Gillette: The Best a Razor Can Get?
The below is an extract of a research essay on the issues currently faced by Gillette from 2005 to the present day. To read the full essay with sources please contact the author using the contact page.
Gillette, a safety razor company founded in 1901 by King C. Gillette, was once valued at its peak at just over $57 billion in 2005 when it was acquired by the multinational conglomerate, Procter and Gamble. Since its sale, the brand has consistently seen a decline in brand value from being the world’s 27th most valuable brand in 2006 to 98th place in 2019. The company has also experienced numerous setbacks in the United States; an $8 billion dollar write down for the business just months after a high-profile ad campaign, declining net sales of their products for 11 out of the last 12 quarters, and direct-to-consumer startups like Harry’s and Dollar Share Club are steadily eating away at the firm’s US market share. Evidence for this decline had been documented as long ago as 2012 when margins from sales volume and competitor growth were becoming evident (see below). In an attempt to combat this, Gillette ‘slashed’ prices by 12 percent in 2016.
As the dominant brand in the US razor blade market what factors are causing consumers to select alternatives and why are sales lagging from a company that appeals to a broad global audience. Knowing the root(s) of this cause would greatly benefit the company in devising a future strategy or to implement a change in tactics.
Through a systematic analysis of user comments left online at four major websites, five broad themes have emerged to be a prime concern for Gillette consumers. Upon further reflection on these themes allows for them to be synthesised into two succinct groups, one of the perceived value of money and the other for product quality emanating from its performance and feel. While reviewers were happy with the initial quality, build, and performance, they felt the intensity of use did not match the frequency of repeat purchasing. Traditionally speaking, value for money is used to describe a pre-purchase sentiment, but in this sense, reviewers were prepared for a higher upfront cost but were expecting a longer use period. Thus, this concern is both financial and linked to expectations with a slight overlap with product performance as longevity and durability was an issue. Others, however, have commented on using an older Gillette product to have lasted longer than newer models. Again, indicating a gap between expectations and real use.
Gillette’s marketing is clearly providing favourable product impressions and product performance pre-purchase, however, post-adoption satisfaction is lacking and leads to disconfirmation. This broad level dissatisfaction is further leading to new and existing customers to seek alternatives.
Given the above, there are key improving facets that would greatly improve customer retention, and increase perceived product quality and value.
- Adapt packaging designs so that shaving foams and liquid products can be fully utilised by the consumer.
- Introduce a metric by which products can be assured to last, e.g. razor blades can last for two months of daily use before needing to be thrown away.
- Improve Gillette’s Shaving Club online shopping experience to be totally frictionless and invest in raising its visibility for an emerging customer demographic. This will supplant 3rd party retailers over time.
- Alter future marketing themes to praise brand loyalists and cultivate a positive identity associated with the brand.
The recommendations above are focussed on increasing Gillette’s functional value, as reviewers’ concepts were focussed in this area. If Gillette wishes to pursue an alternative path, then it is probable that its average product price would need to be reduced to match a new lower expected quality of Gillette branded products. Given that their products are already at the higher-end of the market ma price reduction would lead to a protracted price war that can damage brand image and market share with unpredictable results on profits.