10/9/2015

HowGilletteinnovatedandimproveditsmarketshareinIndia

Sharpfocus
ThiscasestudylooksathowGilletteinnovatedbytailoringadvertisingandinventinganewproduct
developmentprocesstoreflectlocalshavinghabits.
ByGabrielaBerner,JadeChang,MarinaDunaeva,andLeonardoScamazzoDelhiEdition:April13,
2014

WERECOMMEND
MotorolalaunchesMotoXStyle
inIndiaforRs29,999
FlipkartvsAmazon:Thebattleis
onfromOctober1317
Moody'sassignslowest
investmentgraderatingtoM&M

Photo:Reuters

ExecutiveSummary:Traditionally,Gillettereliedonextensiveresearchand
developmenttocreateasingleproductforglobaldistribution.Theproductwas
supportedbyamarketingpremisethatitwouldbeequallyvaluabletocustomers
globally.ButGillettesetasideitsglobalstrategyinIndiaandgrewitsmarket
sharedramatically.ThiscasestudylooksathowGilletteinnovatedbytailoring
advertisingandinventinganewproductdevelopmentprocesstoreflectlocal
shavinghabits.
GabrielaBerner,JadeChang,MarinaDunaeva,andLeonardoScamazzo.
AlthoughGilletteenteredtheIndianmarketin1984andlauncheditsnewesttriple
bladesystem,Mach3in2004,saleswereflatforalongtime.Theproductdidnotgo
throughanychangesandkeptitskeyfeaturessuchaslonglastingdiamondlike
coatingblades,'PowerGlide'smoothness,ergonomichandles,pivotingprecision
headsandpremiumprice,whichwas10timesmorethanitstwoblade
competitors.

data:text/htmlcharset=utf8,%3Cdiv%20class%3D%22headline%22%20style%3D%22margin%3A%200px%3B%20padding%3A%200px%3B%20color%3A%2

1/8

10/9/2015

HowGilletteinnovatedandimproveditsmarketshareinIndia

Eventhoughthetargetcustomerswereprofessionalmenwithhigherdisposable
incomesthantheaverageIndian,thetraditional,doubleedgedrazor,couldnotbe
dislodged.Indianmendonotconsidershavingasignificantenoughactivityto
justifysuchapremium.Gillette'sMach3valuepropositionwasbasedonextensive
consumerresearch,whichhighlightedkeyconcernsmenhadaboutshaving:itwas
timeconsuming,causedskinirritationandwasgenerallyunpleasant.Mach3
promised"theclosestshaveeverinfewerstrokeswithlessirritation".Research
anddevelopmentservedasthekeyvaluenetworkcomponentsupportingthisvalue
proposition,asitwascrucialtodeliverthepromisedperformance.Manufacturing,
distribution,marketingandadvertisingweregearedfortheglobalintroduction
throughincreasedproductioncapacityandalignedpromotionalmaterial.
Withsuchindifferencetowardsshaving,Gillettehadtofocusonchangingthe
consumer'sattitude,leadingtosomecreativemarketingcampaigns.Forexample,
thelaunchofthenewestGilletteMach3in2009wassupportedbythe'ShaveIndia
Movement2009'campaignwhichincludedseveralinitiatives.Gillettecreatedthe
platform'IndiaVotes...toshaveornot'tosupportthiscampaign,whichaskedthree
controversialquestions:Arecleanshavenmenmoresuccessful?Didthenation
prefercleanshavencelebrities?Andthebigone:dowomenprefercleanshaven
men?Fortwomonths,variousmediachannelspickeduponthecampaignandran
interviews,discussions,editorialsandnewsstories,whichtriggeredpopular
interest.Themainpurposewastocreateadebatearoundshaving.
ThecompanycreatedtheWomenAgainstLazyStubble(WALS)association,where
womenwereencouragedtoasktheirmentoshave,capitalisingontheirroleas
data:text/htmlcharset=utf8,%3Cdiv%20class%3D%22headline%22%20style%3D%22margin%3A%200px%3B%20padding%3A%200px%3B%20color%3A%2

