Gillette Case Study: Competitive Strategy Analysis (BUS 492)

This case study analyzes Gillette's strategic management within the consumer goods industry, focusing on its product lines, competitive environment, and business strategies. The analysis begins by identifying Gillette's core product/industry and the needs it addresses. It then applies Porter's Five Forces framework to assess industry dynamics, including threats from new entrants, substitutes, rivalry, and the bargaining power of suppliers and buyers. The study further examines Gillette's functional-level strategies, particularly in product innovation and technological advancements within the razor and blade market. Additionally, it explores Gillette's business strategies, including marketing, product diversification, and global expansion, and how these strategies contribute to maintaining a competitive advantage. The study concludes by evaluating Gillette's success, emphasizing the role of innovation, diversification, and technology in the company's performance. References from various sources have been used to support the analysis.

Running head: STRATEGIC MANAGEMENT OT GILLETTE
STRATEGIC MANAGEMENT OT GILLETTE
Name of the Student
Name of the University
Author Note

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Answer to Question 1
The Procter & Gamble Company (P&G) is a multinational consumer goods based
corporation that has it’s headquarter in Cincinnati, Ohio. The organization was established in the
year 1837 by William Procter and James Gamble. The firm mainly specializes in providing vast
range of the hygiene based and personal care products to consumers in different parts of the
world. P&G had recorded total sales of 83.1 Billion Dollars in the year 2014 and the organization
had streamlined its operations in the same year. P&G had announced the acquisition of Gillette
in the year 2005 and this had supported the organization to become the biggest consumer goods
based firm. The acquisition of Gillette had also added different products to the vast portfolio of
the firm that include Gillette razors, Braun, Oral-B and Duracell (Gillette.com, 2020).
Gillette aims at fulfilling the grooming based needs of consumers in different parts of the
world with the help of products that are offered to them. The major preference is thereby
provided to the enhancement of the premium performance with the help of shaving experience
that offers value money. Gillette has been able to recognize that the various segments of a market
seek different product benefits and this further leads to the implementation of technologies for
the purpose of manufacturing suitable products (Gillette.com, 2020). The four major business
areas that are a part of the operations of Gillette include personal grooming, portable power, oral
care and electrical appliances. Gillette has been able to gain a unique brand position based on
shaving based needs that are fulfilled by the products.
Answer to Question 2
The Porter’s five forces framework can be implemented for the purpose of understanding
the different industrial forces that have an impact on the operations of Gillette. The performance

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levels of Gillette and the long term based survival are influenced in a huge manner by the
industry based forces.
Threats of the new entrants –
 The threats related to new entrants in the market are based on entry of new
players in the industry. However, the organizations require huge levels of capital
and investment of resources for the purpose of developing their operations in the
consumer goods based industry.
 The presence of a loyal consumer base is considered to be a major factor that is
able to lower the threats that are faced by Gillette from new entrants in the
industry.
Threats of substitutes –
 The availability of substitute products in the consumer goods industry is low in
case of the operations of Gillette.
 The threats faced by Gillette from the substitutes are also reduced due to the
presence of high quality products that are provided by the organization to its
customers (Faith & Agwu, 2018).
Rivalry among the existing firms –
 The levels of competition and rivalry that are faced by Gillette in the industry
are considered to be quite high due to the presence of large organizations.
 The formation of long term based relationships and making effective
investments in research and development are considered to be major factor
that have an impact on the organization.

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Bargaining power of the suppliers –
 The suppliers of Gillette have high bargaining power due to the presence of
various raw materials that are used for the manufacture of different products.
 The high levels of product differentiation can be achieved by Gillette based on the
quality of raw materials that are offered by the suppliers.
Bargaining power of the buyers –
 The vast product portfolio of Gillette include five blade ProGlide, Fusion razors,
3-blade Mach3, disposable razors and the All Purpose Gillette Styler for the facial
hair styling and body hair trimming. The concentrated consumer base of Gillette
is highly concentrated in nature and this has been able to enhance their bargaining
power in a huge manner (Lawrence et al., 2019).
 The huge levels of knowledge related to the market and high price sensitivity can
have a major impact on the operations of Gillette and the products that are offered
to the consumers as well.
The analysis of the consumer goods based industry with the help of Porter’s five forces
framework has been depict that the different forces do not have a huge impact on the operations
and profitability levels gained by Gillette. The new entrants in the industry and threats of
substitutes have a low impact on the profits that are gained by the organization. On the other
hand, the suppliers have a moderate impact on profits of Gillette and prices of the products as
well.
Answer to Question 3

