Strategic Marketing Plan and Analysis: Gillette in Indonesia

This report provides a detailed analysis of Gillette's marketing strategy and plan within the Indonesian market. It begins with an executive summary highlighting Gillette's position as a market leader in blades and razors, and its efforts to expand its business in Indonesia, a country with a large and evolving economy. The report examines the external environment, including Indonesia's economic growth, increasing disposable incomes, and the influence of Western grooming trends. It also reviews the competitive landscape, distribution channels, and end-user customers, including segmentation, targeting, and positioning strategies. The marketing mix is discussed, along with the implementation plan for pricing and promotional strategies. The report identifies both opportunities, such as economic growth and increasing demand for grooming products, and threats, including competition from lower-priced products and the perception of grooming products as luxury items. The report concludes by summarizing critical success factors and providing insights into Gillette's approach to customer value creation and market expansion in Indonesia.

Running head: MARKETING STRATEGY AND PLAN
Marketing Strategy and Plan
Student’s name:
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Author’s note:

1MARKETING STRATEGY AND PLAN
Executive Summary
This study highlights the strategic management of Gillette in Indonesia and its marketing
strategy in this country in order to expand the business. Gillette is the world leader of blades and
razors; they also produce nine other consumer products. Indonesia has a large population and its
economic condition is being changed through the recent years. In major metropolitan cities,
maximum sales of the products are done. Gillette is categorised as a luxury product in Indonesia
as it sells body grooming products. In this study, external environment of Indonesia and its
market are explained. Annual GDP of Indonesia and its large population provide help to Gillette
to expand its market in Indonesia. The population of Indonesia follow western culture to groom
themselves. This tendency can help Gillette to increase in market share. In addition, Gillette
always follows the technological innovation in operation and they also increase products line to
be competitive in the market. The expected growth of people's disposable income in Indonesia is
almost 16% and capitalise on income growth to increase sales to provide opportunity in the
market. Gillette has introduced 24 different distribution channels to grow in the market and to
reach large customers in the market. Gillette provides the products in premium pricing, on the
other hand, competitors provide the products at less price. External situations and internal
capabilities of Gillette have been explained. Moreover, segmentation, target market and
positioning strategies of Gillette have been discussed. Marketing mix of Gillette has been given
to grab the large market share in Indonesia. Implementation plan for the pricing and promotional
strategies have been discussed.

2MARKETING STRATEGY AND PLAN
External environment – Near environment
Market review
Gillette entered Indonesia market in the year 1971 and in the year 1995; Indonesia had a
population of 196 million. Personal grooming products of Gillette did not have demand at the
early stage of marketing in Indonesia. In recent time, GDP growth is high and manufacturing
sector has been observed a growth of 12% (Hill 2016). Economic progress in Indonesia is
evident as per-capital income is increasing; this reflects an increasing disposable income of the
people. The government of Indonesia focuses on export-oriented industrialisation in order to
create growth in the market. The market for Gillette products is high right now as the personal
grooming products are now using by Indonesian people. Personal grooming products are
regarded as luxury products, however, western mentality reflects in Indonesian market to
purchase the products.
Implications
Opportunities Rating Threats Rating
Market growth of
12%
5 Export oriented
industrialisation
4
Economic progress in
Indonesia
4 Personal grooming
products do not have
market in Indonesia
3
Western mentally of
Indonesian
3 Gillette has markets in
metropolitan cities
4

3MARKETING STRATEGY AND PLAN
Competitive review
Gillette is famous for high-quality products and Indonesian can relate to the products as
in Bahasa language, ‘blade’ sounds Gillette. Gillette held the market share of 40% in the blade
market and it is expected to rise in the near future. Gillette is trying to expand the market by
giving the customers to choose from wide ranges of product lines. Gillette offers three types of
double-edge blades, disposable blades, the GII blades, the contour system blades and sensor
blades.
Gillette has been facing the competition from low-end blades from China and Eastern
Europe. Competing brands in Indonesia in most of the major cities are Tiger, Tetra and Super
Nacet. In Indonesia, Gillette's products' price is fourth time higher than the competition's prices.
Rising income and developed Gillette's distribution may help the consumers to avail the Gillett.
In addition, Gillett's disposable blades have two competitors, Bic and Bagus. Bic is from USA
and Bagus is a local manufacturing company (McKibben 1998). These products are not sold in
high volumes and disposable blades are sold in minimal.
Implication
Opportunities Rating Threats Rating
Gillette's distribution 4 Presence of Bic and
Bagus
4
Expand the market 3 Higher than the
competition's prices
3
Competing brands in
Indonesia in most of
3 Expensive brand 5