2/8

10/9/2015

HowGilletteinnovatedandimproveditsmarketshareinIndia

influencersofmeninthisaspect.GilletterecruitedBollywoodcelebritiessuchas
ArjunRampalandNehaDhupiatosupportthecampaign.Thisinnovativewayof
marketingprovedtobeeffectiveandasawarenessgrew,salesandmarketshare
increasedby38percentand35percentrespectively.
Until2010,GilletteIndiahadbeenfollowingastrategyofmarketingcheaperend
USdevelopedrazors.However,lowincomeIndiancustomerswhocouldnotafford
Gillette'spremiumpricereliedontheoutdated,buttraditional,doubleedgedrazor
shavingsystems.Anestimated400millioncustomersnothappywithexisting
marketofferingsprovidedapromisinggrowthopportunityforGillette.Thus,it
focusedonunderstandingitscustomersandthechallengestheyfaced,which
requiredspendinghoursvisitingandinterviewingconsumersinorderto
understandtheroleofgroomingintheirlivesandtheirneeds.
Thecompanyrealisedthatapartfromaffordability,customersalsovaluedsafety
andeaseofuse.Thosecustomers'needswouldnotbesatisfiedbyGillette'sexisting
offeringmostlackedrunningwater,hadtomanagelongerfacialhairandsiton
thefloorwhileshaving.Norweretheysatisfiedwiththeexistingdoublerazor
solutionastheycausedfrequentcuts.
OnceGilletteunderstoodthisconsumersegment,thecompanycreatedanew
customisedproduct.GilletteGuard,thefirstproductcreatedjustfortheIndian
market,wasintroducedinOctober2010.ItwaspricedatjustRs15perrazorless
than35centsandthreepercentofthetopoftherangeFusionProGlideprice.At
Rs5forarefillcartridge,GilletteGuardmetcustomerexpectationsonsafetyand
easeofuse.
GillettemadeseveralchangestoGilletteGuardfromthetraditionalrazorsystems
producedinthedevelopedworld.Extrabladeswereeliminated.GilletteGuard's
singlebladesystemdoesnotfollowthetrendofincreasingthenumberofbladesin
arazormadefordevelopedcountries.Designcomplexitywasreduced.Gillette
Guardisamuchsimplerdesignwithfewerpartstoassembleduringthe
manufacturingprocess.
Featuressuchaseasyrinsecartridgesandlightweight,ribbedhandleswere
designed.Easyrinsecartridgeshelpcustomerssavewaterandensuretheblades
areclean,evenifrunningwaterisnotavailable.Thenewhandlehasabettergrip,
data:text/htmlcharset=utf8,%3Cdiv%20class%3D%22headline%22%20style%3D%22margin%3A%200px%3B%20padding%3A%200px%3B%20color%3A%2

3/8

10/9/2015

HowGilletteinnovatedandimproveditsmarketshareinIndia

makingtheexperienceeasierandsafer.Safetycombandhangholeinthehandle
wasintroduced.Designingasafetycombtacklestheproblemoffrequentcuts,
especiallyformenwhoarenotdailyshaversanddealwithlongerhair.Thehang
holewasintroducedasaresponsetolessconvenientconditionsandtoallowfor
easydryingandstorage.

Theresearchanddevelopmentprocesswasreinventedtocomeupwiththeproduct
data:text/htmlcharset=utf8,%3Cdiv%20class%3D%22headline%22%20style%3D%22margin%3A%200px%3B%20padding%3A%200px%3B%20color%3A%2

