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1.

Introduction
1.1 Background of the study
Gillette is a brand of men's safety razors and other personal care products including shaving
supplies, owned by the multi-national corporation Procter & Gamble (P&G).
Based in Boston, Massachusetts, United States, it was originally owned by The Gillette
Company, a supplier of products under various brands until that company merged into P&G in
2005. The Gillette Company was founded by King C. Gillette in 1901 as a safety
razor manufacturer
Under the leadership of Colman M. Mockler Jr. as CEO from 197591, the company was the
target of three takeover attempts, from Ronald Perelman and Coniston Partners. On October 1,
2005, Procter & Gamble finalized its merger with the Gillette Company.
Gillette started out as a company of USA but within a short period of time it spread out its
branches all over the world and expanded itself. It took its business to an international level. To
conduct this feat successfully, a proper understanding of the international atmosphere of business
is needed. Gillette ran various activities all around the world. Though it initially started out as a
shaving appliance selling company, later Gillette expanded its expertise on to other products as
well, the sole objective of which was to improve the recognition of the organization worldwide.
But, such expansion requires co-ordination of all the activities and aligning them in a way so as
to earn maximum profit and establish worldwide recognition. All of this was possible due to
proper handling of the international business, doing the right thing at the right time and serving
the different nationalities around the world earning global recognition. Only proper
understanding of the global business and undertaking of the situation enabled this outcome.

1.2 Objective of the study


The Gillette Company is the world leader in the men's grooming product category as well as in
certain women's grooming products. Gillette maintains 64 manufacturing facilities in 27
countries, and its products are sold in more than 200 countries and territories, with more than 60
percent of sales occurring outside the United States.
The objectives of this study are
To know about international operations performed by Gillette
To analyze the secret of Gillettes running business in different cultures and different
societies
To know how Gillette instigates coherence between its global affairs to run business
smoothly.

1.3 Scope of the Study


This study focuses on the International business segment of Gillette. The analysis run in this
study fixates on the international operations run by Gillette and discusses on the activities those
help it run their international operations successfully.

1.4 Limitations of the study


Since this study focuses on the relationship between Gillettes activities and its success in
international business, the international affairs of Gillette falls under the limelight. Hence the
domestic affairs and business activities within the country are overlooked. This portrays a partial
image of the company.
This study is formulated from secondary data sources. This adheres to the legitimacy of the
study.
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2. Company overview
2.1 History
The Gillette Company is the world leader in the men's grooming product category as well as in
certain women's grooming products. Although more than half of company profits are still derived
from shaving equipment--the area in which the company started--Gillette has also attained the
top spots worldwide in writing instruments (Paper Mate, Parker, and Waterman brands) and
correction products (Liquid Paper), toothbrushes and other oral care products (Oral-B), and
alkaline batteries (Duracell products, which generate almost one-fourth of company profits).
Gillette maintains 64 manufacturing facilities in 27 countries, and its products are sold in more
than 200 countries and territories, with more than 60 percent of sales occurring outside the
United States.
The quest for a better way to remove facial hair or to shave has taken many twists and turns over
the centuries. The years between 1800 and 1900 have been coined the Golden Era of the
straight edge razor. Men went to barbers to have their mustaches and beards carefully trimmed.
Interchangeable blade-razor sets and seven-day sets were popular in the 1800s.
But it wasnt until 1901 that King C. Gillette fundamentally transformed shaving with the
invention of the first safety razor, which was granted a patent on November 15th, 1904. With the
advent of the safety razor, a man did not need to send his straight edge razor to the barber for
sharpening. The idea of clamping a smaller version of a straight edge onto a handle was genius
the blade was easier to control, which resulted in fewer nicks and cuts, and was replaceable when
it became dull.
In the past century, Gillette has been amongst the leaders in shaving innovations, delivering
cutting edge science and technology to consumers. When King C. Gillette introduced his
revolutionary safety razor, he founded a company on the time-honored credo, There is a better
way to shave and we will find it.
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Gillette remains true to this spirit even more than a century later and continues to deliver on that
promise with ground-breaking razors featuring innovative blade technologies from the Gillette
Trac II to Sensor, MACH3 and, of course, Fusion and Fusion ProGlide.
Today, Gillette has two dedicated R&D centers in Boston, USA and Reading, UK where most
of its product R&D takes place. The two R&D centers are amongst 14 such P&G facilities where
Gillette products are developed.
Its South Boston Manufacturing Center, known also as the Gillette World Shaving Headquarters,
has been the technical center for developing and manufacturing the newest wet shaving
technology platforms, using state of the art proprietary technology since 1903. The Reading
Innovation Center in the UK has been a world class innovation powerhouse that creates groundbreaking experiences that have delighted consumers since 1959.
Unique and diverse professionals drive with passion and creativity, a culture of learning and
technical excellence at Reading and Boston to lead scientific breakthroughs.
Current products

