Posts Tagged ‘Brands’

It is hard to ignore the increased frequency at which men can be seen with a beard of some form or style on their faces in recent years. Beards have become popular especially among young men towards or in their early twenties. The renewed fashion of growing beards is making troubles for 115+ years old Gillette, once an independent company and since 2005 a division and brand of consumer packaged goods giant Procter & Gamble (P&G). The difficulties for the famed brand of razors and blades caused by changes in shaving habits of male consumers have been further exacerbated by increased competition and the growing shift to e-commerce. Yet above and beyond, Gillette faces a key challenge to defend and sustain its brand equity, arising from its reputation and position of leadership for many years.

Indeed ‘beards’ are far from being uniform. Beards, and facial hair in general, can be thick or thin, with or without a moustache, covering the cheeks or leaving them clear (see for example the  top 15 beard styles described by Gillette). Often enough the beard is not much more than stubble kept growing for a few days. But beards should be more than a matter of avoiding a shave everyday. As said above, there are different shapes and styles of them, and to keep the beard in form and in good appearance, one has to cultivate and nurture his beard on a regular basis.

  • From the late 19th century and through the first half of the 20th century the moustache was the epicentre of facial hair for men. It was a fashionable sign of manhood, and there were some creative and artistic designs of them.

According to figures from 2013, it was estimated that 17% of American men grew a beard of some form in that year, up from 14% in 2009. Beards are particularly frequent among young US men age 18-24: 35% in 2013 compared with 31% in 2009 (Experian Marketing Services, 14 March 2014; the estimate of ‘bearded men’ is based on a definition of men not using any shaving products or men who use electric shavers or shaving cream (foam) fewer than two times per week [to be distinguished from watching men and counting those bearded]).

The problem of Gillette seems to be aggravated, however, by a reduced frequency at which men shave per week. It is increasingly popular to grow a 2-day, 3-day or 5-day beard. If to judge by the frequency of using shaving cream, US men used it 4.5 times per week in 2009 versus 4.3 times in 2013 (mean 3.5-3.6 among 18-24 years old). Therefore, this is not simply a question of whether an individual uses shaving products, particularly disposable razors and blades, but how much one uses them (and thereof pays to buy them). It should be noted that just 15% of young men age 18-24 in the US have had a thick beard (using no shaving products) in 2013 (2009 13%);  among those in the next age group of 25-34 years old this proportion was a minor 5%.

  • In other data (by Mintel) for 2015, 41% of men using shaving products in the US do not shave daily (50% of  18-24 years old, 51% among 45-54 years old). Nonetheless, among those who do not shave daily not all is lost, probably far from it.

Hence, there is a different way, more optimistic, to look at the situation. Many of the men who grow some form of a beard do have to continue to shave regularly enough. First, it can be noticed that many of the young men grow a rather thin and light beard. Second, many grow a beard on part of their faces (e.g., around the mouth) and hence have to keep shaving the remaining areas where facial hair grows. Therefore, instead of looking at how men do not shave or shave less frequently, one should look at the frequency they do shave, when and how. Additionally, men who grow thin and partial beards can be encouraged and advised on nurturing their beards, keeping them in line and aesthetically appearing. In fact, Gillette demonstrates in videos on its country-websites how to do so with their manual shaving products, a step in the right direction (note: similar instructive videos are available from other sources as well). Nevertheless, more emphasis may have to be given to trimmers for cutting off more dense facial hair to offer customers a more complete solution.

Shaving manually with razor blades is a ritual that demands time, patience and care. It involves three main stages and requires the use of supplementary products (e.g., pre-shave lotion, shaving cream or foam). Part of the market of manual razors and blades has been captured years ago, especially in developed countries, by electric shavers for the greater simplicity of shaving with them and also for being safer. In the US, the ratio between shaving methods stands (2013) at about 3:2 — 6 users of disposable razors and blades to 4 users of electric shavers (Experian). Younger men (18-24) tend somewhat more to prefer manual shaving over electric shavers. If it gives any consolation, only 27% of American users of electric shavers apply the machine daily (i.e., 7+ times per week). In addition, users of electric shavers seem to have lowered their frequency of shaving (mean uses per week): 4 in 2009 versus 3.7 in 2013 (18-24 years old use them less frequently to start with, 2.5-2.6). A possible lesson from those revealed figures might be that men in developed countries should not be expected nowadays to shave daily, perhaps only half as frequently, using either manual or electric devices.