4/8

10/9/2015

HowGilletteinnovatedandimproveditsmarketshareinIndia

tailoredtotargetcustomers'needs.Simplifieddesignmeans80percentfewerparts
areusedinproductioncomparedtoGilletteVector.Thishelpscutmanufacturing
coststoensurethatthelowpricedoesnotinterferewiththebusinessmodel's
sustainability.Apartfromresearchanddevelopment,GillettealsobuiltGuard's
distributionnetworkacrossmillionsofsmalllocalshops,whereitwasmorelikely
toreachitstargetcustomers,ratherthanbiggerretailchains.Thisensuredawide
distributionreach.
Unliketheheavydigitalmarketingstrategiesusedinthedevelopedworld,the
campaignforpromotingGilletteGuardwasbasedontraditionaladvertisements
featuringBollywoodactors.Additionally,thesuccessofchangingIndianmen's
shavingcultureplayedasignificantroleinmarketingGilletteGuard.Asthefirst
productdesignedformenspecificallyinthismarket,GilletteGuardistoutedas
"oneofthemostsignificantproductlaunchesinGillettehistory".
Gillette'ssuccessinIndiahingedonitscapacitytoinnovate.Firstly,itused
innovativewaystocommunicatewithitsconsumersin2009inordertoattracta
onceindifferentsegment.Throughacreativeuseoftraditionaladsandmarketing
campaignsthatsupportedthelaunchofthenewGilletteMach3,Gillettewasableto
changeconsumers'indifferencetowardsshavingandcreateatruemomentumfor
itsproducts.Inthisway,Gilletteshiftedfromamarketdriventoamarketdriving
approach.
Secondly,in2010,GillettedidsomethingtheHarvardBusinessReviewdescribed
as"reverseinnovation"todevelopaproductthatwouldsatisfytheneedsofthe
lowerincomecustomer.AfterfailingtogainsignificantmarketshareinIndiaby
sellingitslowerandmidtierAmericanrazorsindifferentpackaging,Gillette
adoptedadifferentapproach.Itwentbacktothesourcebymakingsignificant
investmentsinmarketresearchtobetterunderstandtheneedsandpreferencesof
targetconsumers.
GilletteunderstoodthatIndianconsumers'needs,cultureandattitudetowards
shavingwereradicallydifferentfromthoseofWesternconsumers.Ratherthan
loweringperformance,Gillettekeptthevaluedcustomeratthecoreofitsstrategy
andintroducedaninnovativevaluepropositionforthevalueformoneycustomer.
Moreover,Gillettewasabletodeliveritspromisetocustomersbyputtinginplace
data:text/htmlcharset=utf8,%3Cdiv%20class%3D%22headline%22%20style%3D%22margin%3A%200px%3B%20padding%3A%200px%3B%20color%3A%2

5/8

10/9/2015

HowGilletteinnovatedandimproveditsmarketshareinIndia

anappropriatevaluenetwork.Inadditiontoacustomisedproduct,alltheelements
ofthebusinessmodelwerecoherentwiththevaluepropositionandmutually
reinforcing.
LocalmanufacturingenabledGillettetoloweritscoststructureandmaintainlow
prices.Thedistributionmodel,notbasedonfewlargeretailers,butonmillionsof
localshopscalledkiranas,allowedGillettetoachieveahighermarketpenetration.
TheGilletteGuardcaseinIndiaisthetypicalsuccessstorysuitableforamarketing
strategybook.However,therearesomeaspectsofthestrategythatappeartobe
controversial.Oneisrelatedtoenvironmentalsustainability.Guardusesdisposable
cartridgeswhichmakesitnotexactlyanenvironmentallyfriendlyproduct.
Secondly,Gillette'sbusinessmodelinIndiashowssome
weaknesses.EmergingmarketssuchasIndiaareknown
forproducinghighvolumesofgenericproducts.Given
thelowbarrierstoentryintherazorbusiness,thereare
somedoubtsabouthowGillettewillsustainits
competitiveadvantage.Innovativestartups(e.g.
DollarShaveClub)aregrowingfastintheUSbyselling
simpletwobladerazorsonlineatafractionofGillette's
price.Alowerpriceismadepossiblebyasimpleproduct
designandlimitedmarketingandoverheadcosts.Itis
possiblealowcostcompetitorwillentertheIndian
market,challengingGillette'smarketshare.
Toremaincompetitive,Gillettemustkeepthevalued
customeratthecoreofitsstrategyandadaptitsbusiness
modelaccordingly.

Amistakethat
multinationals
makeistopush
globalbrandsina
onesizefitsall
strategy.Gillette's
strategyof
spendingtime
andresources
understanding
Indian
consumers'needs
provedtobethe
keytoitssuccess.

OthercompaniescanlearnfromGillette'scaseinIndia.Arecurrentmistakethat
multinationalsmakeistopushglobalbrandsinaonesizefitsallstrategy.Gillette's
strategyofspendingtimeandresourcesunderstandingIndianconsumers'needs
provedtobethekeytoitssuccess.Thisunderstandinghelpeditinnovatethrough
developingnewproductsandcreativecommunicationwaystoattractandengage
Indianconsumers.
data:text/htmlcharset=utf8,%3Cdiv%20class%3D%22headline%22%20style%3D%22margin%3A%200px%3B%20padding%3A%200px%3B%20color%3A%2

6/8

10/9/2015

HowGilletteinnovatedandimproveditsmarketshareinIndia

'Usingsocialnormsorevokingsocialissuesisa
riskybusiness'