4MARKETING STRATEGY AND PLAN
the major cities are
Tiger, Tetra and Super
Nacet.
maintenance
Distribution channels and buyers
Indonesian regulations stop a foreign company to do distribute and import the products.
Therefore, the retail prices of the products cover majorly in distribution services. Gillette used a
single national distributor; however, this strategy did not work correctly. Single distributor
channel could not manage the distribution in such a large country effectively. Gillette has been
facing the issue of weak communication from the supply of the products, lack of supply channel
technology and poor traffic conditions. In order to supply of the products, Gillette has appointed
23 distributors across the country and the sale increased by 60% (McKibben 1998). Gillette has a
good distributor who has capital credit line to make the stock sufficient in order to bridge the gap
between receiving payment from the customers and paying to Gillette. Gillette has two different
set of the distribution channel for product lines and manufacturing as they believe that it will
give an extra push to business. Gillette expanded the internal sales and relation in a trade to make
more new distributors.
Implications:
Opportunities Rating Threats Rating

5MARKETING STRATEGY AND PLAN
Gillette has appointed
23 distributors across
the country Indonesia
5 Increasing suppliers’
power
4
Gillette expanded the
internal sale
4 Weak communication
from the supply of the
products
3
Market relation in a
trade
3 Poor traffic condition 4
End-user customers
End-user customers for the Gillette products are both males and females. Gillette
provides blades and shaving products for males and they also provide women razors. The target
customers of the organisation are above 16 years of age. Gillette did a market survey and it made
clear that more than 26% of the Indonesian shaved more than 4 times in a month. Grooming
products are sold more in Metropolitan cities, Jakarta, Java and Bali. Exposure to foreign media
makes grooming products as must have for the customers. 40% of the Indonesian men use blades
to shave and rest of them use dry or wet knives to shave. Only 4% of the men use shaving lotion
and 25% use soap and water (McKibben 1998). The current economic condition of Indonesia is
helpful for the people to invest in grooming products and population growth is soaring high in
recent time (Wilson et al. 2014). Gillette can expect maximum numbers of sell from the top five
cities where more than 35 million of people live in this place.
Implications:

6MARKETING STRATEGY AND PLAN
Opportunities Rating Threats Rating
Gillette provides
blades and shaving
products for males
and they also provide
women razors
5 Economic condition
of Indonesia
4
Increase of disposable
income
5 25% users of
Indonesia use soap
and water for shaving
3
Western mentality for
grooming
4 Purchasing power
parity
4
Supply
Gillette has an extensive network to manage the supply of the products to wholesalers.
The wholesalers supply the products to supermarket chains in all over Indonesia. In supplying
the products, good distributors must have knowledge of the market, sufficient sales person
reliable transportation equipment and warehouses (Churchill and Lacobucci 2016). Production
plant of Gillette takes power from the local grid and from backup generators. The suppliers of
raw materials and ammonia are from local places. Supermarket chain Hero has 54 outlets and
Metro has 5 outlets to sell Gillette products. Traditional wholesalers facing problem in supplying
the products as good handling and facilities related issues.
Implications:

7MARKETING STRATEGY AND PLAN
Opportunities Rating Threats Rating
Market leader 3 New competitors in
the market
5
Sufficient sales person
reliable transportation
equipment and
warehouses
5 Growth of substitute
in the market
4
Expansion of products
and distribution
channels
4 Wholesalers facing
problem
4
Critical success factors
Summary of opportunities
Economic growth of Indonesia is accelerating; mostly Java and Bali's regions see faster
growth. The average standard of living in this country is improving. Gillette has observed 60%
of sales in metropolitan cities of Indonesia (McKibben, 1998). Many foreign companies are
coming to Indonesia to doing business in major urban sections. Therefore, economic
improvement of Indonesia is fostering the business prosperity for Gillette.
Gillette entered the market of Indonesia with double-edge blade and more than 34% of
males in Indonesia do shaving 5 to 9 times in a month (Lewis 2017). Therefore, it is clear that
shaving kits and personal grooming products have an opportunity in Indonesia as increasing
awareness of Western grooming practices, mainly in urban areas (Andreasen 2015).

