The Razors and Blades Myth

Thoughts and input on anything related to wet shaving or men's grooming.
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drmoss_ca
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The Razors and Blades Myth

Post by drmoss_ca »

You have to read this PDF—sorry, about 30 pages.
It seems like King Gillette wasn't either quite so evil, or so smart, as we think these days. They didn't catch onto the cheap razor/expensive blades concept until the revenue from their patented sales dried up with the expiry of the patent.
Now, discuss.

Chris
"Je n'ai pas besoin de cette hypothèse."
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Squire
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Re: The Razors and Blades Myth

Post by Squire »

Hmm, I'll read it tomorrow morning while I wait for the coffee to kick in.
Regards,
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EL Alamein
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Re: The Razors and Blades Myth

Post by EL Alamein »

I believe it. It's not hard when we consider that Gillette was at the beginning of modern economics - they were living the experiment.

Chris
harper
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Re: The Razors and Blades Myth

Post by harper »

Thanks Chris, I enjoyed this.
I found it a very perceptive business school-type analysis that is short (admittedly so in the article) on the significance of the performance of the product and the likely perception that it was the best on the market because of its price, both critical marketing factors. Perception of a product's performance is a key ingredient in the product sales mix providing the performance of the product delivers what is promised. Certainly Gillette's advertising strategy hit on factors that were important to shavers and the prices charged insured in the minds of the buyers that they were getting a superior product because to many purchasers the cost of a product equates with its quality ... whether it actually is true or not often does not matter. As well, the marketing impact of the US military sales played an important part in the early acceptance of the Gillette products by the general public.

In some ways Gillette's early strategy is not dissimilar to the strategy of Apple today even though ...perhaps because of ... patents today are much more encompassing than they were in 1904. There are many smart phones that will do virtually the same things that iPhones do and do them as well but the perception is that the iPhone is the best on the market so Apple is able to charge higher prices for its phones than its competitors. And that raises the question of whether Apple would maintain its market share if it reduced its prices. I have no idea how successful the iPhone 5c has been at its lower price than the 5C. It is interesting from a market standpoint that Apple did not bring out an iPhone 6C when it was introduced although that may be planned for the next Apple update.

Still, market dominance today does not necessarily mean market dominance tomorrow and history is full of examples of market leaders failing over time. To date, Gillette is not one of those and still maintains its nearly 80% share of the US market ... an astonishing share for any product to have year after year.
brothers
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Re: The Razors and Blades Myth

Post by brothers »

I heard a radio advertisement on one of the national sports talk networks, it was Gillette, offering a regular periodic mail order shipment of
Fusion cartridges for the guys who don't want to have to go get more blades. It must be working for the others for Gillette to decide to do it too.
Gary

SOTD 99%: soaps & creams, synthetic & badger brushes, General V2 by Colonial, Kai & Schick blades, Superior 70 aftershave splash + menthol + 444
harper
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Re: The Razors and Blades Myth

Post by harper »

Gary: if Fusion is doing this it is likely defensive marketing to keep some Fusion cartridge buyers from migrating to other cartridges. However, I doubt that Gillette will put much behind it because Gillette has better brand equity in drug stores and other outlets selling similar products than any other company of its type in North America. By selling direct Gillette would be competing with its own retailers and this would make no business sense. However, for company's like Harry's and others it makes a lot of sense to sell direct. They do not have to build a retail store market, have a sales force, distribute products in bulk, etc. so it makes good economic sense to crack a market by selling direct to consumers. Still, if you hear more I would be interested in what you learn because I haven't heard about it but then I am an odd duck ... I don't follow sports anymore except the hyped ones ...the Superbowl, the World Series, maybe the Stanley Cup and anytime my old university Stanford is on TV playing football.
brothers
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Re: The Razors and Blades Myth

Post by brothers »

Bob this afternoon while watching college football there was the ad on TV. If my memory serves, I think they said it costs (quoting) about $10 a week. Maybe they're hoping to run some competitors out of business?
Gary

SOTD 99%: soaps & creams, synthetic & badger brushes, General V2 by Colonial, Kai & Schick blades, Superior 70 aftershave splash + menthol + 444
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