Opportunities
The ever-growing demand for personal grooming products presents numerous opportunities for Gillette. The company commands a large market share of grooming products across the globe. It is a leader in male grooming products such as shaving blades, razors and after shaves. The company is known for its captivating slogan “Gillette, The best a man can get.” Specifically, the slogan allows the company to reach a broad audience across the globe. The female market segment, emerging global markets, and underserved market segments also present viable opportunities for Gillette. The company enjoys economies of scale that allows it produce and distribute at lower cost (McKibben, 1997).
The industry is capital intensive; therefore, it discourages other companies from competing with Gillette directly because they face the challenge of investing heavily in distribution and supply chains as well as in manufacturing machines. Gillette enjoys a substantial power as a large procurer of chemicals used in plastic extrusions for the shaving devices that it produces. Such power enables the company to negotiate from a position of strength when dealing other suppliers (McKibben, 1997).
Creativity and innovation present opportunities for Gillette in the sense that they can enable the company to achieve a competitive advantage in marketing strategy and product development. The competitiveness of Gillette’s products will enable it to maintain its position as a leader in the blade and razor industry. Furthermore, the company employs advanced technologies that give it an opportunity to make better products at a relatively cheaper cost. Consumers are interested in buying quality grooming products and will purchase the products from a company that guarantees quality (Hambleton, 1987).
Weaknesses
Gillette continues to ignore of high-end technologies such as 3-D printed shavers that may add value to the company’s revenue streams. Moreover, competition from companies, such as Schick, poses a threat to Gillette market share. If Schick undertakes substantial innovations, it may increase its market share. The wet shaving market is almost reaching its peak and Gillette is yet to develop a strategy that will give it a competitive advantage over its competitors. The company continues to face intense competition from companies such as Schick, among others. It commands about 15 to 17 percent of the market share.
Additionally, the company focuses on marketing its products to male consumers while neglecting the female segment. For example, its marketing is more pronounced in male oriented activities and male-dominated sports. The company has relatively high price points while narrowing its segment focus because it primarily targets males.
Gillette’s consumers can easily substitute the company’s products with that of its competitors. Some of the corporations that buy Gillette products in large volumes, such as Wal-Mart, enjoy substantial negotiating power that allows it to determine the price at which they buy the company’s products.
As a multinational company, Gillette continues to face the challenge of diverse legal requirements that vary from one country to another. For example, each country has its rules on customs duties and taxation. Such rules distort Gillette’s pricing policy. On the other hand, an increase in VAT from one country to the other can increase the costs of raw materials in the entire industry (Srinivasan, 2014). Pricing differentials in an industry can drive away some customers while others may source the product in the “black markets.” Besides, Gillette is vulnerable to changes in the global economic activities and performance. For example, a global recession can negatively affect consumers’ spending habits in the shaving products industry (Srinivasan, 2014).
References
Hambleton, R. (1987). The branding of America: From Levi Stauss to Chrysler, from Westinghouse to Gillette, the forgotten founders of America’s best-known brand names. New York: Prentice Hall Press.
McKibben, G. (1997). Cutting Edge: Gillette's journey to global leadership. New York: McGraw-Hill Press.
Srinivasan, R. (2014). Case Studies in Marketing: the Indian Context. Oxford: Oxford University Press.
