Gillette Case Analysis Key Marketing Issue/Challenge The key marketing challenge for Gillette is the company’s ever expanding product line. In the past few years, the Gillette brand has grown considerably. The company has released many new high-performance grooming products for men. The challenge in introducing a large number of new products in a short period of time is being able to properly market each one. It is difficult to release and market one new product, but if many products are released at once, especially “high-performance” products, this marketing becomes much more difficult.
In addition, with the recent downturn in the worldwide economy, companies are having an increasingly hard time convincing consumers to switch to a new product that is most likely more expensive than the current product. “High performance” means higher pricing. Consumers are looking for a good deal on their current products or are switching to cheaper products. They have to take a gamble to move to a more expensive, different product to try it out. The product may be better for them but that does not matter if they do not try to product to find that out. Solution 1: Play to the Shopper
One way for Gillette to break into the market is to work off the discount shopper. Many times, men are not the primary shopper in the household. Additionally, men often do not shop for a bargain. For this reason, the company should target women who make these purchases for men. Many of Gillette’s commercials are targeted at men. Gillette needs to implement commercials that play up the products appeal toward women buying the product for the man in their life. In addition to marketing toward these women, Gillette should also release high value coupons for coupon shoppers. Many men have a hard time couponing.
They may not see the value in it. However, with the recent downturn in the economy and the rise in popularity of couponing with shows like TLC’s “Extreme Couponing,” many women are entering the coupon market. If Gillette can get women to make budget conscious purchases to introduce the men to Gillette’s new high-performance products, the products will continue to be purchased. It is important for Gillette to consider the possibility of the couponers not returning to the product when the coupon is not available. Many couponers buy a product because it is free or nearly free, not because they want nor need that specific product.
Gillette would not be playing into a want/need scenario. Gillette should target people who already use their less expensive products through directed mailings and promotions. Another item for Gillette to consider is how high to price the value of the coupon and for how long to provide the coupon for. If the coupon is too high in value, the company will lose a large amount of money on the products that it may never recoup, especially if it cannot turn the coupon buyers into return customers who do not use a coupon. Solution 2: Ramp Down Release of the Products
Another alternative is for Gillette to pull back on the release of the high-performance products. Maybe now is not the time to release these products. As stated earlier, it is becoming increasingly difficult to get new consumers to buy a higher priced product in the current economic climate. It may not be economically possible for Gillette to do this, however. If the company has invested a large amount of money in the reformulation of the product and the development of the product, along with the manufacturing of the product, it may be more feasible for Gillette to wait out the economic downturn and deal with the potential slow sales.
In addition, it is possible that if Gillette were to discontinue the product, consumers who have already switched to the new products would be upset and would move to a competitor’s product instead of switching to the cheaper Gillette option. Best Alternative: Solution 1 Assuming that Gillette has invested a large amount of money in developed and implementing the new products, the best alternative would be solution 1. This solution allows for keeping the product on the shelves and increases the number of coupons available. It keeps the money the company has invested in R&D in use and allows for future growth of the product.
Proctor and Gamble, Gillette’s parent company, seeks to “provide products and services of superior quality and value that improve the lives of the world’s consumers” (Purpose, Values and Principles, n. d. ). Providing these products at a great value with coupons is in alignment with this purpose. During the economic downturn, providing a better value with its products not only improves the lives of the consumers but also introduces the products to a larger segment of the market. Plan for Implementation Gillette must first determine what value to place the coupons at and how to release the coupons.
The best value to place on the coupons is at the highest point at which the company can still make money on the product. The coupons should be released online through Gillette’s website. Other options exist for the release of coupons but it would be best to drive people to Gillette’s website and have the opportunity to present additional information to the consumer or have the consumer sign up for a newsletter. Gillette would be able to use a “brick” coupon printing software, allowing it control of the number of coupons printed per person and the total number of coupons printed.
Additionally, P&G already publishes a coupon insert in newspapers about every quarter. Gillette’s coupons could be published in these also. P&G regularly places a restriction of 4 like coupons per shopping trip. This restriction keeps consumers from using a large number of coupons at the same time and clearing the shelves, causing other people to miss the opportunity to buy the product. The coupon redemption rate should be closely monitored along with sale figures for the timeframe of when coupons are available and when they are not available. The coupons should be released every other quarter so that these numbers can be easily tracked.
If during the timeframe of the valid coupons sales jump and then dive after the coupons expire, the company should reevaluate the process and determine if another solution is better. The coupon cycle should be run a few times in order to fully develop in the market. Otherwise, consumers may not have had the opportunity to experience the product, especially if the consumer has a large stockpile of men’s beauty products. References Purpose, values and principles. (n. d. ). Retrieved from P&G website: http://www. pg. com/? en_US/? company/? purpose_people/? pvp. shtml