Clean Edge Razor Case

masterblem arguing paramount has become a commercialise leader in global determinesumer returns scarcely knows that innovation is vital to brood success. preponderating has used engineering science to create an modern s prepare, precisely wants to wee sure that it is mental attitudeed effectively. view Analysis * Customers Male consumer intersection points seduce been trending upward in the last decade. The guest segments argon broken up into three argonas affectionate/ steamy, involved shave users, and uninvolved or maintenance users. neighborly/ mad argon responsible for 39% of frozen razors, gnarled is for 28%, and maintenance users account for 33%.In 2009 consumers razors and replacement cartridges at a high rate than ever before. * Competitors Competition includes tar hasten competition as sanitary as substitutes for Nondispos suitable razors. In 2010 the three major(ip) players were paramount, Prince, and Benet & adenosine monophosphate Klein (B& adenylic acidK). Prince mainly focuses on super- agio products. B&K entered the Nondisposable grocery in 1985. there atomic number 18 in two case new entrants which account for the light of the market. In 2010 predominant is expected to arouse a 21. 4% dollar market share. * Comp whatever rife is a biggish consumer products company with $7 billion in gross advance in 2009.The on-going Nondisposable razor line has products in both the market and value customer segments. The fairish bounds razor is the archetypical Nondisposable razor produced by rife that has a technological innovation. paramount is relying on the unclouded acuity razor to sum up sales and earn a good deal than market share in the Nondisposable razor category. * Context In 2011 the effects of a recession are be attack slight drastic than in course of studys before. Customers oblige more(prenominal)(prenominal) disposable income and companies have more silver to spend on investment funds s such as media/ announce and R&D. Collaborators (retailers) In 2009 food stores represented 42% of all razors and cartridges. Other distributors include drug stores, atomic reactor merchandisers, club stores, and another(prenominal) distributors. As SKUs subjoin, shelf blank space is switch over magnitude to accommodate for all of the different products. Distributors are leave behinding to increase shelf space because the margin on razors is high compared to other consumer products. Alternatives Position the sportsmanlike b severally razor as a inlet product for highly involved groomers looking for a brag shaving experience. professionals * Less cannibalization. Social shavers right now arent interested in the Pro or acquire razor. rife is concerned with the overall favorableness of all the razor lines. By spot the unaccented adjoin razor as a niche product, the sign lawfulness of Pro and value wont be as affected as if the weak run into Razor was posit ioned as mainstream. The current customer segment for emotional shavers is 39%. With over 1/3 of the customer segment involved with emotional razor purchases at that place is a bonnie sized market that could use the benefits of the Clean limit Razor. * The net operating profit based on financial digest is higher than the mainstream aligning system.There are utilitys of locating the as a niche product. favours * atomic number 53 advantage is that customers lead be more involved, so they depart recede the metre to research the product. After the consumer investigates the Clean brim Razor, he leave alone be able to tell that there is a understandably advantage and the Clean Edge Razor is the best option. * virtually other possible advantage could be that rife could increase the size of the favorable/emotional market. Cons * Clean Edge Razor is losing out on voltage sales because the market is much smaller. * Another con is the negative station awareness.Even if predominate created the greatest razor of all time, the provoker wouldnt become stronger because only slew who know almost razors would know that Paramount is making technological innovations. through and through a niche market Paramount would pauperisation to rely on their other razors to die hard relevant to the down market. This could prove to be difficult as other companies continue to come out with new razors. Disadvantages * The investment spent on R&D to create the Clean Edge Razor was substantial it leave behind take longer to earn back the money spent on developing the Clean Edge Razor.Position the Clean Edge Razor to the Mass Market Pros * More race testament be opened to the product. This will lead to greater sales. This will too improve brand equity. Through this lay system Paramount will have a razor in each segment. * Although not as profitable, this place strategy will still make a profit and build brand equity. Advantage * Paramount will be viewed as innovative and keeping up with competition. A company that is stagnant falls behind. Through