8MARKETING STRATEGY AND PLAN
The expected growth of people's disposable income in Indonesia is almost 16% and
capitalise on income growth to increase sales. In Indonesia, there is increased demand for higher-
end and higher-margin products. Gillette is now offering competitive product lines in the
Indonesian market, not just the blades and shaving kits. In addition, they improved the process of
operation to produce 3 million blades in just 3 days.
Figure 1: Summary of Opportunities
(Source: Self-developed)
Summary of threats
Grooming products in Indonesia are still considered as luxury products and Asian beards
do not grow faster as like Latino (Gronroos 2017). Therefore, Gillette needs trendsetting

9MARKETING STRATEGY AND PLAN
marketing to improve the business. There are many low prices products on shaving exist in
Indonesia market and they steal the market share from Gillette.
Gillette has been facing the issue of customs clearances from razor imports and it may
impact on entire production cycle. Gillette has to recruit regional managers from different
countries due to a shortage of talent management in Indonesia. These managers have lack of
knowledge in Indonesian market to promote the products effectively.
Figure 2: Summary of threats
(Source: Self-developed)
Segmentation, targeting and positioning strategies
Segmentation
Market segmentation is the process of dividing the customers into a group according to
their similarities (Andreasen et al. 2013). Gillette in Indonesia can segment the market into the

10MARKETING STRATEGY AND PLAN
demographic segment. In the demographic segment, the customers can be divided into age,
gender, occupation and socio-economic group. In addition, Gillette can also segregate the market
into behavioural segmentation where Gillette needs to differentiate the market according to
customers’ rate of usage, benefits sought, loyalty status and readiness to purchase. Moreover,
Psychographic segmentation can be made through customers’ preferences, personality, attitudes
and class.
Targeting
Among the three segments that have been identified in the previous section,
psychographic and demographic sections can be target market.
Primary target: Primary target market of Gillette will be upper-class people who live in
metropolitan cities. Upper socio-economic class falls into the demographic segment and they
have a better income than other. Gillette keeps the price of the products higher than the
competitors and upper middle-class people can afford their products for personal grooming.
Secondary target: Gillette can target the psychographic customer segment who likes to
purchase products according to their personality and class. People watch television and other
media; there they might watch the western grooming. Gillette can consider customers’
preferences for personal grooming in order to sell their products.
Positioning
Gillette is an established company and they are the market leader in most of the countries.
Gillette already has a brand presence in Indonesia. Gillette can take positioning statement of
heavy investment in marketing and Gillette can also take the innovation strategy in product

11MARKETING STRATEGY AND PLAN
lining (Van Waterschoot and Van Den Bulte 2014). In Indonesia, Gillette can take the
‘cannibalisation' as positioning strategy where Gillette can reduce sales volume, market share
and sales revenue in order to introduce a new product by them.
Customer value creation mix
Gillette in Indonesia is trying to increase the sale and the population of Indonesia is a
plus point for Gillette. In other Asia-Pacific countries, Gillette is trying to increase the market
volume at least 25%. Customer value is the sum of product, access, experience and cost of the
product (Smith 2016). Gillette provides high-quality blades and other shaving products to
Indonesian customers. The product performance and features are high quality. In addition,
technical innovation of the products is high as Gillette always believes in the best products in the
market. Gillette is focusing on the distribution of the products so that the products must reach to
the customers in rural and urban sections of Indonesia. Gillette products reach mainly in five
major metropolitan cities. Availability of the products and reliability on supply can make access
easily to the products. Distribution channel of Gillett is strong as they make 23 distribution
channels to meet the requirement of the market. Experience of the customers is very important to
create value for the customers and Gillette provides the best services and its brand presence is
high than the competitors. Impact of the customer is getting high as the customers are getting
influenced by Western habit. Lastly, cost of the products should be less so that large numbers of
customers can access the products (Wedel and Kamkura 2013). Gillett keeps the price of the
products high as they try to keep the products as premium pricing and process cost of the
products are the high and total cost of ownership is also high.
Strategy implementation and 4Ps of marketing