Mach 3 The first three-blade razor, introduced in 1998, which Gillette claims reduces
irritation and requires fewer strokes.
The Mach 3 featured five improved microfins and spring blades, a pivoting head with
greater flexibility and a blue lubrication strip that faded with usage to encourage users to
change their blades more frequently.

Mach 3 disposable. The above with a different plastic handle.

Mach 3 Turbo This razor was released in late 2001. It had ten microfins as opposed
to the five on the original, a new grip and claims improved lubrication and "antifriction" blades.

All Mach 3 blades are interchangeable between the three products in the range, so it is
possible to use the Mach3 Turbo blades on a Mach3 razor.

Mach 3 Turbo Champion has a slightly different handle design.

Mach 3 Power is a battery-powered version of the Mach3 Turbo razor which can
also be used with the power switched off. The blades differ from Mach 3 Turbo
with a new coating which Gillette describes as "PowerGlide".

Mach 3 Sensitive was awarded a 2012 Best New Product Award after being
voted 'Best in Show' in the program's awards in Mexico. The lubrication and
microfins are identical to Mach3Turbo. The Mach3 Power Nitro has a slightly
different handle design.

Venus is a female version of the Mach3. Mach3 blades can attach to a Venus handle and
vice versa.

Venus Divine is a female version of the Mach3 Turbo.

Venus Vibrance is a female version of the M3Power. Venus blades are


interchangeable across the line.

Venus Embrace is a five-bladed razor with a ribbon of moisture surrounding the


blades.

Venus Breeze is a three-blade razor with shave gel bars built into the head of the
razor.

Another version of the Breeze, the Venus Spa Breeze, is essentially the same as the
Breeze, but with a white tea scent to the shave gel bars

Venus ProSkin Moisture Rich, launched in January 2011 in the United States, is an
updated version of the Breeze, featuring Moisture Rich shave-gel bars that are
enhanced with a triple blend of body butters

Gillette Fusion is a five-bladed razor released in 2006. The Fusion has five blades on the
front, and a single sixth blade on the rear for precision trimming. Its marketing campaign
was fronted by the sports stars Roger Federer, Thierry Henry and Tiger Woods.

Gillette Fusion Power is a motorized version of the Fusion. The Fusion Power is
battery-powered and emits "micropulses" that are claimed to increase razor glide.

Fusion Power Phantom the Fusion Power Phantom (Stealth in UK) was released in
February 2007 and features a redesigned handle with a darker color scheme than the
original.

Fusion Power Phenom was released in February 2008. It has a new blue and silver
color scheme.

Fusion ProGlide and Fusion ProGlide Power were launched on June 6, 2010 in
North America.

The ProGlide series feature re-engineered blades with edges that are thinner than Fusion
and are finished with low-resistance coating which the company claims allow the blades
to glide more easily through hair.

Fusion Proshield Flexball released in November 2015: The blades have


lubrication before and after the blade it shields while you're shaving.

Fusion Power Gamer (also known as "Cool White" in select markets)

Fusion ProGlide FlexBall released in June 2014

The ProGlide FlexBall has a handle allows the razor cartridge to pivot. Gillette claims
that it means 20% fewer missed hairs, the ability to cut hairs 23 microns shorter, and 23%
increased skin contact.