In some ways, as suggested below, the management of Gillette can draw back users of electric shavers to using the brand’s razors and blades. First, users of electric shavers may be convinced of a greater accuracy in which Gillette razor blades can be used to keep, for instance, a beard within its intended  border lines. Second, while men may not find the time and patience to shave manually during the week, they may see the benefits of doing so, instead of using the electric shaver, on weekends and holidays when they have more time to groom themselves. It may be possible to widen an already small overlap that appears to exist between the use of electric shavers and the use of disposable razors and blades.

  • P&G also markets the Braun brand of electric shavers (foil covering a straight-line blade). Philips, a leader in electric shavers (round rotary heads), is offering models with or without a pop-up trimmer on back of the handset shavers; a trimmer is also available as a separate device, as may fit the need to separately treat more dense hair. (Royal Philips has been re-aligning its business in the past few years, but it seems to have found a place for its shaving products in the personal care category for men as an extension to health-care technologies).

Gillette looks as an autonomous division of P&G, almost independent from it. It may get even more freedom than other brands in the house of brands of P&G. Indeed, Gillette has been an independent strong brand for many years and is still capable of being a driver of consumer choice without the help of the corporate name of P&G. Moreover, Gillette has been and remains the endorser of product brands such as Sensor (since 1990), Mach 3 (since 1998) and Fusion (since 2006; Fusion has two premium sub-brands ProGlide and ProShield). The three product brands may be strong enough each to share a driving power equally with the endorsing Gillette name. Some consumers may know that Gillette is owned by P&G and they may value the solid backing it can give Gillette, but it seems the P&G name has no more than a role of shadow endorser [1]. The root (US) website of Gillette and its various country-websites make no reference to P&G in their content; the only mention given is a title at the top left corner saying “Part of the P&G family”. This approach thus helps in instilling the notion that Gillette acts as a stand-alone brand (or brand tree).

The cost of replacing the disposable razors (‘handles’) and blades of Gillette has become a key issue for the brand in the last ten years. The ‘heads’ that contain the blades (e.g., Sensor with 2 blades, Mach has 3 blades and Fusion has 5) seem to cause the greater burden for users, especially as they have to be replaced more frequently than the razor on which the ‘head’ is mounted. Gillette has embarked on a major effort in the US to lower their cost and bring back customers — the US website includes a ‘Pricing’ page introducing a special Lower Prices offer on razors and blades (these are recommended retail prices that Gillette is careful to stress it cannot guarantee for every retailer). A similar ‘Pricing’ page appears on the Canadian website but without details of prices, while no such page appears on websites of other countries (e.g., Australia, UK, Germany, Argentina, South Africa). Additionally, Gillette publishes on its American website a ‘Letter to Consumers’ from its employees as part of its effort: showing how they listen to consumers, and expressing gratitude to those who have already returned after trying razors and blades of competitors (attributed to Gillette’s quality advantage and their lower price offering). It begs one to wonder why this effort is limited to North America.

A threat to Gillette has come primarily from online retailers such as Dollar Shave Club (now owned by Unilever) and uprising Harry’s. At first, men reacted to increasing costs of blades by growing beards and shaving less frequently, but then also by turning to online suppliers. Dollar Shave Club was estimated to have an online market share in 2016 of 52.4% on razors and blades, and Harry’s obtaining 9.4%. However, Gillette has also entered into selling its razors and blades online and launched a customer Club in 2014; in 2016 its share online was estimated at 21.2% (CNBC, 7 August 2016, estimate figures provided by Slice [Ratuken] Intelligence). An increasing interest in subscription plans was further noted by Mintel (5 Nov. 2015) — such plans offer razors and blades at lower prices with the advantage of providing also supplementary shaving products; all can be ordered together in convenient packages. Gillette had to adapt to the new conditions, including the shift in consumer behaviour and new market rules (i.e., e-tailing). The subscription scheme of Gillette Club is available mostly in Western countries of North America and Western Europe (notes: in some countries it is labeled ‘On Demand’, and in the scheme described online, orders are set to be fulfilled via retail stores).

