G|||ette Indones|a Case Study

lnLernaLlonal MarkeLlng
Croup 1 8a[esh vlg !uhl 8a[puL Aakanksha
SalLh Sachln Sharma
compony lntroduction
n estab||shed househo|d name
Innovator |n razor techno|og|es
Wor|d |eader |n persona| hyg|ene products
D|vers|f|ed product range
Company buyouts product d|vers|f|cat|on]e||m|nat|on
G|oba| expans|on new markets
istory
rocLor Camble acqulred 1he CllleLLe Company
1996 + yrs produce mllllon blades/year
1996 lncrease producLlon 168 mllllon blades mllllon Lo exporL
199 manufacLured 1 mllllon blades 46 mllllon exporLed
197 manufacLurlng planL esLabllshed
1971 CllleLLe enLered lndonesla
191 1he CllleLLe Company founded ln 8osLon MassachuseLLs
as G|||ette Ln[oyed a I|rst Mover dvantage?
es tbtooqb effectlve motket eotty!
MarkeL enLry wlLh slgnlflcanL lnvesLmenL
LsLabllshed manufacLurlng planL for local and
exporL sales
8rand equals hlgh quallLy blades
'CllleLLe' used Lo mean blade ln lndoneslan
SlgnlflcanL markeL share
LS1LL
9o||t|ca|
lor LhepasL years loJooesla#s pollLlcal
sysLem bas been led by resldenL SuharLo
who oversees all ma[or economlc
JevelopmeoLs and changes ln JomesLlc
pollcles 1hls represenLs a pollLlcal dllemma
for CllleLLe should Lhe pollLlcal power shlfL Lo
an opposlng parLy
Lconomlc
loJooeslao CovernmenL encourages a hlgh
exporL raLe Lo ald Lhe exlsLlng hlgh
populaLlon growLh raLe Lo lncrease Lhe
oaLloo#s employmeoL prospecLs lorelgo
lovesLmeoL ln loJooesla for 1994 has rlsen
Lo$7 bllllon up from $86 mllllon 8 years
earller lo1996 loJooesla#s lul ls expecLeJ Lo
grow Lo 74@bere are approxlmaLely
mllllon people enLerlng Lhe work force every
year wlLh 8 of Lhe populaLlon obLalnlng ao
annual lncome of $1 per year
LS1LL
Soc|a|
opolaLloo 196 mllllon
opolaLloo Jemograpblcs
loJooeslaos are spread across 1
lslands wlLh llvlng ln Lowns and
6 llvlng ln rural areas 6 of
loJooeslaos llve on Lhe lslands of 8all and
!ava
1echnologlcal
ManufacLurlng lmprovemeoLs ln 199 saw
lncreases of 7 ln producLlvlLy reduclng
Lhe Llme Lo produce Lbelr blades
LS1LL
ega|
@be resldenL of loJooesla oversees all
legal reforms 8egulaLlons prohlblL forelgn
companles llke CllleLLe from lmporLlng or
dlsLrlbuLlng Lhelr producLs
LnvlronmenLal
loJooesla has eovlroomeoLal leglslaLlon as
of 1996 deallng wlLh dlsposal of wasLe
producLs resulLlng from manufacLurlng (
eg ammoolo)
CllleLLe SWC1 Analysls
W Strengths
W Increase Western groom|ng
pract|ces
W arge popu|at|on
W market share by 199S
W Lffect|ve d|str|but|on system
W oca| and export manufactur|ng
W rand h|gh qua||ty
W |s|ng |ncomes more sa|es revenue
W Lffect|ve market|ng campa|gns
Weaknesses
Inappropr|ate g|oba| advert|sements
|gh manager turnover
Cu|tura| behav|or creates manager]
d|str|butor prob|ems
ega| system |ess support|ve outs|de
Iakarta
Intense compet|t|on for supermarket
she|f space
nt|quated d|str|but|on methods
Many d|fferent |anguages spoken
CllleLLe SWC1 Analysls
pportun|t|es
W ver 7 GD9 growth |n 20
years
W Stab|e po||t|ca| system
W Lconom|c |mprovements
W Increase |n per cap|ta |ncome
W @wo m||||on peop|e to enter
workforce
W 9opu|at|on earn|ng |ncome
grow|ng
W Shav|ng |nc|dents of S10
t|mes per month + popu|at|on +
per cap|ta |ncome Increased
Sa|es
@hreats
W ower qua||ty products by
compet|t|on (IC and agus)
W Groom|ng products a
|uxury
W Ma|n compet|tors are
cheaper
W ow shav|ng |nc|dents and
s|ow grow|ng beards
W Government regu|at|ons
on d|rect d|str|but|on or d|rect
|mports of products
What factors determ|ne demand for razor b|ades?
Des|re to |mprove |mage
Inf|uence of western groom|ng pract|ces
@rendsetters co||ege students and graduates
Inf|uences on razor purchase
Lffect|veness (c|oseness of shave
reduced shav|ng t|me no cuts etc)
She|f |fe (reusab|||ty w|thout reduc|ng
effect|veness)
ffordab|||ty (va|ue for money)
ow |s G|||ette do|ng |n Indones|a?
Sa|es
W In country shav|ng product
sa|es of 5196 m||||on |n 199S
W 9ro[ected |ncountry shav|ng
product sa|es of 5276 m||||on
|n 1996
W @ota| sa|es revenue expected to
|ncrease by 0 |n 1996
W 9rof|t from operat|ons forecast
at 20 |n 1996
Market 9enetrat|on
W 97 brand awareness
W SS of the brands used
most often
W 90 of the prem|um
pr|ced segment
W 60 r|se |n sa|es
through |mp|emented
d|str|but|on methods
9roduct|on Supp|y
9rocesses eff|c|enc|es reduce product|on t|me
Capac|ty |ncreased
Iema|e razors customs |ssues
ow can demand be |ncreased?
W Increase customers and frequency of use
W Market b|ade over kn|fe advantages
W Infer|or qua||ty b|ades show d|sadvantage
W Market to women
W Cons|der |ntroduct|on of budget product
W Market comp|ementary products (eg
shav|ng creams)
W Unfash|onab|e stubb|e
ecommendat|ons So|ut|ons
dvert|s|ng 9romot|on
1 9ersuade customers to shave more often
2 Upgrade to h|gherend products
3 Strengthen promot|ona| presence at 9S
Good re|at|onsh|ps w|th supermarket segment
S Incent|ves for supermarket she|f space
6 G|fts |ucky draws coupons and redempt|on systems
7 Cu|tura||y appropr|ate market|ng |n |oca| |anguage
9romote use of shav|ng creams and other products
9 @argeted promot|on to fema|e segment
and @ra|n|ng
10 vercome m|sunderstand|ngs re d|fferent cu|tura|
behav|ors
11 Lmpower sa|es team to
e|p d|str|butors update d|str|but|on methods
Lducate d|str|butors and |oca| market about shav|ng concepts