2.2 SWOT analysis


Strengths
Gillette is a century old organization. There are various other brands affiliated with Gillette.
Gillette gained advantage by owning the knowhow and by owning a patent. It has high quality
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and innovative products. It has leading market shares in all core categories and high margins
relative to peer companies. It has different strategies with different kinds of products. That
ranging from product differentiation for some products, while low cost strategy for others. It has
a strong global presence and broad distribution network. It is related in diverse product lines and
businesses.
Weakness
The work culture in Gillette is an old corporate culture. It has lack of accountability and doesnt
live up to their promises. It has had declining growth and declining shares price from
19997.Advertising expenditures of Gillette has been reducing significantly while the selling,
general and administrative expenses rose significantly. Gillette has made unsuccessful attempts
in reorganization. It has diversified its activities into various other activities. This has made them
lose their focus.
Opportunities
There are various opportunities of Gillette to improve in the global market. Their product
diversity of Gillette should help it cover a large market over the years. Its international expansion
would improve the sales of the organizations and give the company a better way to reach their
products to customers. Gillette has its hands in both mature strong markets like Europe and
North America And also less mature markets like Asia, china Japan etc. This provides them the
opportunity to serve two different variety of customers and reap the benefits
Threats
One of the most prominent threats of Gillette is having to drop unusual product lines. The
industry being saturated with shaving materials, Gillette has to come up with some innovative
procedures. There are some political social economical threats related to international business.
There are high level of competition in the major markets (North America, Europe, japan, etc.).
Apart from that some false optimistic projections of the future needs might also hamper the
outcome of Gillettes needs.

2.3 PEST analysis


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Political factors
Breakdown of Soviet Union opened markets in the Eastern European countries such as Belarus,
Ukraine, Baltic, as well as central Asia and Transcaucasia countries and Russia.
Economic factors
A the companies expanded their operations into more countries, managing international currency
issues became more critical, AS competitors became more global , especially with the
introduction of Euro, the currency of the whole region would move together in a single direction.
Key emerging growth markets in Asia pacific, Eastern Europe and Latin America entered
recessions. They were currency fluctuations I Eastern Europe
Social factors
There were low population growth in the major geographic markets of the North America,
Europe and Japan. Cultural differences in less mature international markets influenced business
strategic decisions of Gillette.
Technological factors
Gillette is a century old company with a strong image and a well-known brand. The company
gained competitive advantage by issuing a patent and being the first of its kind in the market.
They had a knowhow and a technology that no one else did at that time.

3. Gillette and International Business

3.1 Globalization of Gillette


Globalization is an industry term that refers to preparing a product or service to be offered in
many markets or worldwide, taking into account the different aspects of doing business in
multiple countries, including, but not limited to: language, time zone, measurement standards,
cultural differences, etc.
Founded in Boston in 1901 by King C. Gillette, the Gillette Company was already selling in
eight countries by the start of World War I 13 years later. There are Today Gillette maintains 64
manufacturing facilities in 27 countries. more than 70 percent of Gillette's $6 billion in sales and
75 percent of its 31,000 employees are outside the United States. The company's impressive
financial performance is a result of its global growth strategy; profits grew 13 percent a year
from 1989 to 1994.
Global structure follows global strategies. Gillette restructured to strengthen its global focus after
the successful conclusion to a takeover battle in 1987-88, adopting a transnational" organization
for its core products similar to that of other global giants. North American and European shaving
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and personal care activities were grouped into one seamless trans-Atlantic body. The North
Atlantic group integrates all functions in North America and Europe, putting most of the
developed countries under one head. Gillette International focuses on the developing countries
Global structure follows global strategies. Gillette restructured to strengthen its global focus after
the successful conclusion to a takeover battle in 1987-88, adopting a transnational" organization
for its core products similar to that of other global giants. North American and European shaving
and personal care activities were grouped into one seamless trans-Atlantic body. The North
Atlantic group integrates all functions in North America and Europe, putting most of the
developed countries under one head. Gillette International focuses on the developing countries
Gillette managers acknowledge country differences but still prefer to treat the world as one.
"Language and social things are different," an executive said. "We try to get people to speak the
local language. But we also require operating committees in small countries to speak English."
3.2 Diversification of products to meet customer needs
The process of expanding business opportunities through additional market potential of an
existing product is called product diversification or diversification of products. Diversification of
a product could be achieved by entering into a new market or by adopting additional pricing
strategies. Often the product might be altered, improved or changed to satiate the needs of the
customers.
Gillette generally specialized in shaving products. But later Gillette entered into different
markets to earn more profit. The diversified markets that Gillette entered in were:

