Clean Edge Razor case
What changes are occurring in the non-disposable razor category? Assess Paramount’s competitive position. What are the strategic life-cycle challenges for Paramount’s current products as well as Clean Edge?
Changes in the non-disposable razor category in the recent years:
It has become harder for newer and smaller players to grab the market share because of increased advertising expenses. However, for bigger and established players it has not increased significantly.
1. With the advent of male-specific personal care products, male grooming products seems to be a growing in the industry; growth in this segment has outpaced that of women’s personal care market.
2. 5 percent growth per year from 2007 to 2010, attributed to innovations and product introductions.
3. Diversified as better margin derived from the product brought in retailers in the form of club stores and other stores.
Earning over $13 billion in revenue and $7 billion in profits during 2009, Paramount has become a global consumer product giant. Its competitive position include:
1. A respected brand in non-disposable razor market.
2. 23.3% market share by volume of overall non-disposable razor unit and market leader in moderate non-disposable razor unit both by volume and dollar.
3. Having said this, new players with technologically enhanced products pose a threat to the company.
Strategic Life Cycle Challenges:
Clean Edge Razor – A product that uses “superior: technology and a 5 blade design. It would give enormous boost in sales provided that it does not cannibalize the existing non-disposable razor segment – which is doing moderately well for the company.
With this objective in mind, company had to choose between three alternative strategies which are:
a. To launch the Clean Edge razor as a mainstream technology product,
b. To launch the razor as a “niche” revolutionary technology product, or
c. To create a new...