This study is about the information of Gillette instance analysis and alternate referral selling scheme. Gillette razor blade successfully entered the Indonesia market. Although Indonesia market shows astonishing growing potency, nevertheless there is ferocious competition. To increase the demand for razors, Gillette needs to analysis Indonesia market and utilizing a assortment of gross revenues scheme and selling scheme. Gillette ‘s attack is “ Think planetary, Act local ” . Shavers of the Indonesia market are still developing compared to Western markets. 60 % of people use a knife to shave in Indonesia. Therefore, in order to utilize razor blade for them, Gillette needs to explicate the advantages of a razor blade.
Indonesia ‘s per capita income has steadily increased during the past 20 old ages. Economy had grown approximately 7 % and there are 196 million populations. Indonesia is a immense and really of import market in the Asia-Pacific part. In order to increase market portion, there are some challenges.
84.1 % of the Indonesian people earn less than $ 10,000
Peoples who do non utilize the razor blade to be used razors – Until 1995, five old ages due to the turning figure of people to shave gross revenues growing of 9 %
Make low-income people will be able to utilize a disposable
Increase figure of incidence to utilize double-edged or disposable to people who used to shave
Indonesian ordinances do non let to foreign company direct importation or administering their merchandises
Sell more expensive high-end merchandises to people who are utilizing double-edged or disposable – Strengthen its place in Southeast Asia due to the gross revenues of high-end household
Set better distribution and development of the supermarket channel for the long-run growing
Shaving increase the figure for promotion
Make advertizement to pull the Indonesian adult females to utilize Gillette merchandises
II. Analysis
A. Situation Analysis
Gillette was the universe leader in blades, razors and nine other consumer merchandises classs. Now the Gillette name is synonymous with razor blades.
Gillette Indonesia started with bulk ownership in a joint venture with a local company in 1971. They built automated fabrication works with 68 full- clip and 75 insouciant workers. They had grown 9 % of gross revenues, 17 % of net income and 18 % of net incomes per portion between 1990 and 1995. They produced 150 million blades and exported 46 million bring forthing $ 23 million in gross revenues in 1995.
Gillette merchandises line ( Exhibit 2 )
1. Doubled Edge Blades
2. Disposable Blades
3. System Blades
Gillette Indonesia Gross saless Dislocations: 1995 and 1996
Gillette Indonesia Gross saless dislocation
1995
1996 ( 1000000s )
1996 Growth
Shaving merchandises entire gross revenues
$ 19.6
$ 27.6
40.8 %
Blades
$ 10.3
$ 11.2
9 %
Disposable
$ 1.2
$ 2.5
108 %
Detector
$ 5.6
$ 10.4
87.51 %
Razors
$ 2.0
$ 3.0
50 %
Homework Merchandises
$ 0.5
$ 0.5
0 %
Non-Shave merchandises
$ 2.0
$ 2.3
15 %
B. Market Analysis
Indonesia is an archipelago of more than 15,000 islands and 196 million populations. They speak more than over 250 linguistic communications. The 35 % of population life in metropoliss and rest 65 % lives in rural countries. Four major urban metropoliss in Indonesia are Jakarta, Bandung, Surabaya, and Semarang. All of them are situated in the island of Java.
40 million Indonesian grownup work forces shave about 5.5 times per month, comparison with 12 times per month in Hong Kong, 26 times per month in the United States.
More than twenty old ages, Indonesia averaged an one-year gross domestic merchandise growing rate of over 7 % .
From 1998, the five-year economic development plan growing in non-oil related industries.
75 % of the GDP produced in Java and Bali accounted for merely 60 % of the population.
84.1 % of the people earn an income less than $ 10,000. Then Forty per centum of shaving work forces used boughten blades all or portion of the clip. Stay 60 % of the people used dry or wet knives.
20 % people uses 15 blades per twelvemonth and occasional user usage four blades per twelvemonth. 4 % of shaving people used froth for lotion ; 25 % used soap or H2O, 12 % used H2O entirely and rest 58 % shaved dry.
C. Rivals
The chief rival merchandises are low-end, imported double-edge blades from Eastern Europe and China. In razor blades market, chief rivals are Tatra, Super Nacet and Tiger.
Those merchandises are four times cheaper than Gillette merchandises. Lower income clients were purchasing their merchandises. However, people will travel to Gillette merchandises thanks to the increased incomes.
In disposable market, BIC and Bagus were chief rivals. However, Gillette has 90 % of the premium section of the market.
III. SWOT Analysis
Internal Strengths
90 % of market portion for premium-priced disposable
48 % of market portion for blades
Assortment of merchandise line to toilet articless, cosmetics and place contraptions.
R & A ; D activities for merchandises development
Good production line and global degree selling channels
Different merchandises to aim different section
Highly automated fabrication works
Strong consumer consciousness in high-quality blades ( Exhibit 5 )
Failings
A few figure of professional people with the local market – differences with global market and local market
Cultural differences
Hard to cognize that rivals ‘ moves
23 of distributers – distribution issues limited channels, weak communicating webs, hapless traffic conditions and engineering
Gross saless squad merely focused on the instruction of distributers and gross revenues people do non specify new gross revenues scheme
Limited fabrication capacity
Emphasis planetary selling
Opportunities
196 million populations
Strongly turning economic system – mean one-year Gross Domestic Product groth of over 7 % for more than 20 old ages
Increasing figure of demand for preparing merchandises global – Both work forces and adult females are shaving with a razor blades
Increasing of foreign investing
Increasing of the incidence of shaving
Menaces
Peoples believe that Gillette might be produce six or seven-bladed razor – Peoples do non believe that the figure of the razors is non of import anymore
Competition with other low cost trade names – 1/4 times of the Gillette
Preparing merchandises regard as luxury points
Low figure of incidence of shaving
Turning figure of usage and throw off disposable
Most of the population earn less than $ 10,000
Government prohibit that foreign company from straight importing or administering its merchandises
Archipelago – 15,000 islands and 250 linguistic communications
Different civilization and faith
IV. Selling Scheme
Marketing aims
Increase incursion of the current market
Increase market of razor blades and maintain net income growing
Change the trade name consciousness to existent purchases.
Focus on supermarkets
Increase 25~30 % in expected gross revenues for 1996
Merchandises
Gillette is a planetary razor blade leader. However, develop to Indonesian razor market, Gillette need to supply four different merchandises:
Double-edge blades: Gillette Goal Red ( 97 Awareness ) and Gillette Goal Blue. These merchandises are less expensive merchandises.
Disposables: Goal II.
Systems: GII system. This is the merchandise for people with high income
Merchandises Target
Double border: Over 18, low income ( less than $ 5,000 )
Disposables: Over 18, average income ( between $ 5,000 ~ $ 10,000 )
Systems blade: Over 18, medium- high income ( more than $ 5,000 ) .
Target Market
University pupils and office workers – They are trendsetters
Target in the large urban countries where there is possible growing
Advertisement scheme
Educating people how to shave and utilizing shave homeworks.
Advertise by trendsetters increase consciousness of the trade name
To increase the incidence ‘ of shaving times per month
Advertise in universities, supermarket and other chief topographic points
Advertise on Television, wireless, newspaper and cyberspace
Upload their shave film to Youtube or other SNS