  • Gillette was acquired by P&G in 2005 for $57Bn. In May 2018 the Gillette brand was ranked #32 on the List of Most Valued Brands of Forbes, valued at $17.1Bn. Market share of razors in the US has been sliding down during six consecutive years, from 70% in 2010 to 54% in 2016. Since 2012 the sales of Gillette have declined from a peak of $8.3bn to $6.8bn in 2016, and dropped another 3% in 2017 to $6.6Bn. There is an anticipation now that the Club would help to halt the decline in 2018.

The slogan of Gillette, sustained for several decades already, is “The Best a Man Can Get”. Gillette has been thriving for excellence in the area of shaving as a cornerstone of its brand equity. It has won its recognition as a leader based on high perceived quality of its shaving products, especially its razors and blades (as a ‘power brand’, it achieved a central category benefit [‘the closest shave’], and has been continually improving [2a]). An association that resonates with consumers is significant for brand-building; it has to be meaningful and relevant to them. David Aaker and Erich Joachimsthaler noted in their book ‘Brand Leadership’ that Gillette was among the brands “that have high customer resonance because their customer value proposition is highly relevant” [2b]. This could be the prime challenge of Gillette as a brand for the coming years: The high quality of its products is undeniable, but can it uphold its relevance to consumers?


In its struggle to bring customers back, a national advertising campaign to persuade men to shave again has missed its target. An Israeli advertising agency (ACW) created a campaign titled ‘The Dad Test’ featuring a ruler for measuring how much a beard or stubble hurts babies by scratching the baby’s face (2017). The campaign stirred protest and anger for being insensitive and aiming low (Mako-Keshet TV, 7 June 2017 [Hebrew]). First, the ‘problem’ the ad caught onto is hardly new. Second, the campaign took an offensive stand by raising a conflict, alienating customers, and thus was shooting in the wrong direction. (ACW is affiliated with international advertising agency Grey; this campaign does not seem to have appeared outside Israel).

The US-based advertising agency Grey New-York launched in the past three years ad campaigns, for American Father’s Day, that seem to adopt a more positive and constructive approach to father and son relations: (1) In 2016, ‘Go Ask Dad’ instead of turning to the Internet (The Drum, 19 June 2016); (2) In 2017, ‘Handle with Care’ featuring a son helping his elderly father shave (AdWeek, 22 June 2017); (3) In 2018, ‘Your Best Never Comes Easy’, meant to redefine or re-establish the brand’s slogan (AdAge, 11 September 2018). A leading theme in these ad campaigns is connecting fathers and sons with a razor product of Gillette as the pivotal mediator. They may also be noted for enhancing a functional benefit of Gillette with an emotional benefit.


An approach that may help Gillette paving its way forward is looking through the lens of The Theory of Jobs to Be Done developed by Clayton Christensen [3]. In order to attract customers and keep them, a company has to understand the goal or task the consumers wish to accomplish and focus on how its designated product will help them in making progress towards achieving their goal (i.e., ‘getting the job done’). Furthermore, jobs are context-dependent, that is, in different circumstances or conditions the consumer may need the same product to do differing jobs. In the case of shaving razors and blades, we may posit ‘jobs’ such as: (1) What type of look men wish to display with their beards — does the consumer want to foster a ‘neat and elegant’ look or is he interested in appearing ‘rough and tough’? — from here a company may derive the extent to which razors have to provide a close shave and accuracy; (2) The main concern of male users may be that shaving will be easy and convenient, and without taking too much time (say 10 minutes). An additional goal for shaving may require that it is more economically affordable. Taking these options into consideration, it may prompt Gillette to examine whether consumers can easily distinguish between the different razors it offers and trace which model of razor and blades is most appropriate for the job one wants to accomplish.

