Clean Edge Razor: Splitting Hairs in Product Positioning

despoil perimeter razor Splitting Hairs in Product Positioning Name Yuanxu He (Jason) Semester Fall, 2012 Course Number MBA 812A go steady of paper September 25th, 2012 Executive Summary The make clean Edge which is prevailings newest nondisposable shave has powerful influence in the market place since 2010. It was improved design and used the new skills to crap the shaves properties become better than before. Lots of men like it and consider it was the closest, cleanest and smoothest. The word compend the rifes situation, competition, result positioning, merchandise strategy finished the U. S. azor market, market segments and consumer behavior and the trends of nondisposable razors and refill cartridges. After the company overview, the analysis of competition, design and testing and compargon the marketing budget, Randall think that the Clean Edge has the signifi micklet mainstream potential and provide become the new standard in mens graze.1. Non-disposable razor c ategory has changed a lot these years. The phrase pointed that nondisposable razors experienced approximately 5% growth per year from 2007 to 2010. legion(predicate) innovations and product in the super-premium segment has grown a lot.The expenses of advertising change magnitude a lot because of the need to promote new benefits from advances in razor technologies. Changes in retail channel distribution have also been famous in the category. Male-specific grooming products seemed to be a bright spot in the industry from 2007 to 2010 and the segment saw much much growth because shaving became much than just shaving it started to include body spray, fragranced shower gelatin and skincare lines proliferated. Channel distribution for the razor category has become progressively important through the Exhibit 4. It has been quite demand for male-grooming products.Competitive Position preponderating has been a global consumer products giant with over $13 billion in worldwide sales and $7 billion in gross meshwork for 2009 since it entered the nondisposable razor market in 1962. Paramount established itself as unit-volume market-leader in 2009 based on nondisposable razor sales. The nondisposable razor category market is entering a new phase with engine room products and new competitors entering the market, its a threat to Paramount. Strategic smell Cycle Challenges Consumers are becoming more experienced and always look for new technologies.Namely, they want to spend more money and buy products which are satisfy the necessity of a smooth shaving experience. In former(a) words, through the Exhibit 1, there is a category of consumers called sustainment users that make up 33% of consumers they were not interested in buying products with transcendent technology. These consumers cannot be ignored. So, to the challenges, it should provide a product with good toll x benefit but with a short life bicycle for the 33% called Maintenance users keeping these use rs buying their products and interested in their brands. And then, launch the Clean Edge product with a longer life cycle. Meanwhile, making this product profitable creating a high quality from the consumer when they buy cartridges for refill.2. The nondisposable razor market is segmented to three parts base on harm and quality which are value, moderate and super-premium. From 2009, consumers purchased razors and replacement cartridges more frequently and they were explicit to Maintenance Shavers, Social/Emotional and Aesthetic. The Maintenance Shavers who almost not interested in the product category. The Social/Emotional shavers were motivated by the overall shaving experience and Aesthetic shavers were interested in cosmetic results.3. Niche Mainstream Pros Cons Pros Cons Increase profits and market share Increased marketing budget cost to launch the new product and provide incentives to Maintenance users Increase profits Potentially could result in elimination of Paramount Pro Existing products can be retained and used to get Maintenance users Increase market share Paramount will not be focusing Maintenanceusers with new product line brand strategy can be arefully planned and deployed for maximum success process prevent loyal Paramount customers form being wooed away to more innovative brands Opportunity to utilize existing products and gain increased sales Through the pros and cons, I will recommend the Clean Edge for a niche strategy. Because Rosenberg said that they will siphon off consumers if he considered a mainstream positioning strategy. A niche strategy will make more sense.4. Niche Mainstream Planned capacity Razor (Year 1) 1. 0 3. 3 (Year 2) 1. 5 4. 0 Razor Production per unit cost $ 5. 00 $ 4. 74 Razor Manufacturer cost $ 9. 09 $ 7. 83 Razor Suggested price $ 12. 99 $ 11. 19 Revenue (Year 1) 9. 09 25. 84 (Year 2) 13. 64 31. 32 Production cost (Year 1) 5 15. 64 (Year 2) 7. 5 18. 96 Planned capacity Cartridge (Year 1) 4. 0 9. 9 (Year 2) 10. 0 21. 9 Average Production unit cost $ 2. 43 $ 2. 24Manufacturer price $ 7. 35 $ 6. 22 Suggested price $ 10. 50 $ 8. 89 Revenue (Year 1) 29. 4 61. 58 (Year 2) 73. 5 136. 22 Production Costs (Year 1) 9. 72 22. 18 (Year 2) 24. 3 49. 06 Capacity costs (Year 1) $ 0. 61 $ 1. 71 (Year 2) $ 0. 87 $ 2. 45 Advertising (Year 1) $ 7 $ 19 (Year 2) $ 7 $ 17 Consumer (Year 1) $ 6 $ 17 (Year 2) $ 6 $ 14 cover promotions (Year 1) $ 2 $ 6 Year 2) $ 3 $ 8 Subtotal of Other Costs (Year 1) 15. 61 43. 71 (Year 2) 16. 87 41. 45 Total Costs (Year 1) 30. 33 81. 53 (Year 2) 48. 67 109. 47 Trough the chat above which compares the revenues and costs, its easily to find out the Niche is the better one. About the marketing budget, through the comparing, the advertising and promotion of Clean Edge Razor is $15m and $ 16m, and we can reduce the budget for existing products of advertising.Because the consumers become more sophisticated and the explore shows that these will be the mature phrase of the produ ct life cycle in the future. I consider that if it launch the product to the Niche market, it will beget a huge profit to Paramount. So, I want to make the brand name called The Clean Edge Razor by Paramount.ConclusionBy the time, consumers genuinely purchased razors and replacement cartridges more frequently than they than in any year previously. Its no doubt that the Clean Edge has huge potential in the super-premium segment.It should keep developing by the Niche strategy and this will bring the biggest benefits and profit to the company and beat the other competitors.Work Cited S. E. Smith, One Tool, Many Uses angiotensin converting enzyme Edge Razor, (Aug 02, 2012), http//www. networx. com/article/one-tool-many-uses-single-edge-razorJeremy Pingul, Paramount Health & Beauty The Clean Edge Razor, (2012, January), http//prezi. com/pjd6evuzfndc/paramount-health-beauty-the-clean-edge-razor/