Gillette overhauled to produce 600 million Mach3

Gillette is leading worldwide home applicants, such asrazor, battery, electronic and manual toothbrush,manufacturing company. On April 14, 1998, the companyintroduced the worlds first triple blades razor and begun tosell July 1, 1998 in the United States and September in theWestern Europe. Since Gillette launched new razor in1998, the company expected high returns in short-term;however, the result of the new product has been definedyet. SWOT ANALYSIS – Key Learning The areas of theinternal factors are Finance, Management, Manufacturing,Market position, Personnel, and Research & Development.All these factors can be defined as either strengths orweakness or both.

First of all, the company as a wholegained net sales amount of 10.1 billion dollars and netincome of 1.4 billion dollars for the 1997 due to acquireleading battery company Duracel in 1996 and grow ofSensor Excel razor. As a result, company could spend 1billion dollars to invent Mach 3 which is triple bladesrazor. Even though Gillette had sufficient fund to invent thenew product, the company took high risk of financial sidethat if the new products sale does not reach to companysexpectation, the company will face shortage of capitalresources and can be lead to bankruptcy. But if Mach3turn out to be a New Coke or McDonalds Arch Deluxe much-hyped new products that were mostly duds andfizzle- the gloom will be heavy from Gillettes corporateheadquarters in Bostons Back Bay to the South Bostonfactory that Gillette has overhauled to produce 600 millionMach3 blade cartridges per year, or about half of Gillettesannual target of 1.2 billion Mach3 blades.

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(Boston Globe,4/15/98) Since Gillette introduced “Mach3″ in April, thecompany changed its manufacturing tools to produceMach3 South Boston’s factory. Gillette already spent 300million dollars for advertising and promotion worldwide forthe year that company introduced new product. Theamount is twice as much as the company put for advertising”Sensor Excel” in 1989. Gillette released the new productto retail stores on July 1, 1998, and starts to advertise onTV and the other media six weeks later; however, manypeople went to the company’s web site to look at the newproduct. Even though company spent tremendous amountof fund for the advertising, some people from Asia did notrecognize the product according to our group’s survey.

Forcustomers, there are satisfaction and complaints forMach3. People, who satisfied with Mach3 according toour survey, said there are less irritation and faster shavingtime. Customers who complaint about Mach3 argue thatthey do not want to spend more money on better outlook.According to our survey, one hundred percent ofsurveyees, who does not satisfy with Mach3, say the priceis too high for the product. Price is relatively higher thanother products including “Sensor Excel” which was themost expensive one before “Mach3” came out.

Its price is6.99 dollars per razor with one blade included – currently,the company is selling for 7.29 dollars per Mach3. It is 4percents increased from original price, and 40 percentshigher price than other products. This may lead to decreasein sales and the companys total revenue. The company istrying to reach customers several different ways.

Gilletteoffers Mach3 package product, which included Mach3itself and couple of extra razors, Shaving cream anddeodorant. This package product makes each items unitprice lower than sell separately. Also, the company offerssweepstakes on the company’s web site, and there is noobligation. This is the one of the finest ways to reach andget involve the customers.

The company give chance topeople to win prize without any obligation; however,people will recognize the product automatically. Also,Gillette can acquire the Since Gillette is well-known globalcompany, many retail stores are not offended to carry thecompany’s product even though the product’s price is high.Retail stores are assume that Mach3 will bring morecustomers. On the other hand, even more customers cometo store, it is unpredictable for increasing stores salesrevenue because price is too high so that consumers wouldnot buy. External factors are Competitive, Economic, andSocial. Gillettes major rival in the market is Shick. SinceGillette is the first company produce triple blades razor, thecompany will lead the market; however, rival companysuch as Shick will develop the same product with higherquality or lower price.

Then the result will be unforeseenunless Gillette improve Mach3s weakness – high price.For long time in the United States, peoples income hasbeen growing. As a result, customers purchasing poweralso increased. However, the companys market is not onlythe United States

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