Blue Ocean Strategy

1. What changes are occurring in the non-disposable razor category? Assess Paramount’s competitive position. What are the strategic life-cycle challenges for Paramount’s current products as well as Clean Edge?

Examining the consumer behavior for nondisposable razors, we can observe that consumers are focusing on the premium segment. Also, they are becoming more sophisticated and expecting new technologies to smooth the shaving process. Focusing on that, Paramount should invest in the premium products category. Even though that would create cannibalism for the “pro-products” which is already loosing market.

The case points out that Gillette’s competitors were quick to copy new products. The launch of Sensor will be a breakthrough in the market and will introduce a new product category the “cartridge laser cut razor with superior quality”. Therefore it is essential for Gillette to protect their new product by pursuing patent enforcement, as they already have. This way will Gillette retain its competitive advantage and will re-introduce and position itself as a technology leader.

The kind of competition market described previously is an example of a Red Ocean Strategy. The market is oversaturated with companies

Synopsis: Gillette has long been known for innovation in both product development and marketing strategy. In the highly competitive, but mature, razor and blade market, Gillette holds a commanding worldwide market share. The peak of its innovation occurred in 2006 with the introduction of the Fusion 5-bladed razor. Today, innovation in razors and blades is thwarted by a lack of new technology and increasing consumer reluctance to pay for the “latest and greatest” in shaving technology. Gillette must decide how to put the razor wars behind them and maintain or increase its share of the global razor market.

* Customers: Male consumer products have been trending upward in the last decade. The customer segments are broken up into three areas; social/emotional, involved razor users, and uninvolved or maintenance users. Social/emotional are responsible for 39% of Nondisposable razors, Involved is for 28%, and maintenance users account for 33%. In 2009 consumers razors and replacement cartridges at a higher rate than ever before.

The Procter & Gamble has vast differentiated products due to its innovation culture. This is not just the invention of new products and services, but the ability to systematically convert ideas into new offerings that alter the very context of the business (Charan, 2008). The product differentiation allows the P&G to charge premium price for its products and assists to capture market share from its rivals by increasing the product demand.

By all this we can conclude that Gillette was actually consumed by its ambition to earn more revenue through the wrong way. Instead of trying to generate more profits buying other businesses, the Gillette executives should have focused more on the continuous innovation to their own company, because after all it was this continuous innovation and dedication that took Gillette to the top and avoid it to have any serious competition until 1962.

Paramount Health and Beauty Company is in the process of launching a new technologically advanced nondisposable razor “Clean Edge”. With its improved design, Clean Edge provides superior performance by utilizing a vibrating technology to stimulate hair follicles and lift the hair from the skin, allowing for a more thorough shave. The company has decided to introduce it in the men’s market where it has a strong presence. The company is now focussing on positioning and naming of this new product. It also needs to decide on the promotional activities to be performed adhering to the budget constraints and also must decide on the distribution channels through which it can reach to the masses.

This is done by creating a leap in value both for the buyers as well as for the organization thereby creating a new and uncontested market space. Companies left out in the red ocean usually follow a conventional approach, running to beat competition by creating a defensible position in the current market space order.

The Gillette Company has effectively entered the razor blade market in the main parts of Indonesia. Even though there is still a lot of potential for growth, it faces stiff competition, as well

This strategy seem challenging since this strategy focus on capture new market and new demand, which it’s required extra efforts in term of innovation of products and promotion in order to make customers realize about their product. Even there are some discussions about the blue ocean strategies; however, based on my review on customers comment said that the practical guidance on how to create them is limited. Therefore, without usual analytic framework which can be used as guidelines to create blue oceans as well as effective principles to manage risk, creating blue oceans viewed as too risky for managers to pursue as strategy for their company.

Product quality and efficient marketing are the core value propositions that set the pace for Gillette’s success. With continued innovation in both product development and marketing strategies Gillette has been able to retain a commanding

Gillette has been successful in convincing the world that more is better, in regards to the number of blades and other features of a razor. To be successful in the

Because of their similarities, Proctor & Gamble and Gillette are a good strategic fit. Between the two entities they have the ability to combine operations, technology, resources, distribution channels and research costs in efforts to drastically cut spending. With lower costs, and the merger complete, the collaboration of Proctor & Gamble and Gillette should achieve a 1+1=3 effect.