Case Study on Gillette

Md Towhidul Islam

MKT 550; Case Study on Gillette

Prof. David B. Allan

1.

Gillette had very early on developed the belief that continuous product development was necessary to differentiate itself from the rest of the competition. Its definition of innovation was “a successful innovation was that one that is purchased over and over again by a satisfied customer”. We can divide the innovation history of Gillette into two periods - one is from early 1900s to 1962, the year Wilkinson sword introduced its stainless-steel blade, and the second one is from 1962 to recent time. During the first period of innovation, Gillette had the luxury of enjoying monopolistic market power in the razor market. So, everything they innovated from the first safety razor using the new disposable blade went on sale in 1903 to the first "adjustable" razor in 1958 was unique on its own stature. However, in 1962 being challenged by Wilkinson sword, Gillette had become distracted for a while and experimented with some venture by acquiring companies in different industries. While Sword could not exert pressure duo to its resource paucity, Gillette turned around from its fiasco of growing by riding on acquisition. Since then, it has consolidated its position by innovation products like match 3 and Gillette fusion razor, among others. The result is 70% global market share in wet shaving industry. So, it can be said that Gillette has successful story of product innovation throughout the history.

Sometimes Gillette has been the victim of its own success through product cannibalization and being disrupted by its own innovation. In 1998 they successfully introduced Mach3, the first three-blade razor. However in 2006 they released Gillette Fusion, a five-bladed razor. To promote their new product (Fusion) they effectively cannibalized their successful Mach3 series. More interestingly they put the slogan “Why Fusion is better than Mach3” on TV commercials. Beside this, as mentioned above, they...