Gillette (case study)

One of the most basic necessities of a man for his personal use is his shaving kit. Very few companies are
as successful as the company started by KING C. Gillette (1855-1932) on September 28, 1901 in Boston,
MA as American safety Razor Company. The modern day traveler today encounters a Gillette product
portfolio far boarder and the worldwide presence far stronger than any envisioned by the Company’s
founder who patented his inventions of the razor in 1904.

WHAT IS UNIQUE ABOUT GILLETTE

Around 1.2 billion consumer’s per day use the company’s products. It has a market capitalization of US$
3.76 billion. It is ranked 129 by FORBES 500, 2002 issue. After Success in the US, King Gillette
expanded the company to UK, Germany, Denmark, Italy and Canada by 1920. The company introduced
brush less razor in 1937. Gillette introduced shaving cream in the US in 1940. For the first time the
company introduced razors for ladies in 1944. In 1952, the name of American Safety Razors Company
was changed to THE GILLETTE Company. The company diversified into stationary business by
acquiring Paper mate, a leading ballpoint manufacture in 1955 for $15M. Further venturing into personal
care it produced “Right Guard” deodorants in 1960. The company manufactured surgical manufacturer’s
hypodermic needles in 1962 at Reading, England. In 1964, the company strategically reorganized into
two broad lines: men’s products and others.
Gillette introduced stainless steel razors in 1965 across the US. To diversify into future brands, it acquired
Braun AG in 1967 and moved into small electric appliances. It acquired 48% stake in SA Dupont
Company and a manufacturer of luxury writing instruments and disposable lighters in 1971. For the first
time in history of shaving razors, the company introduced TRAC 2, a twin blade shaving system, in 1971.
Furthering its expansion operations, the company acquired “Jafra Cosmetics” in 1973 and increased stake
in SA DuPont Company to 80%. It introduced “Cricket” disposable lighters in 1974. “Daisy” a disposable
shaver was rolled out for women in 1974. “Good News” a disposable twin blade was introduced in 1976.
Gillette expanded ballpoint product line with “Eraser Mate” in 1979. This has the feature of erasable ink.
It acquired ORAL-B Labs Inc. in 1984. Revlon in 1986 is acquired. It acquired Waterman in 1987. It
then launched “Sensor excel” in 1992 and consolidated its stationary division by acquiring “Parker Pen
holdings Ltd” in 1993. It then acquired “Duracell International” in 1996 and launched “Power check”
Batteries. It also introduced MACH3 and Duracell Alkaline” in 1998. To dispose of non-profit making
divisions it sold its stationary products to “Newell Rubbermail”.

Vision and Strategy of GILLETTE

Mission Statement
The Gillette Company is a globally focused consumer products a marketers that seeks competitive
advantage in quality, value added personal care and personal use products. We are committed to building
shareholders value through sustained profitable growth.
Vision
To build total brand value by innovating. To deliver consumer value and customer leadership faster,
better and more completely than our competition.
Core Value
Integrity, Achievement, and Collaboration.
Global Competitors
Razors – Schick, Wilkinsons, American Safety razor and Bic Pen corp
Pens – BIC, SA Dupont, and Papermate.
Lighters – BIC and other local brands
ToothBrush – Colgate Palmolive, unilever and other Local brands
Batteries – Panasonic, Kodak,Maxell, Energizer and local brands
Electrical appliances – GE, Black n Decker, Philips and so on.
Gillette Strategy.
The strategy of Gillette revolves around stability, growth and retrenchment.
Stability
Diversification
High Profit margin
Implementation of employee metrics
Growth
Branding
R&D
Compete in growing
Retrenchment
Premium Pricing
Cost engineering

Glimpse of Gillette India

The company was incorporated on 9th Feb, 1984 at Rajastan as razor blades and shaving systems, jointly
promoted by the House of Poddar Enterprises (HOPE) and the Gillette Company USA with 24% equity
capital. The agreement provided for technical collaboration by Gillette over the full range of technical
know- how and technical assistance for the manufacture of razor blades, razors and shaving systems. It
was named India shaving products Ltd.

It is now called Gillete India (GIL) headed by Shri S.K poddar as chairman with shri zubair Ahmed as
MD. The board has ten members and two of them are foreign nationals.

The Blades manufactured by the company were of two types, the premium 7,O clock, super platinum and
the stainless brand 7oclock super stainless. In 1991 it took over Sharpe edge ltd after the approval of the
board. Now the company owns Wilkinson Brand in India as well. The total Market capitalization of the
company as of January 2003 is approx. Rs 9.5 Billion.

- Gillette India product portfolio consists mainly of the upper end male grooming products with
brands such as Gillette presto, sensor excel, march 3 and shaving gel.

- GIL has gained lower end shaving products such as 7oclock blades and Wilman shaving systems
with the merger of Wilkinson sword India with itself from Jan 2000.

- Duracell India and Wilkinson sword India was merged with the company effective 2000.

- In 2004 the company launched the next generation triple blade shaving system, Gillette mach
turbo and Gillette vector plus.
 - In the personal care segment the company has launched storm force after shave splash and new
ultra-comfort shaving gel and Gillette series tube shave gel variants.

Strategy Adopted by Gillette India.

- Focused on branding across the price lines
- Brand coverage – develop multiple products under the company brand umbrella
- Pioneering the PRESTO- a disposable razor
- Focus on volume sales in India
- Core Sector – Toilet Preparations.
- Heavy Investment in advertisement- Rs 16.25crore in 2002 (According to senior company
officials about 8-10% of the annual sales turnover of the company is earn marked for
advertisement and market promotion expenses.
- Apart from shaving products Gillette India’s core thrust areas are portable power products
comprising Duracell Alkaline batteries and oral-care business operating under Oral –B umbrella.
- Gillette India is focused on profitability and driving functional excellence.
- Main competitors in India are Reckitt Benckinser, BASF India and Henkel India.

1) According to the case what is the core business of Gillette, by using the Ansoff growth
matrix how would you define Gillette’s growth strategy?
2) According to the case study, your analysis and with the help of the BCG Matrix identify
their product/ brand positioning.