12MARKETING STRATEGY AND PLAN
Gillette needs to attract the customers who belong to upper middle-class people and have
an intuition for better living and status.
Marketing Mix Strategy Tactics
Product Gillette offers blades, double
edge blades, disposable blades
and foam.
They need to innovate the
products in order to survive in
the market. They can innovate
the concept of shaving through
GII, contour and sensor
system (Lewis 2017).
Price Gillette takes premium pricing
as their price of the products
are much higher than the
competitors. They can lower
their pricing in order to
increase the customer base and
market share.
Gillette can produce a large
number of blades at a time to
reduce the price of the
products.
Place Gillette's products are
available in supermarkets and
in small stores of Indonesia.
They take multiple
distribution strategies in order
to reach the customers in rural
sections.
Gillette’s distribution strategy
will help the brand to reach
further customers and they
take the strategy of
segregating manufacturing
suppliers from distribution
suppliers.

13MARKETING STRATEGY AND PLAN
Promotion Media advertisements are
done for the male customers
and they mainly advertise on
television. They also promote
their products in Indonesia
through newspapers and out-
of-home advertising.
The strategy of Gillette has
been taken to persuade the
customers to use their
products for the first time.
They offer a gift on purchase
promotions in order to allure
the customers to purchase
their products.
Table 1: Implementation of Marketing Mix
(Source: Self-developed)
Resource allocation
Resource allocation can be described as a strategy and process involving an organisation
to decide about scarce resources (Crask and Laskey 2016).
Strategic planning:
In Gillette, resource allocation starts with strategic planning keeping in mind about goals
and vision. Gillette takes into consideration about strategic goals in order to accomplish their
objectives through the allocation of resources.
Budgeting:
Gillette allocates sufficient resources in order to accomplish their objectives. In
Indonesia, they target to increase the market share, for which they have to increase the marketing

14MARKETING STRATEGY AND PLAN
cost. Project budgeting is an important aspect for Gillette so that can allocate the money as per
their choice.
Logistical management:
Logistics management for Gillette is very important as they have 23 different supply and
distribution channel. Logistics help the company to manage the flow of resources inside the
company (Craig and Douglas 2015).
Implementation plan
Gillette needs to consider the vision and its Indonesian vision is to increase the market
share and customer base in rural and urban sections. Most of the customers of Gillette of
Indonesia are from metropolitan cities. The strategy of taken by Gillette is to lower the price of
the products and they need to strengthen the distribution channel for Gillette in order to reach
large numbers of the customer (Fornell and Wernerfelt 2017). Promotional strategy of Gillette is
related to the discount pricing, television, newspapers and gift items. Implementation of the
strategy is associated with the accountabilities, schedule and ownership of organisation. Gillette
can do strategy mapping to implement the strategy in order to successful their goal. Gillette can
consider PR team to advertise their content to customers that can better the relationship between
customers and organisation. Gillette needs to make a schedule for advertising and deliverables
for the project.
Strategy evaluation and control processes
Strategy evaluation process is the test of the effectiveness of the strategy and during the
strategic management process; strategists formulate the strategies in order to achieve the

15MARKETING STRATEGY AND PLAN
objectives (Andreasen 2015). In Gillette, the ultimate objective is to increase the market share
and customer base. The strategies are the promotion of the products, lowering the price and
introducing the PR team in order to make a good relationship with the customers. Gillette can
take ‘strategies encounter questions' using Board of Directors. In order to determine benchmark
performance, it is needed to essential to discover the special requirements for performing the
tasks. In addition, Gillette can consider net profit, ROI and earn per share in order to evaluate the
successfulness of strategies. In order to control the strategies, the organisation can consider GAP
analysis. In addition, management of Gillette can take premise control, strategic surveillance and
special alert control.
What is to be
measured
How it is to be
measured
Data source When it is to be
measured
New target market Through increasing
customer base
Management
database
After one year of
implementing the plan
Lowering price Profitability and net
profit
Accounts reports
and financial
reports
After one year of
implementing the plan
Television marketing ROI (Return on
investment)
Marketing report After six months of
rolling out of television
advertisements
Out-of-home marketing ROI (Return on
investment) and
market share
Marketing report
and budget
Before evaluation of
marketing report
Introducing PR team Improved customer Customer Before judging the report

16MARKETING STRATEGY AND PLAN
relationship feedback of customer feedback
Improved distribution Organisation and
supplier relationship
Supplier
feedback
Customer feedback
judgement
Table 2: Evaluation and control measurement
(Source: Self-developed)