The challenges Gillette has to resolve may be divided into two levels. In the short to medium term the brand may be more engaged in tackling the contemporary fashionable trends in growing beards and thereby the shifts in shaving behaviour of male consumers. There is little point in speculating how long this period may last — the brand just has go through it and adjust its product offerings and marketing. In the longer term, more crucially, Gillette will have to be concerned with sustaining the relevance of the brand (e.g., fit for a job) to men, younger and older, and ensuring that associations they hold of the brand remain valid and meaningful. On that depends the future of Gillette.

Ron Ventura, Ph.D. (Marketing)


[1] Based on the model of brand architecture in: Brand Leadership; David A. Aaker and Erich Joachimsthaler, 2009/2000; London, UK: Pocket Books (paperback edition, originally published in 2000 by Simon & Schuster UK)

[2] Ibid. 1: [a] (p. 67) and [b]  (p. 89)

[3] Competing Against Luck; Clayton M. Christensen with Taddy Hall, Karen Dillon, & David A. Duncan, 2016; Harper Business (HarperCollins Publishers)










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Since the late 1990s we have been trained to expect better opportunities to make money by investing in companies that have to do with technology: computers, Internet, information (IT), software, mobile devices, telecom, and so on. Despite some hurdles (e.g., the burst of the Internet bubble in 2000), interest remains very high in these areas from entrepreneurs, equity fund managers, private investors, and the media. In a special investors issue last month, Fortune magazine (2 July, 2012) chose to bring-up a different perspective, reminding us that much potential for growth over years can be found in strong consumer brands of the more casual and traditional types of products. These products include food, drinks, and household maintenance goods — grocery or staples — that everyone bascially needs to run his or her everyday lives, and enjoy a little beyond.

Brands of foods and drinks, for instance, may not produce yields rising as fast and handsomely as in digital technology but they tend to grow more steadily and persistently over multiple (e.g., 2o or 30) years, which makes them better targets for investment to save for our retirement stage in life. Yields may be understood as both dividends paid by the brand-owner companies and the gradual increase in share prices over the years. Relative to 1990, the Standard & Poors (S&P) Consumer Staples Index returned 854% while the general S&P Index rose 536%. However, two particular episodes are noteworthy: (1) During 1998-2000 the S&P consumer index fell from 400 to 250 while the S&P general index kept rising mildly, but then in 2000-2002 the consumer index recovered as the general index fell by 50% to 200 and kept producing lower returns; (2) Even more dramatically in 2007-2008, the general index suffered much worse (falling from ~500 to 200) than the consumer index (falling from 600 to 400), leaving a gap larger ever since 1990 between the two indices.

One of the advantages of the consumer brands of staples, as explained by Fortune’s writer Cendrowski, is higher predictability — managers can make safer and more accurate forecasts on how their branded products will perform between two and five years, compared with the technology products (i.e., “good luck guessing, say, which brand — or type — of computing device will be hot in five years?”). No one argues that forecasts for staples can be made err0r-free, yet analyses of past sales and research on consumer trends can make it easier to tell how consumers will use those products and their brands in comparison with the frenzy consumer technology categories. According to selected veteran investors cited by Fortune, strong brands might prove as more solid anchors for investment; although the chances of winning a fortune on them in a short-term are relatively low, keeping to the stocks of their companies will pay-off as the stocks climb inch-by-inch (re-investing dividends can add up to even higher returns later on). The advice to trust the stronger brands and patiently hold to them is well-appreciated. Two cautious reservations are in order, though: the article does not distinguish clearly enough whether the type of product or the status of the brand is the main source of this policy’s benefits, and it seems to brush aside the fact that corporations that own and manage the more familiar and favourable brands run sometimes hundreds of brands (e.g., Unilever, Nestle, Procter & Gamble, Johnson & Johnson) but stocks don’t distinguish between successful and much less successful brands — one invests in the whole portfolio. One does rely, nevertheless, on the expectation that a company that manages a bundle of strong brands does overall far better than competitors that have fewer or no such brands in their portfolio.

