Problem:
Paramount Health is in the process of unveiling a new industrially advanced non-disposable razor “Clean Edge”. With its improved design, Clean Edge offers superior performance by utilizing a vibrating technology to stimulate hair follicles and lift the hair from the skin, allowing for a more thorough shave. The company has decided to introduce it in the men’s market where it has a strong presence. The company is now concentrating on positioning and naming of this new product. It also needs to decide on the promotional activities to be performed adhering to the budget constraints and also must decide on the distribution channels through which it can reach to the masses. Industry experts have divided the non-disposable razor and refill cartridge market into three segments based on price and quality: value, moderate and super premium. Paramount currently offers two products: Paramount Pro operating in the moderate segment and Paramount Avail operating in the value segment. With these two products, it captured the unit-volume market leader position with a 23% retail unit share and is now a respected brand in the industry. Neither Pro nor Avail had introduced significant technology innovations in the last five years. In the last decade, the industry has experienced significant growth in the super premium segment and has catered various product innovations and new technologies. The executives of the company have come to a consensus that the Clean Edge razor should be priced in the super premium segment. But they are still unconvinced on how to position the product. One strategy is to release the product into the mainstream razor market within the super-premium segment and position it as the most effective razor available. Another is to introduce it as a niche product targeting the most intensely involved super premium consumers who look for superior skin care products. Both the positioning strategies have their own pros and cons.
Analysis:
The company...