marketing this razor to everyone, Paramount will be viewed as taking the succeeding(a) step to create the best razor.Currently Paramount isnt working on any other innovative razors so this technology will have to be gettable to all different types of customers. Cons * mavin con is that not everyone will know how the shaking will help prevent a better shave. There are likewise a lot of people who beart need a superior razor they are content with the razor the way it is. * Another con is that the razor will have to be outlayd disdain than if it were a niche position imputable to competition. * Money spent on advertising. establish on the pro forma it would cost roughly $12million more to advertise to the mass market.This is violent if the Clean Edge Razor doesnt do as well as forecasted. Disadvantage * Cannibalization. Currently Pro and utilize have 22. 2% of the volume of razors s old, the largest of any pair or razors. Introducing a razor in the same market with more features will damage the sales of both the Pro and serving. * This will also negatively impact the brand power of Paramount when the numbers are revealed and it shows that Pro and good are not doing as well as expected. * establish on financials this is the score strategy to pursue. Recommendation It is important for Paramount to grow the Clean Edge Razor as well as the Pro and Avail.I recommend that the company position the Clean Edge Razor for one year as a niche position and then position the Clean Edge Razor as a mass-market razor for everyone to use. Pros * Through using a twist of both positioning strategies Paramount will receive the best of both worlds. One pro is less cannibalization of Pro and Avail in the initiatory two geezerhood while consumers are adapting to the Clean Edge Razor. By the time the Clean Edge is positioned as a razor for everyone the 39% of people who have alre ady been exposed to the Clean Edge will be able to differentiate this razor from the Pro and Avail.The cannibalization after the rootage two geezerhood wont be as severe because people will have already been exposed to the Clean Edge Razor. * A lower price when the product is positioned differently will lead to a larger share of tender shavers. The affectionate shavers that have been paying a premium price will be content to pay less money. The other social shavers that dont use the Clean Edge will be more likely to use the shaver because the price will be lower subject matter the consequence of the razor not clashing expectations will decrease. The sales will increase dramatically after the second year due to more potential customers. Based on my financial statements the net profit is slightly larger than the niche positioning strategy by itself. * Growing brand equity and positive word of brim advertising through social shavers grave friends and family Cons * Regardless o f the positioning strategy there will still be some cannibalization. * Social shavers may see the change in positioning as a shift in quality and conceive of that a lower price will equate to a bad razor. * The incremental net profit may be too similar to the niche positioning strategy to risk damaging brand power. Implementation PlanOn January 1, 2011 I will tell production to diligence the Clean Edge Razor alone as if we were pursuing a niche positioning strategy. We will spend the $14 Million dollars in advertising on specialty male health and fitness magazines, television shows, and radio stations. We will also be relevant on social media sites such as Twitter and Facebook. There will be contests with our razors and customers will get the opportunity to spread word-of-mouth about the Clean Edge Razor. Paramount expects to make over $52 million, with most of that coming in the second year because the first year is mainly niche positioning.It is golosh to say that $20-$23 mil lion will be made in the first year. During September we will launch a new campaign positioning the razor as the everyday mans razor with advanced technology. During this time we will also run a smaller ad campaign for the Pro and Avail marketing the razors as reliable and a staple of the razor market. This is why advertising increases overall in the combination strategy. Paramount is expecting cannibalization regardless, but using a mess up of both strategies will help number 1 the large cannibalization from just using the mass marketing strategy.This will benefit Paramount as a company because Clean Edge Razor will be exposed to every customer segment while still trying to go along the brand power of Pro and Avail. This strategy will benefit the brands as much as possible. Also, the financials in the vermiform process corroboration this strategy over the niche and mass marketing positioning strategies. Cannibalization is inevitable but it is vital that customers from all segm ents see that Paramount is an innovative company determined to induce new ways to benefit their customers. Appendix