Batteries
Stationaries
Toiletries
Dental care
Personal care

There are various reasons that Gillette considered for diversifying its reach. These reasons
proved to be beneficial towards the international business of Gillette1. Cater to the new market: Despite being strong, Europe and North America were mature,
slow growing markets in Asia Pacific, Eastern Europe and Latin America entered
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recessions. There were currency fluctuations in Eastern Europe without meaningful


inflation during these periods. In 1999, the battery industry sales surged potentially, due
to consumers fear of potential Y2K power outage. So Gillette saw this as an opportunity
to enter into a new market and bought Duracell to enter into the battery industry.
2. To make Gillette popular in the International market: The more diversified its product
range, the more people will encounter the products of Gillette. It wouldnt be confined to
the product which sells shaving products only. This will increase the international
popularity of Gillette. This will help run international business in the long run.
3. Spread the risk: The risk of running an international business is huge. The business might
not comply well with the political, social or economic factors of the country in which
they are run in. These adverse effects could prove fatal if the company focuses on a lone
factor or product. So, product diversification paves the way to sustaining the business in
the long run in case a specific product line fails in an area. Thus Gillette diversified its
product range to reduce its risk factors.
4. To achieve economies of scale: By Economies of scale is the cost advantage that arises
with increased output of a product. Economies of scale arise because of the inverse
relationship between the quantity produced and per-unit fixed costs; i.e. the greater the
quantity of a good produced, the lower the per-unit fixed cost because these costs are
spread out over a larger number of goods. By adopting new product ranges, of the same
type, Gillette in a way reduces its fixed costs producing the products. Apart from that this
also enables Gillette to grasp on to a new market. This enlarges Gilletts market and
enables it to produce more product at a time and achieve economies of scale.
5. Avail competitive edge: Diversifying its product range gives Gillette another way to
approach its customers. This helps them satisfy the needs of the customers in various
ways. By adhering to this decision, Gillette avails competitive edge over the competitors.

3.3 Strategic positioning and value addition


Gillette is dedicated to driving innovative technology that will develop and produce hair removal
products that deliver a superior shave performance, both in closeness and comfort. Its male
image is masculine, confident and well groomed, while the female image is fun, youthful and

