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Clean Edge Razor KELOMPOK 7 MM KELAS 27C
DIAN ATIKA, RAFIKA, RERY INDRA KUSUMA
Clean Edge Razor
Clean Edge Razor
Case Summary
Main Issue
Problem Statement
Analysis
Recommendation
Desk Edge Razor
Case Summary
Clean Edge Razor
- Paramount Health and Beauty Company, known as Paramount, is a global consumer products giant with four corporate divisions including Health, Cleaning, Beauty and Grooming.
- Paramount entered the non-disposable razor market in 1962 and quickly became a market leader.
- Paramount offers two products, the Paramount Pro in the moderate segment of the product market and the Paramount Avail, which was considered the value offering market.
- With these two products the company enjoys 23.3% (2009) of the retail share.
Clean Edge Razor
- By 2009, the company realized $13 billion in worldwide sales and $7 billion in gross profits, with the non-disposable razors and refill cartridges in the U.S. contributing $170 million in revenue, gross profit of $92 million, and operating profit of $26 million.
- The company has developed their newest non-disposable razor, Clean Edge, which is currently undergoing review by market testers.
Clean Edge Razor
SUPER-PREMIUM
34%
MODERATE 44%
VALUE 22%
SALES
SUPER-PREMIUM 25%
MODERATE 43%
VALUE 32%
VOLUME
NON DISPOSABLE RAZORS AND REFILL CARTRIDGE RETAIL SALES BY SEGMENT FOR US MARKET (2009)
Clean Edge Razor
PARAMOUNT
PRINCE
B&K
RADIANCE SIMPSONS
OTHER
PARAMOUNT COMPETITORS AND MARKET SHARE (2010 E)
Market leader since 1950s, U$ 224 M revenue, U$45 M operating profit, 26,2% market share, brand: Cogent
Brand: Vitric, 21,1 % of market share
Brand: Naiv, 2,6% of market share
Brand: Tempest 5,7 % of market share
23 % of market share
21,4 % of market share
Clean Edge Razor
Main Issue
Clean Edge Razor
1. How Should Edge-Razor Enter The Market
2. Positioning strategy for the Clean-Edge
3. Brand Name for new product
4. Market budget for promoting Clean-Edge
Clean Edge Razor
Problem Statement
Clean Edge Razor
Market
Segments
Super-Premium
Mainstream Niche
Moderate Value
MARKET SEGMENT
Clean Edge Razor
ALBERT ROSENBERG
WILLIAM KIM
POSITIONING STRATEGY
Clean Edge Razor
BRAND NAME CONSIDERATIONS
Paramount Clean-Edge
Clean-Edge Paramount
Clean Edge Razor
MARKETING BUDGET ALLOCATION
•$ 15 Million NICHE
•$ 42 Million MAINSTREAM
Clean Edge Razor
Analysis
Clean Edge Razor
VIBRATING,ULTRA- THIN, 5 BLADE RAZOR
A LARGER ,HEAVIER HANDLE FOR A BETTER BALANCE ,GRIP & CONTROL VIBRATION FOR STIMULATE HAIR FOLLICLES, 25% INCREASE IN HAIR REMOVAL
CLEAN EDGE DESIGN AND TESTING
Clean Edge Razor
COMPARE THE SUGGESTED PRICE (IN MAINSTREAM POSITIONING) WITH COMPETITORS
Super Premium
Razor Standard Refill Cartridges
Cogent Plus $12.50 $10
Cogent $11.19 $8.89
Clean-Edge $11.19 $8.89
Naiv $11.80 $9.45
Vitric Advanced $11.20 $8.99
Vitric Master $10.85 $8.65
Tempest $10.99 $8.75
Clean Edge Razor
Niche Mainstream
Year 1 Year 2 Year 1 Year 2
unit price dollar unit price dollar unit price dollar unit price dollar
Razors sales 1 9.09 9.09 1.5 9.09 13.64 3.3 7.83 25.84 4 7.83 31.32
Cartridge sales 4 7.35 29.40 10 7.35 73.50 9.9 6.22 61.58 21.9 6.22 136.22
Total Sales (1) 38.49 87.14 87.42 167.54
Razors Production cost 1 5 5.00 1.5 5 7.50 3.3 4.74 15.64 4 4.74 18.96
Cartridge Production cost 4 2.43 9.72 10 2.43 24.30 9.9 2.24 22.18 21.9 2.24 49.06
Capacity Cost 0.61 0.87 1.71 2.45
Advertising & Promotion 15.00 16.00 42.00 39.00
Total Cost (2) 30.33 48.67 81.53 109.47
Profit (1-2) 8.16 38.47 5.89 58.07
Profit % from sales 21.20 44.14 6.74 34.66
Profit and Loss Forecasts for Clean Edge Under Niche and Mainstream Scenarios
Clean Edge Razor
SEGMENT MARKET COMPARATIONS
NICHE
• Create a One Strong Brand
• Avoid Cannibalization
• Lower Marketing Investment than Mainstream
• Higher Gross Profit than Mainstream
MAINSTREAM
• Replace Paramount Pro (Cannibalization)
• Higher Marketing Investment
• Lower Gross Profit
Clean Edge Razor
BEHAVIOR SEGMENTATION OF NON DISPOSABLE RAZOR CONSUMERS
Social/Emotional Shavers (39%)
Aesthetic Shavers (28%) Maintenance Shavers (33%)
Differentiate among product. Search for product based on both functionality and messaging. Shaving as an essential part of a daily grooming ritual. Shaving makes them feel more attractive and confident.
Search for product that most effectively remove hair. Shaving is consistently done to remove unwanted hair. Shaving is a means to smooth skin they desire.
View product as the same. Lack of interest in product category. Shaving routine is inconsistent. Shaving is a chore they try to finish as quickly as possible.
Clean Edge Razor
Recommendation
Clean Edge Razor
WE PREFERED “NICHE POSITIONING”
TARGETING THE MOST APPROPRIATE SEGMENTS
39%
28%
33% SOCIAL-EMOTIONALSHAVERSAESTHETICSHAVERS
MAINTENANCESHAVERS
CHOSE 2 SEGMENTS : SOCIAL-EMOTIONAL AND AESTHETIC SHAVERS (TOTAL SEGMENT 67%)
Clean Edge Razor
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