Gillette Personal Care Division: Marketing Planning and ControlA Case Study

MembersAmbica Prasad Patnaik PGP/14/192 Gopi Krishna PGP/14/196 Naveen Kiran PGP/14/220 Pawan Jagnik PGP/14/224 Rajkumar Deegwal PGP/14/233 Satya Sekhar Babu.K PGP/14/240

Introduction:Gillette was founded in 1901 by King C. Gillette. It was a leading International Manufacturer of consumer products ranging from Electric razor to ballpoint pens. Gillette has three divisions: 1. Safety Razors (Blades and Razors) 2. Paper mate Division (Writing Instruments) 3. Personal Care Division-PCD. (Hair Care , Skin care, Deodorants/ Anti-perspirants) The Brands of Gillette are divided into four rough categories: Build, Hold, Harvest and Withdraw. Mennen and P&G are the major competitors for Gillette. Right Guard pioneered in United States with a unit Market Share of 26% in 1967. But Because of fluorocarbons scare burst by mid 1982 its market share was dropped down to 8.5%.White rain was a shampoo that was introduced in low price category in 1952,but it was phased out in late 1970.PCD division of Gillette decided to roll out new version of shampoo and conditioners in May 1985 and as soon as it was launched it was a resounding success. Problem Statement: y y y Ineffectiveness of Gillettes planning and control system Revitalization of Right guard brand to increase its market share Finding ways to build upon the success of white rain to increase market share

Analysis:

Gillettes Marketing Planning and Control SystemPlanning and control of system was too rigid and time consuming and it lacked central control mechanism. Even though it is followed it may not give the expected results, for example white rain was launched without completely following the system but still it was a resounding success. Gillettes system was basically divided into two subsystems, Planning system and Control system. Planning system consist of preparing Fact book in the month of April through a series of meeting amongst brand managers, sales managers and field representative. Fact book is based upon sales /marketing meeting, marketing research division (MRD), outside market research and brand management. During next three months Brand managers develop marketing plan based on the brand factbook. Refined marketing plan then goes to operating committee for further approval. Once it gets the approval from the operating committee (Chaired by Bill Ryan) finance section prepares budget which incorporates quantitative forecasts from the marketing plan. After this marketing managers and Bob forman (VP marketing) devises a strategic business plan which categorizes the brand into four different categories: y Build-To build market share y Hold-To maintain share and profit levels y Harvest-To maximize cash flow y Withdraw-To make painless exit from the market After approval from operating committee Strategic business plans were reviewed by Derwyn Philips (Head Gillette North America)and Joseph Turley(Company head).

Control department was involved in implementation of the marketing plans formulated by the planning department. In order to have a clear understanding of the difference between forecast and actual sales PCD managers relied on a number of regular reports. Reports were on Daily Sales, Monthly Sales Forecast, Nielsens two-Outlet Flash report and the merchandise flow produced by Marketing Research Division. MRD also provided managers with internally generated research reports. Based on the internally generated reports MRD performs national consumer study(NCS) for each brand category and does segmentation studies for individual brands.NCS helps managers to know whether the brand was on target for its budgeted profit contribution. RIGHT GUARD Right guard was launched in 1960 and by 1967 it emerged as a premier deodorant brand in United States with market share of 26%.But later in mid 1970s fluorocarbon scare tarnished the image of aerosol form of antiperspirant thereby reducing Right guards market share down to 8.5% by mid 1982.Right Guard lost its 20 year market leadership to Mennen companys product. Right guard even after losing the leadership still accounted for 15% division sales and 25% operating profits, so it was a difficult brand to lose. This triggered the idea of restage of brand Right guard by introducing it in new chemical form and fragrance. The restage was scheduled for three years starting with the year 1983.For the first five months the new product was kept under low level of advertisements. The new product came to retail shops during the second quarter and simultaneously increasing its advertising campaign budget to $12.7mn which still was less as compared to Mennen. The market competition increased furthermore in 1982 with P&Gs entry and Mennens new product, Lady Stick. The restage appeared weak because target male consumers ranked right guard well below chief competitor Mennen and Old spice on key factors such as product effectiveness, application aesthetics and value for money. Despite all these facts Pat Flaherty put Right Guard in Hold Category and in 1986 the target market was refocused to 12-24 in order to revamp the brand.

White Rain

White Rain (WR) was a less known brand of the Gillette which launched its better version of WR Shampoo in 1985.It was planned to be placed as a strong price value brand. Also, its sales were skewed regionally i.e. in some regions it performed better and in others it did not. The product was therefore test marketed using the consumer use test to find the attitudes of the consumers towards the product. The market planning process for the product was informal with minimal documentation. Also novel methods of sale were followed. WR was launched in the already strong markets of Gillette to test its market acceptability. It gained 3% market share in 2 years. But still 3% market share was low and there was tremendous opportunity to grow this brand and increase its market share.

Situation Strategy Expectations Effort

Right Guard Planned and well built Carried the Brand Image High Heavy Investment and proper planning and organization. Fluorocarbon Scare which was primary cause for its downfall Stiff competition from Mennen and P & G 12.9 $ Market Contribution

Market

White Rain Unplanned and small Pure risk and opportunism Low Low Investment in terms of money and heavy in terms of management Always was performing better than the expectations Sauve. But high price of it turned in WRs favor 3% Market Share.

Competition Results

Recommendations: y Planning and control system of PCD of Gillette should be more flexible and it should be made less time consuming. There should be a central database which should have all the brand information and should be accessible to all the departments. Right guards modified version should be launched in such a manner so that the peoples perception about aerosol can be changed. White rain success in the market should be capitalized upon to increase its market share and to increase the good will of the company in the market.

y

y