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The major functional level strategy that has been implemented by Gillette for the purpose
of maintaining a competitive advantage in the market is mainly based on the improvements of
the razors and blades that are offered to the consumers. The improvements were mainly based on
the sales percentage of Gillette that has been gained in the industry. This segment is considered
to be a major contributor to the sales of Gillette. Around 40% of the total sales and around 70%
of the total profits of Gillette have been gained from the male and female grooming products of
the organization. The proper improvement of technological advantages have also been able to
influence the position that has been developed by Gillette in the industry. The global brands of
Gillette including Sensor Excel, Sensors and Mach 3 have been able to provide major
contribution to the improvement of functional level strategies implemented by the organization
(Olson et al., 2018).
Answer to Question 4
The business strategy of Gillette is mainly based on the grooming products like
deodorants, gels and shave foams that are offered to the male consumers in different parts of the
world. The company has thereby enhanced its focus on the implementation of marketing
strategies that can be implemented for the purpose of enhancing awareness related to these
products. The market segment of Duracell is also able to hold around 40% of the total shares that
have been gained by Gillette in the industry. The major aim of Gillette based on enhancement of
product base was related to adding an additional brand to the product portfolio.
Gillette had also been able to predict global opportunities that are provided to the
organization based on expansion of the product portfolio in order to monopolize markets of
India, Russia and China. The strategy based oral care that has been implemented by Gillette is
mainly aimed at proper improvement of the products that include Oral B Cross Action

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Toothbrush. The business strategy is also aimed at gaining advantage in the industry with the
help of proper combination of the expansion of geographic and products (Olson et al., 2018). The
marketing strategies of Gillette have been able to position former brands of Gillette including the
products of Procter and Gamble that leads to the enhancement of leadership position in the
industry. The major strategy behind the implementation of business strategies have been based
on enhancing the effectiveness of various distribution channels.
The positioning of the additional product line is able to enhance the ways by which
Gillette is able to maintain its position in the industry. The marketing strategy of Gillette has
been able to support the company so that it is able to face the competitors who are a part of the
industry. The major competitor Gillette with respect to the blade and razor based product
segment is Schick. The strategy implemented by Gillette is mainly based on enhancement of the
sensitivity of blades (Olson et al., 2018).
Answer to Question 5
Gillette is currently a part of Procter and Gamble that operates in the consumer goods
based industry. The organization aims to compete with the other major organizations that are a
part of the industry with respect to variety of products and the size of consumer base as well.
Technology implementation has been able to play a major role in improvement of products that
are offered to the consumers. Globalization on the other hand has been able to enhance the
consumer base in different parts of the world. Diversification and levels of integration also has
the ability to support strategic rational related to the successful operations of P&G in the
industry.

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Innovation and technology have been able to play a major role in supporting Gillette to
face the competition in the industry. Fusion ProGlide is a major product that is offered by the
organization in order to include innovation within the product base and attracting different types
of consumers as well. However, the older products that are a part of the portfolio of Gillette are
still able to provide major levels of contribution to the growth that has been gained by Gillette in
the industry. The success that has been gained by Gillette in the consumer goods industry is
mainly based on the different types of products that are offered and the proper implementation of
innovation in improvement of the operations. Diversification of the product portfolio is also able
to play a major role in successful operations of Gillette (Faith & Agwu, 2018).

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References
Faith, D. O., & Agwu, E. (2018). A review of the effect of pricing strategies on the purchase of
consumer goods. International Journal of Research in Management, Science &
Technology (E-ISSN: 2321-3264) Vol, 2.
Gillette.com, (2020). About Gillette | Gillette®. [online] Gillette.com. Available at:
<https://gillette.com/en-us/about> [Accessed 30 March 2020].
Lawrence, J. M., Crecelius, A. T., Scheer, L. K., & Patil, A. (2019). Multichannel Strategies for
Managing the Profitability of Business-to-Business Customers. Journal of Marketing
Research, 56(3), 479-497.
Olson, E. M., Slater, S. F., Hult, G. T. M., & Olson, K. M. (2018). The application of human
resource management policies within the marketing organization: The impact on business
and marketing strategy implementation. Industrial Marketing Management, 69, 62-73.