As we appraise the prospects of strong consumer brands, we should take into consideration that many of the developed and affluent countries are currently in recession or slow-down of their economies, which adversely affects the purchasing power of consumers (i.e., due to high unemployment rates, more half-time and temporary jobs, eroding real wages and salaries, financial losses on savings). While companies that own strong brands are more likely to have deeper pockets to help them go through such difficult periods with less harm, consumers may be much less willing to pay the high price premiums those brands often charge. These premiums are key expression of the brands’ higher equity and lever of revenue. As a recession extends longer, consumers may become more accustomed to modified decision strategies and purchasing behaviour patterns that farther distance them from the advantageous and higher priced brands.

On the other hand, there is the danger of inflation. A risk of inflation is looming in developed countries because of their very low interest rates (around 1% in 2012).  Fortune’s article highlights the pricing power of strong brands to overcome inflation. Rightfully, consumers are more tolerant to price rises undertaken by stronger brands. But this known propensity is not guaranteed to survive well during inflationary price hikes that continue over and over again. The power to overcome inflation is attributed in the article to a life-time commitment of customers to those brands. Two aspects are confounded here. First, loyalty to a brand means its customers are more willing to accept a price rise as an occasional adjustment by a strong and favoured brand, and are willing to pay a higher price for the brand they better appreciate and cherish. Second, enduring commitment to a brand suggests that its customers are likely to make greater efforts to hold to it through harsh times. The problem is that price differentials are more difficult to maintain through inflation, as prices change more quickly and thus the premiums that signal higher brand equity can quickly lose their efficacy in consumers’ minds. Loyal customers are expected to forgive the strong brand for continuous price hikes yet they are gradually likely to fail making sense of the “price premiums” it commands. An unstable inflationary process poses more complex challenges even to strong brands, and customer loyalty may not provide a sound protection from inflation.

Brands offer several advantages to consumers. Using brand names as information cues can help simplify and shorten the decision process. Strong brands provide confidence to consumers who are using their products; they may instill a sense of stability and certainty in their daily lives. In addition, brands often are employed as means of self-expression, helping consumers define their self-image and social image. But consumers have also become more demanding, expecting better customer experiences with brands, their products and services. The conditions under which consumers promise their loyalty to brands and companies get tougher, and even loyal customers expect to receive monetary and other rewards. Consumers are becoming better informed through different online media channels and enquire more about prices. The advantages mentioned above to consumers in using strong brands may translate less frequently into willingness to pay large price premiums. International research firm of consumer trending, trendwatching.com, identified earlier this year a trend of “deal-chic” among consumers: Consumers are looking more eagerly for opportunities and deals not just to save money but out of the thrill of pursuit, need for control, and the perceived smartness that goes with finding the best deals. It is about changing attitudes towards deals and discounts that is fueled by expanding sources of information online and the immediacy of information (e.g., by using mobile devices) which may consequently lead to the squeezing of strong brands. In recent years brands have entered more testing times and the implications of new tendencies in consumer behaviour are yet not fully revealled.

The positive approach of the investment experts to invest in companies that manage strong brands of the more frequently and regularly used consumer products is difficult to dispute and is overall commendable. The emphasis has to be on investment for the long run, trusting those companies and their brands to build-up high returns through time. This approach can be justified by the extent to which their products are rooted in consumers’ day-to-day lives, their longevity, and foremost the usually high-skilled level of marketing and brand management. They should be allowed the time, however, to come out and recuperate from either rough economic times that affect everyone or hardship and crises that specifically hit a given company before they get back on track. It is also important to keep in mind the changing and intensifying challenges that strong brands are facing, challenges that may require more patience and loyalty from investors.

Ron Ventura, Ph.D. (Marketing)


“Bet on the Brands”, Scott Cendrowski, 2012, Fortune (European Edition), Volume 166, Number 1 (2 July), pp. 60-65.

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