Bic Versus Gillette: The Disposable Wars
ABOUT HALF OF ALL WESTERN men get up each morning, confront their stubble in the bathroom mirror and reach for a cheap disposable plastic razor. Schiek, Bic, Gillette, Wilkinson or whatever, most men think that one brand does as well as the next. Also, the razor makers seem always to have them on sale, so you can scoop up a dozen of them for next to nothing. The Gillette Company does not like this sort of thinking. Of course, women also use Gillette's razors, but Gillette worries about the growing number of men who use disposables. The company makes about three times more money per unit on cartridge refills for its Atra and Trac II razor systems than it does on its disposables. However, since the first disposables appeared in 1975, their sales have grown faster than those of system razors. By 1988 disposables accounted for 40 per cent of shaving product money sales and more than 50 per cent of unit sales. Gillette: The Defender Gillette dominates the world wet-shave industry with a 61 per cent share. Schiek is second with a 16.2 per cent share, Bic has 9.3 per cent and others, including Wilkinson, account for most of the rest of the market. In 1988 Gillette's blades and razors produced 32 per cent of its $3.5 billion sales and 61 per cent of its $268 million net income. Gillette earned its dominant position in the market through large investments in research and development and through careful consumer research. Every day, about 10,000 men carefully record the results of their shaves for Gillette. Five hundred of these men shave in special in-plant cubicles under carefully controlled and monitored conditions, including observation through two-way mirrors and video cameras. Shavers record the precise number of nicks and cuts. In certain cases, researchers even collect sheared whiskers to weigh and measure. As a result, Gillette scientists know that an average man's beard grows 0.04 cm a day (14 cm per year) and contains 15.500 hairs. During an average lifetime, a man will spend 140 days scraping 8.4 meters of whiskers from his face. Gillette even uses electron microscopes to study blade surfaces and miniature cameras to analyze the actual shaving process. Armed with its knowledge of shavers and shaving, Gillette prides itself in staying ahead of the competition. As soon as competitors adjust to one shaving system, Gillette introduces another advance. In 1971 Gillette introduced the Trac II, the first razor system featuring two parallel blades mounted in a cartridge. In 1977, following $8 million in R & D expenditure, the company introduced Atra, a twin-blade cartridge that swivels during shaving to follow the face's contours. In 1985 Gillette launched the Atra Plus, which added a lubricating strip to the Atra cartridge to make shaving even smoother. Although the company's founder, King Gillette, considered developing a disposable product early in the company's life, Gillette's marketing strategy has focused on developing products that use refill blades on a permanent handle. Gillette works to give its blades, and especially its handles, an aura of class and superior performance. By promoting new captive systems, in which blade cartridges fit only a certain razor handle. Gillette raises price and profit margins with each new technological leap. Atra cartridges do not fit the Trac II handle, so men had to buy a new handle to allow them to use the Atra blades when Gillette introduced that system. Gillette has never bothered with the low end of the market - cheap, private-label blades. Status-seeking men, it believes, will always buy a classy product. Most men see shaving as a serious business and their appearance as a matter of some importance. Therefore, most men will not skimp and settle for an ordinary shave when, for a little...
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