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energetic. Gillette is positioned at the premium end of the market, offering superior quality
products that set the grooming industry standard.
In essence, the Gillette Company celebrates world class products, world class brands and world
class people. It is committed to growth through innovation to maintain the company's position as
a world leader in the consumer products marketplace.
3.4 Global recognition gained from advertising through sports
Gillette has a rich sports heritage that provides natural synergies with our reputation as a
performance brand. Sports marketing plays an important role for the Gillette brand, helping us to
tap into a key passion for men and strengthening our connection with consumers.
Through the years, Gillette has had partnerships with many sportsmen, including world-class
athletes. Gillettes enduring association with sports goes as far back as the early 1900s. Gillette
had the vision to see the value in connecting the brand with top-tier sports and athletes. In 1910,
Gillette produced a print ad with images of baseball greats such as Pittsburgh Pirates infielder,
Honus Wagner, in ads for the original Gillette Safety Razor.
Joseph Spang Jr, who became president of Gillette in 1938, used all-out sports promotion,
beginning with the 1939 baseball World Series. From baseball, Gillette quickly moved on to
football, and snapped up the Orange Bowl and Sugar Bowl, and later the Cotton Bowl, and the
biggest collegiate spectacle of all, the Rose Bowl. However, boxing probably gave Gillette the
most payback for its advertising dollar because it delivered to an overwhelmingly male audience
suited to Gillettes overwhelmingly male product line.
It led in 1942 to the Gillette Cavalcade of Sports, Gillettes signature title for all its exclusively
sponsored sports events. Cavalcade of Sports presented nearly all the big national sports events
and was Americas premier vehicle for radio and television sports broadcasting for about 25
years.
The 1952 World Series would bring another memorable first the introduction of what was one
of the most effective television jingles of all time, To Look Sharp, every time you shave/To feel
sharp, and be on the ball/To be sharp
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For that same World Series telecast, Gillette introduced another ditty that was in the same league
as Look Sharp for its longevity and latter-day nostalgic recall. This was the: Howre Ya Fixed
for Blades of startled men in their undershirts caught in mid-shave, their faces lathered up and
razors poised.
Sharpie the parrot became one of Americas most recognized cartoon characters of the 1950s,
and for a while, was almost as well-known as Donald Duck and Mickey Mouse.
Over the years, Gillette has continued its efforts to increase involvement with top-level sports
beyond signature events by partnering with strong properties such as Major League Baseball,
NCAA Basketball, NCAA Football, NASCAR, PGA Tour, Champions Tour, LPGA Tour and the
National Hockey League.
Beginning in the 1970s, Gillette sponsored international events such as the FIFA World Cup,
rugby, the Gillette Cup in Cricket and Formula One racing.
In 2004, Gillette began a partnership with football star, David Beckham, which represented a
major enhancement to Gillettes sports marketing. Beckham was soon featured in the companys
worldwide consumer advertising and promotional campaigns and the platform clearly
transcended sports.
Three years later in February 2007, Gillette launched the Gillette Champions program that
highlighted the athletic and personal accomplishments of three of the worlds greatest athletes
Roger Federer, Thierry Henry, Tiger Woods as they personified the essence of Gillettes brand
and were known for their top performance, truly representing the best in their respective sports.
The Gillette Champions program was the largest sports-marketing initiative for the brand and
was rolled out to more than 150 markets through various marking initiatives.
Today, Gillette remains a strong supporter of the world of sports

3.5 Tackling with cultural differences


Differences in the culture could affect the business in various ways. For a business to succeed, it
needs cross cultural literacy. It means understanding of how the critical differences across and
within the nations can affect the business. A culture is generally a system of values and norms
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that are shared among a group of people and that when taken group believes to be good, right
and desirable. The culture of a country impacts on the economic business a lot.
Although Gillette entered the Indian market in 1984 and launched its newest triple-blade system,
Mach3 in 2004, sales were flat for a long time. The product did not go through any changes and
kept its key features - such as long lasting diamond-like coating blades, 'PowerGlide'
smoothness, ergonomic handles, pivoting precision heads - and premium price, which was 10
times more than its two-blade competitors.
Even though the target customers were professional men with higher disposable incomes than the
average Indian, the traditional, double-edged razor, could not be dislodged. Indian men do not
consider shaving a significant enough activity to justify such a premium. Gillette's Mach3 value
proposition was based on extensive consumer research, which highlighted key concerns men had
about shaving: it was time-consuming, caused skin irritation and was generally unpleasant.
Mach3 promised "the closest shave ever in fewer strokes - with less irritation". Research and
development served as the key value network component supporting this value proposition, as it
was crucial to deliver the promised performance. Manufacturing, distribution, marketing and
advertising were geared for the global introduction through increased production capacity and
aligned promotional material.
With such indifference towards shaving, Gillette had to focus on changing the consumer's
attitude, leading to some creative marketing campaigns. For example, the launch of the newest
Gillette Mach3 in 2009 was supported by the 'Shave India Movement 2009' campaign which
included several initiatives. Gillette created the platform 'India Votes... to shave or not' to support
this campaign, which asked three controversial questions: Are clean-shaven men more
successful? Did the nation prefer clean-shaven celebrities? And the big one: do women prefer
clean-shaven men? For two months, various media channels picked up on the campaign and ran
interviews, discussions, editorials and news stories, which triggered popular interest. The main
purpose was to create a debate around shaving.
The company created the Women against Lazy Stubble (WALS) association, where women were
encouraged to ask their men to shave, capitalizing on their role as influencers of men in this
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aspect. Gillette recruited Bollywood celebrities such as Arjun Rampal and Neha Dhupia to
support the campaign. This innovative way of marketing proved to be effective and as awareness
grew, sales and market share increased by 38 per cent and 35 per cent respectively.

