STRATEGY & MARKETING MANAGEMENT

GILLETTE IS THE GLOBAL LEADER IN MALE TOILETRIES PRODUCTS

Course Tutors : Professor Patrick McNamee Doctor Kate Stewart

PRESENTATION SUMMARY
EDEL TONER COLIN SYKES SARAH SHAW - INTRODUCTION - ORGANISATION AND PRODUCTS

ORLA OKUNAIYA - STRATEGY - FINANCIAL PERFORMANCE

JIM McCALLUM
NILE SMITH

- INDUSTRY AND MARKETS

- STRATEGY AND COMPETITORS

PADDY McKIBBIN - CONCLUSIONS

THE GILLETTE COMPANY

100 YEARS 1901-2001
1901 Founded by King C Gillette with William Nickerson in Boston. 1902 1st Product Double edged, T shape disposable razors. 1905 Develops new markets by opening London Offices. 1914 Gillette brokers deal with US Army (3.5 Million razors, 36 Million blades) 1950 Spends $6 Million for TV rights to Baseball World series for 6 years. 1964 Gillette splits into 2 SBUs, for grooming, the other for all other products. 1973 Net Sales exceed $1Billion.

1980 Net Sales exceed $2 Billion.

2001 Gillette has 61 Facilities in 25 Countries, and employs 40,000 people

GILLETTE WORLDWIDE MANUFACTURING SUBSIDIARIES

UK

NORTH AMERICA

EUROPE

ASIA

SOUTH AMERICA AFRICA AUSTRALIA

ORGANISATIONAL CHART
Gillette Company

Global Business Management

Commercial Operations

Grooming
(Blades & Razors)

Western Hemisphere

Eastern Hemisphere

Portable Power
(Duracell)

North America

Western Europe

Braun
(Electrical Appliances)

Latin America

Africa Middle East Eastern Europe

Oral Care
(Oral B Brand)

Asia Pacific

GILLETTE PRODUCT RANGE

PRODUCT MARKET PORTFOLIO

Toiletries
MARKET GROWTH (%)

Blades & Razors

Braun

Oral-B Duracell
1.0 RMS

GLOBAL STRATEGY
Corporate Objective
global focus on consumer products global competitive advantage in quality, value added personal care/use products

Global Market
competing in the triad markets (Europe, Japan, North and South America) industry concentration (SWOT Analysis) global market leadership in male and female grooming products

THE GILLETTE STRATEGY

Global resources organised and deployed to achieve market leadership in all their products to maintain and increase existing market share in male and female grooming products Corporate Strategy aggressive research and advertising strategic diversification e g mergers & acquisitions new product developments (invest in technology and product innovation) focus on core competencies maximise e-commerce opportunities build strong product portfolio

MERGER & ACQUISITION STRATEGY

Diversification - make or buy decisions
Stainless steel blade controversy and the multi-product market strategy

String of multiple acquisitions - some successful and some unsuccessful

Moderation of Diversification due to failed acquisitions

COMPANY SWOT ANALYSIS

Strengths
Market Leader Strong Brand Image Global Presence Aggressive Advertising Quality & Innovation Portfolio Range (Mach 3 etc) Demographic Changes Changing Societal Attitudes Consumer Brand Preference Demand for High Quality Use of JIT and ICT (e-com) New Production Technology Increased Grooming Sophistication

Weaknesses
Long Development Cycles Relatively Static Market Growth Heavy Dependence on High Street Retail Outlets Expensive Brand Maintenance

New Competitors Cloning of Successful brands Increasing Buyer Power (Inventory De-stocking) Growth in Substitutes Own Label Fits Economic Downturn

Opportunities

Threats

BLADES & RAZORS SEGMENT

Grooming Male & Female

Shaving Products

Toiletries

Blades & Razors

Electric Shavers

Pre-Shave

Post-Shave

Deodorants

Disposable Razors

Shaving Systems

Replacement Blades

WET SHAVING PRODUCTS

Mach3
Sensor & SensorExcel Atra Trac II Custom Plus Good News

SensorExcel for Women Sensor for Women

Agility
Gillette for Women Venus

COMPETITOR SHAVING PRODUCTS

BiC Products
Sensitive Twin Select Sensitive Skin Twin Lady Shaver Twin Select Silky Touch Softwin Softwin for Women Extra II FX Diamond Lady Protector+ Protector 3D Diamond Xtreme 3

Wilkinson Sword Products

RAZOR WARS
v

The Defender Product Development Consumer Research Elevate the Psychology of Shaving Captive Systems mean High Margins Women Shavers are Growth Area

Razors are a Commodity Shaving is a Chore Price Positioning Innovation Short Product Life Cycles Disposables

MACH3 TURBO
As the undisputed leader in mens grooming, Gillette is committed to innovation and to developing products which will provide men with a superior shaving performance. MACH3Turbo and the new Gillette Series fulfil that promise
Peter K. Hoffman, President,Gillette Grooming Products 30 October 2001

CONCLUSIONS
Diversifying capital, investment, products and other resources to maintain and expand position as market leader. Strategically positioned as leader, and regularly reorganising its structures to respond quickly to changes in business and competitive trends. Developing and maintaining a high profile for its brand names through marketing. Continuing to maximise efficiency in production and distribution, rather than focusing on direct retailing. Likely to remain as the market leader of Grooming sector products for the foreseeable future.

STRATEGY & MARKETING MANAGEMENT

GILLETTE STILL THE GLOBAL LEADER IN MALE TOILETRIES PRODUCTS