Paramount Health and Beauty wants to launch a new razor into the market currently referred to as “Clean Edge.” The project team recommends that the company should position the product as a distinct mainstream product, dubbing it “Clean Edge by Paramount” in order to produce growth in sales from new product innovation. The importance of placing the product in a mainstream position is to successfully launch an innovative product creating more market share for Paramount and for Clean Edge to become the most sought out razor in the industry. Failing to take this route and deciding to position the product in a niche would only give the new product a limited amount of consumers, preventing Clean Edge from reaching its full potential in sales and market share. Decision Options
Paramount is faced with 2 different options in which Clean Edge could possibly be positioned: 1Place Clean Edge for a niche product position focusing on highly involved, fastidious groomers looking for a superior shaving experience. 2Place Clean Edge for a mainstream position focusing on the broad advantage of offering the closest possible shave. Additionally, Paramount is considering 2 alternative brand names for the Clean Edge Razor: 1“Clean Edge by Paramount” promotes the individual product. 2“Paramount Clean Edge” supports Paramount’s brand name equity. Decision Criteria
●Should we take the mainstream approach, the Clean Edge razor will cost less to the consumer. The suggested price in the mainstream positioning for the razor and cartridge respectively would be $11.19 and $8.89. The suggested price in the niche positioning for the razor and cartridge respectively are $12.99 and $10.50. ●Mainstream positioning targets the entire market of shaving consumers, whereas the niche strategy positioning would be targeting only intensely involved consumers which makes up 67% of the market. ●Clean Edge Razor has enhanced technology to beat out competitors in the mainstream. Clinical trials indicated Clean Edge achieved a 25% increase in hair removal versus other leading nondisposable razor brands. ●Paramount will lose potential customers to competitors if the company fails to introduce the product to the mainstream. In a 2009 study by Paramount it was concluded that the replacement cycle of nondisposable razors had been shortened due to consumers trying new products. ●Appealing to the mainstream, the distinction of the brand name, Clean Edge, must remain separate from the other line offerings. To be sure that it will be distinct it is the consensus of the executives that the Clean Edge razor will be priced at the super premium level of razors. Proof of Recommended Options
Paramount should pursue the second option in positioning Clean Edge. Along with utilizing a vibrating technology to stimulate hair follicles, Clean Edge offers other enhanced features. The features include ultra-thin five blade design to reduce irritation, and a larger handle for better grip and control while shaving. The suggested retail price for Clean Edge razors would be $11.19 compared to the niche positioning price of $12.99. Refill cartridges for the razor would be priced at $8.89 compared to $10.50. The razor’s features, along with their reasonable prices, sets Clean Edge apart from their mainstream competitors. This would not only attract new consumers to Paramount products, but also give their current customers a new, more enhanced razor that comes from the company they already rely on. During test markets of the Radiance’s Naiv razor, a 13% market share was achieved. The Naiv razor is an innovative nondisposable razor. By strategically planning for long term product positioning, Paramount has the capability to assume competitive advantage. Pro has reached the maturity phase of the product lifecycle, and Paramount will lose customer interest. Introducing Clean Edge Razor will attract new consumers and retain their loyal customer base....