Case

Clean Ldge 8azor

genda genda
W8ackground of Lhe case
Wnew lnnovaLlve producL developed
WMarkeL compeLlLors analysls
WoslLlonlng dllemma 8randlng and
MarkeLlng budgeL
WlLernaLlves flnanclal analysls
Case Cvervlew Case Cvervlew
W aramounL ls a global consumer producLs glanL wlLh $13 bllllon ln
worldwlde sales
W LnLered Lhe nondlsposable razor markeL ln 1962
W aramounL currenLly offered Lwo llnes of nondlsposable razors and
reflll carLrldgesLhe aramounL ro whlch was poslLloned ln Lhe
moderaLe segmenL of Lhe producL caLegory and Lhe aramounL vall
whlch was consldered a value offerlng
W now Lhey have developed a new producL Lhe clean edge razor
W 1he cases dlscusses Lhe poslLlonlng dllemma of Lhls new producL
new lnnovaLlve producL developed new lnnovaLlve producL developed
1 newnondlsposable razor developed Clean Ldge
2 Clean Ldge's lmproved deslgn provlded superlor
performance by uLlllzlng a vlbraLlng Lechnology Lo
sLlmulaLe halr folllcles and llfL Lhe halr from Lhe skln
allowlng for a more Lhorough shave
3 ulLraLhln flveblade deslgn
4 Cne baLLery was housed ln Lhe handle of Lhe razor
whlch provlded vlbraLlons LhaL sLlmulaLed halr folllcles
3 1he larger heavler handle allowed for beLLer balance
grlp and conLrol whlle shavlng and Lhe advanced ulLra
Lhln blade deslgn reduced lrrlLaLlon
6 Cllnlcal Lrlals lndlcaLed Clean Ldge achleved a 23
lncrease ln halr removal versus oLher leadlng
nondlsposable razor brands
MarkeL compeLlLors analysls MarkeL compeLlLors analysls
uS markeL scenarlo
W nondlsposable razors experlenced approxlmaLely 3 growLh per year from 2007 Lo 2010
W 8eflll carLrldges capLurlng sllghLly less growLh of approxlmaLely 2 per year over Lhe same
Llme perlod
W CurrenLly nondlsposable razor ls dlvlded lnLo value moderaLe and superpremlum
W 1he nondlsposable razor and reflll carLrldge markeL was domlnaLed by
Lhree mulLlnaLlonal players aramounLrlnce and 8eneL kleln
W new enLranLs 8adlance PealLh lnc (8adlance) and Slmpsons
MarkeL compeLlLors analysls MarkeL compeLlLors analysls
oslLlonlng dllemma 8randlng and
MarkeLlng budgeL
oslLlonlng dllemma 8randlng and
MarkeLlng budgeL
1 oslLlonlng
a Clean Ldge should be launched as a malnsLream enLry wlLhln LhaL
segmenL
b ulfferenLlaLed nlche sLraLegy LargeLlng super premlum consumer
CannablllsaLlon lssue
W malnsLream sLraLegy wlll dlluLe Lhe brand power for our breadand
buLLer producL ro
W oslLlonlng Clean Ldge as a malnsLream producL wlll help prevenL loyal
aramounL cusLomers from belng wooed away Lo more lnnovaLlve
brands
W 60 of Clean Ldge sales would llkely come from currenL ro/vall
cusLomers ln a malnsLream poslLlonlng scenarlo
W nd 33 of Clean Ldge sales would llkely come from currenL ro/vall
cusLomers ln a nlche poslLlonlng scenarlo
2 8randlng lssue
a Lmphasls on new Lechnology and word clean edge llke Clean Ldge by
aramounL"
b 8ulld on aramounL brand equlLy llke aramounL Clean Ldge"
3 MarkeLlng budgeL
W a nlche poslLlonlng sLraLegy would requlre $13 mllllon ln LoLal markeLlng
expendlLures for Clean Ldge's flrsL year ln order Lo reach full sales
poLenLlal wlLh Lhe malnsLream poslLlon a $42 mllllon markeLlng budgeL
would be needed for year one
W romoLlon coupon for a free razor wlLh carLrldge purchase had been
proposed pprox $ 4 mllllon for promoLlon
oslLlonlng dllemma 8randlng and MarkeLlng
budgeL
oslLlonlng dllemma 8randlng and MarkeLlng
budgeL
lLernaLlves flnanclal analysls lLernaLlves flnanclal analysls
W 8rand name should glve lmporLance Lo aramounL Lo bulld on brand
equlLy 1hls wlll also help ln keeplng Lhe adverLlslng budgeL low
W ?ear 1
CarLrldge
roducLlon/unlL cosL 243 224
ManufacLurer prlce 733 622
suggesLed prlce 103 889
CapaclLy volume 4 99
roflL 1968 39402
8azor
roducLlon/unlL cosL 3 474
ManufacLurer prlce 909 783
suggesLed prlce 1299 1119
CapaclLy volume 1 33
roflL 409 10197
dverLlslng 7 19
romoLlon 6 17
Lrade promoLlon 2 6
1oLal advL cosL 13 42
neL roflL 877 7399
CannablllsaLlon 33 60
d[usLed flnal proflL 37003 30396
W ?ear 2
W Cur analysls prefers nlche poslLlonlng prlmarlly due Lo lower
cannablllsaLlon of 33 ln compared Lo 60 ln malnsLream
CarLrldge
roducLlon/unlL cosL 243 224
ManufacLurer prlce 733 622
suggesLed prlce 103 889
CapaclLy volume 10 219
roflL 492 87162
8azor
roducLlon/unlL cosL 3 474
ManufacLurer prlce 909 783
suggesLed prlce 1299 1119
CapaclLy volume 13 4
roflL 6133 1236
dverLlslng 7 17
romoLlon 6 14
Lrade promoLlon 3 8
1oLal advL cosL 16 39
neL roflL 39333 60322
CannablllsaLlon 33 60
d[usLed flnal proflL 2336773 242088