Itcouldhavechosentoinform
peopleofthebenefitsof
shavingingeneralorofusing
theGilletteproductforits
benefits.Insteaditchoseto
evokesocialnorms:David
Faro,AssociateProfessorof
Marketing,LondonBusiness
School

Howdoyoumakeanationchangeitsshavinghabits?The
Gilletteexampleshowssomedegreeofsophisticationin
understandingthewaypeoplemakedecisions.Sincethe
newproductwouldentailachangeinhabitualbehaviour,
easewascrucial.Weseethiselementfeatureintheir
productdesignaswellasintheirchoiceofdistribution
channel.Intermsofadvertising,Gillettecouldhavechosen
toinformpeopleofthebenefitsofshavingingeneralorof
usingtheGilletteproductforitsbenefits.Insteaditchose
toevokesocialnorms,takingintoaccountwhatweknow
abouthumanbehaviour.
Usingsocialnormsorevokingsocialissuesisarisky
businessandconsideredevenmoreperilouswhendoneby
aforeign
playerinthemarket.Itrequiresagood
understandingofthesocialcontextandoverridingof
stereotypes.Comingfromoutside,wemayseelocals
asmorehomogenousthantheymightbe.Lastly,itrequires
goodexecution.Evokingsocialnormscaneasilyendup
heavyhanded,andbeperceivedso,especiallywhendone

byaforeigncompany.
AnimportantelementintheGillettecaseisthecustomisationoftheproducttolocal
needs.Thismakessensewithseveralcaveats.Thechangesarecostly.Therefore,there
oughttobedifferencesinlocalneedsthataresubstantialenoughtowarrantthechange.
Second,thesizeofthemarketshouldbebigenoughtojustifytheeffort.Lastly,the
companyshouldhavetheresourcestofollowthroughthechange.Itshouldalsotakeinto
accounttheriskthatlocalinnovationcancomeattheexpenseofcentralisedinnovation.
DavidFaro,AssociateProfessorofMarketing,LondonBusinessSchool
'Importingproductsandbesttradepracticesisnot
enough'
With1.25billionpeopleandalivelyeconomy,itissensible
forcompaniestohaveIndiaaspartofanyglobalgrowth
strategy.Butsuccessfullycapturingthisgrowthiseasier
saidthandone.Youcannotdominateanyconsumergoods
categoryinIndiasimplybyimportingproductsandbest
tradepracticesfromelsewhere.Gillettehasbeenwillingto
putinthehardworktounderstandIndiainallitsvastness
anddiversity,andhas,therefore,metwithsuccessafter
2009.
Foryears,marketingbrainswonderedwhyIndianmen
data:text/htmlcharset=utf8,%3Cdiv%20class%3D%22headline%22%20style%3D%22margin%3A%200px%3B%20padding%3A%200px%3B%20color%3A%2

7/8

10/9/2015

HowGilletteinnovatedandimproveditsmarketshareinIndia

stubbornlyrefusedtoditchthehumbledoubleedgedblade
fortheconvenienceofasystemrazor.Theanswerwas
easilyavailablewiththeaverageIndianconsumer.But
someonehadtounderstandlocalnuancelikeIndian
meninsmallertownssitonafloorwithacupandshave
andaffordabilitywasanissue.AndGillettewaswillingto
listen.Smalltoucheslikeatexturedhandleforafirmgrip
todealwiththickerthanaveragehairandahangholeforconvenientstoragecateredto
uniqueIndianneeds.
Gillettehasbeenwillingtoput
inthehardworktounderstand
Indiainallitsvastnessand
diversity,andhas,therefore,
metwithsuccessafter2009:
DevendraChawla,CEO,Food
Bazaar

ItisaclearcaseofashiftinMNCthinkingfrompeddlingtheirlowestcostproductsto
understandingtheIndianconsumer.Oneoftheworldsbiggestsoapbrandsmadea
bigmistakewhenitlaunchedbathinggel,thinkingtheconsumerwantedtoupgrade.
However,itlearntlackofrunningwatermaderemovalofgelharderandneededmore
bucketsofwater,leadingtothefailureoftheproduct.Itsareminderofthe
importanceofknowinglocalculture.Iamnotsurprisedtodaytwooutofthreerazorssold
inIndiaareaccountedbyGuard.
DevendraChawla,CEO,FoodBazaar

data:text/htmlcharset=utf8,%3Cdiv%20class%3D%22headline%22%20style%3D%22margin%3A%200px%3B%20padding%3A%200px%3B%20color%3A%2

8/8