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The Gillette Company Marketing Plan

Essay by review  •  November 29, 2010  •  Business Plan  •  2,062 Words (9 Pages)  •  1,745 Views

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The disposable Gillette Sensor 3 Razor with incorporated gel for men

Gillette's $9.2 billion global business began on September, 1901 by the name of "American Safety Razor Company. In 1902 it was names Gillette Safety Razor Company. The Gillette Company today is the global market leader in nearly a dozen major consumer products categories, principally in the grooming, alkaline battery and oral care businesses. It is the largest known company for producing razors and other shaving products. The five different business units Gillette focuses on are Blades & Razors, Duracell, Oral Care, Braun and Personal care. This project deals with the production of a disposable razor with incorporated gel. Gillette is the largest well known company for producing razors. The company receives the greatest profits from that operation. Gillette sells products in over 200 countries and has approximately 28,700 employees, 70& from which are outside of the US. Manufacturers operate at 31 facilities in 14 countries and 40% of sales come from NEW products for 11 consecutive years.

The Gillette Company's Vision is to build Total Brand Value by innovating to deliver consumer value and customer leadership faster, better and more completely than their competition. This Vision is supported by two fundamental principles that provide the foundation for all of our activities: Organizational Excellence and Core Values.

Organizational Excellence is accomplished by superior and continually improving performance in every area and at every level of the organization. Gillette's performance should be guided by a clear and concise strategic statement for each business unit. Excellence requires hiring, developing and retaining a diverse workforce of the highest caliber.

The three core values that define the way Gillette operates are achievement, integrity and collaboration. They are dedicated to the highest standards of achievement in all areas of Gillette's business and strive to consistently exceed the expectations of both external and internal customers. Mutual respect and ethical behavior are the basis for Gillette's relationships with colleagues, customers and the community. Fair practice is the hallmark of the Company. In Gillette they believe in working closely together as one global team to improve the way they do business every day. They communicate openly and establish clear accountability for making decisions, identifying issues and solutions, and maximizing business opportunities.

In 2004 Gillette earned a profit of 42% from Blades and Razors. 21% came from Duracell, 15% from Oral Care, 13% from Braun and 9% from Personal Care. In 2005 the profit from Blades and Razors was even higher at a 63%, while 19% came from Duracell, 10% from Oral Care and both Braun and Personal Care offered a 4% profit to Gillette.

As far as the geographical point of view Gillette had 38% of Net Sales in North America, 34% in Europe, 11% in Africa-Middle East, 10% in Asia Pacific and 7% in Latin America.

The Gillette Company is committed to being a good corporate citizen. They have demonstrated this commitment through their donation of products, funds and employee volunteer efforts around the globe. They believe that Gillette's success as a global leader in the consumer package goods industry rests in part on their reputation as a committed community partner. The Gillette Company provides support through its Gillette FaceForward Grant Program.

Gillette is practicing social responsibility and has started being awarded for its actions from 1977 through 1994. In 1989 Gillette from Puerto Rico contributed $60,000 for hurricane (Hugo) relief, while in 1986 they have contributed $100,000 in Mexico for earthquake relief. Some examples are the "Governor's Environmental Achievement Award" that Gillette received in Massachusetts in 1990. In 1991 Gillette ranked #20 among fortune 500 companies and 2 years later Gillette vaulted into the 100 Fortune for the first time. Financial World ranked the Gillette brand as the ninth most valuable in the world in 1994.

Gillette has been growing at the rate of 4.52% of net sales over the last five years. Last year the company's sales decreased by 1.58% as a result of weakened foreign markets combined with exchange rate fluctuations. Gillette's main competitors are Colgate-Palmolive, Procter & Gamble, Pfizer's Schick Product Line, Energizer Holding Inc and Rayovac. On the one hand, compared to them Gillette has a low quick ratio of 0.4 and a low current ratio of 0.8 which means that they might have difficulties meeting their current financial obligations. However, on the other hand Gillette has a high net profit margin of 13.09% and a return on equity of 20.4% and this way the company manages to stay very profitable.

The introduction of the "Sensor 3 Gel" will help Gillette maintain its competitive advantage by introducing this product innovation before its competitors. With a support of a strong advertising campaign, Gillette will also increase consumer recognition, especially with the younger consumers. The company will be able to execute this alternative successfully since it already had previous experience with other razor systems, such as Sensor 3 or Blue II, which proved to be very successful in men's disposable market (3).

Introducing the " Sensor 3 Gel" will fit with the corporate culture of Gillette since it is consistent with the current strategic direction of the company of holding the leadership position n the grooming market. Also, this strategy will fit with Gillette's major, sustainable, competitive advantage of being an industry innovator (3). Manufacturing the "Sensor 3 Gel" will add value to the organization, as it will reposition the Gillette Company as the undisputable industry leader.

The "disposable razor" target market will be male population across the world. In 2002 more than 1.7 billion men over 15 years old removed hair daily with over 80% using a blade and a razor (2). These numbers show that there is a large market for razors worldwide. The "disposable razor" will first be manufactured with a regular shave gel to appeal to a large group of men. But in the long run, new and more focused groups will be targeted. Different shaving gels for different type of skins will be introduced.

The table below shows the type of gel and their target market (1):

Type of gel in the

"Sensor3 Gel" Target Market

* Regular

* Medicated

...

...

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