3.6 Tackling social norms


During their reign in the international businesses, Gillette functioned in nations with social norms and
beliefs. This compelled Gillette to tweak their marketing scenes and product attributes. The people of a
specific culture may or may not be interested to products which are appealing to other societies. Their
way of thinking might not coincide. Gillette responded to this possibility and portrayed their product in
different ways to different international markets. This brought about a positive change in their sales and
market condition.
When Gillette started out in 1901, it was an organization selling shaving products and operated in USA.
In United States, the people generally showed an individual entity. They made their decisions their self.
The people of New York thrived towards making themselves look better and sharper. Gillette appealed to
their desire and brought out their product as safety razors. These razors later got upgraded to improved
and refined razors like Gillette Mach 3. Thus Gillette grabbed 90% of the market of USA.
But when Gillette went to market in India, they experienced a different kind of trait in the people. Gillette
was not able to influence the habit of shaving into the people of that nation. It needed to instigate shaving
in their day to day activities. So, Gillette took on a different approach. It started to convey their message
through celebrities. This influenced large number of people at once and since collectivism has been seen
in the people of India, they were influenced not as individuals but as larger groups of people.
That is how Gillette ran successful international business in two separate places with people of different
traits.

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4 Findings
Differences in strength of pressures for cost reductions versus those for local responsive ness
affect a firms choice of strategy. There are specific strategies to firms when they operate
internationally. The strategies are basically 4 types:
1.
2.
3.
4.

Global standardization strategy


Localization strategy
Transnational strategy
International strategy

1. Global standardization strategy- Firms peruse global standardization strategy focus on


increasing profitability and profit growth by reaping the cost reductions that come from
economies of scale, learning effects and location economies, that is their strategy to
pursue a global scale. The production, marketing and R&D activities of the firms
perusing a global standardization strategy is concentrated on a few favorable locations.
2. Localization strategy- a localization strategy focuses on increasing the profitability by
customizing the firms goods or services so that they provide a good match to tastes and
preferences in different national markets.

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3. Transnational strategy-A company following the transnational strategy are trying to


simultaneously achieve low costs through location economies, economies of scale and
learning effects, differentiating their products into different geographical markets to
satisfy the needs.
4. International strategy-The firms adopting the international strategy takes the product first
produced in the domestic market and later takes them internationally, making only
minimum alterations in the products. The distinguishing features of these kinds of
product is that they are satisfying some global needs around the world and requires very
little customization.

From the analysis of the activities Gillette does as part of its international business, it appears
that Gillette adopts the transnational strategy of the International business strategy. Gillette
simultaneously tries to achieve low cost through location economies, economies of scale and
learning effects. Apart from that they also try to differentiate their product across the geographic
markets to account for local differences; and foster a multidirectional flow of skills between
different subsidiaries the firms global network of operations. Here are some complications
between these different targets.
Differentiating the product to respond to the local demands in different geographic markets raises
cost which runs counter to the goal of reducing costs. Gillette finds such a sweet spot to cover
both low cost products and proper diversification of product to satiate the needs of the local
inhabitants.

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5 Conclusion
Gillette is a global conglomerate which has done miracles in the shaving appliances industry.
Apart from that it also spread out its reach in other businesses worldwide. In the phase of running
the international business Gillette has been successful in establishing a global stature of itself
amongst its competitors. If Gillette continues with its performance it can achieve success in the
long run.

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6. References

Gillette, K.C., The Gillette Blade February 1918, volume 1


Gillette Venus: ProSkin MoistureRich Razor", gillettevenus.com
Gillette website, gillette.com
Clark, Chapin, "Gillette Is Set to Make Noise with Mach 3," Supermarket News
Bulkeley, William M., "Duracell Pact Gives Gillette an Added Source of Power," Wall

Street Journal,
Adams, Russell B. Jr., King C. Gillette: The Man and His Wonderful Shaving Device,

Boston: Little, Brown, 1978


Ricardo-Campbell, Rita, Resisting Hostile Takeovers: The Case of Gillette, Westport,

Conn.: Praeger, 1997.


"Razor Burn at Gillette," Business Week, June 18, 2001,

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