experience.
PRICING STRATEGY
Current strategy- Low priced razors, high priced cartridges
Recommendation
Keep current pricing strategy in markets where
 Online players have not entered
 Preference for low priced private label brands is low
 Demand for Gillette Razors is inelastic due to high customer loyalty
Reduce prices (squeeze margins) to
 Match the prices of online entrants
 Retain market share
 Reduced prices with a subscription scheme can benefit Gillette by
o Guaranteed sales- High switching costs due to long term
subscription
o Increasing blade usage- Reduction is usage of blade past it’s life