What changes are occurring in the non-disposable razor category? Paramount is facing not only the traditional, on-going competition from the other long term, established companies in the market, but faces increasing challenges to its market share from new entrants as well. Traditionally, the market consisted of disposable and non-disposable razors, but within the last few years, a new trend has emerged. As a result of the increased emphasis on esthetic, or beauty products for men, there has been is a growing movement among male consumers who are gravitating toward premium shaving products. Known as the “social/ emotional” segment, it commands 39 percent of the total non-disposable users, which is a greater percentage overall than either the “aesthetic” or “maintenance shavers”. This change has created a niche market, where men are willing to pay a premium for razors with better features and/or quality. The razor industry is addressing this trend with more elaborate and higher end offerings in a bid to capture a greater portion of this emerging segment. Assess Paramount’s competitive position.
Paramount commands a 23.3 percent share of the non-disposable razor market as of 2009, outpacing bother Prince (23.1) and Benet and Klein (B & K) at 19.2 percent. In dollars, their share of the market is 23.4 percent, which is higher than B & K at 22.0 percent, but trail Prince by 7.3 percent. It is also interesting to note that Paramount has increased its market share each year since 2007, while the competitors have not increased their market penetration. An interesting observation to note is that in terms of marketing expense, B & K outspent Paramount by more than 84 percent, while Prince spent 45.6 percent more. This was due, most likely, to the introduction of new products with the requisite need for an intensive introductory marketing campaign. Despite the advertising funds expended, Paramount still has a larger percentage of the market. This indicates that Paramount is a trusted brand that produces excellent products and has excellent brand name recognition with consumers. When the Clean Edge is introduced and if it is properly marketed, this should be a sufficient boost to propel Paramount ahead of its rivals to a significant degree. What are the strategic life cycle challenges for Paramount’s current products as well as for Clean Edge? Despite the fact that the Paramount Pro and Avail series of razors have not undergone significant technology innovations in the past five years, they still led with the largest market share in 2009. The life cycle of those products are approaching, if not already arrived at the point of no longer being competitive in this market. The impending introduction of the Clean Edge will deflect a degree of the focus away from current products for a time, but they should plan to make improvements to the existing razors, as soon as it is feasible, to stay competitive in the mid and lower range segments of the market. They may wish to transfer some of the technology from the Clean Edge to the less expensive brands to differentiate them from their direct competitors. In the case of the Clean Edge, its life cycle will be as long as it can remain a superior device in the eyes of the consumer. Technological differentiation or consumer acceptance of the other competitors’ products will ultimately determine the length of the life span of the Clean Edge.
How is the non-disposable razor market segmented?
The non-disposable razor market is made up of three segments: the high end or super-premium, the moderate and the lower cost or value segments. The low or value segment of the market does not have a great degree of interest in the differences between products, whereas the moderate has more interest and is willing to try new products and technologies. The moderate, as well as the super-premium portion of the market includes men and women who are further sub-divided into groups...
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