BIC razors Environmental analysis
...petition, the razor market has been expanded to include various shaving systems and derived products for both men and women. The razor industry operates through types of shaving systems, which also represent three different niche markets: - The disposable razor market - The non-disposable razor market - The electric razor market Our project will primarily focus on the disposable versus the non-disposable razor market. The trends In the past, the three companies who dominated the razor industry used to specialize in one single niche market. The Bic Group specialized in mass producing disposable razors at low cost with little loss of functional quality: “maximum service, minimum price”. Gillette earned its dominant position in the market, especially with men, through large investments in research and development and consumer research, focusing much more on the development of high quality non-disposable razors and captive systems that allowed the consumer to refill blades on a permanent handle. Schick-Wilkinson-Sword, the company which originated the electric razor, has long been Gillette’s most direct market challenger and also manufactured reusable and disposable razors. Disposable razors account for about 70% of the wet-shave market in volume terms, but only 30% of the value. As a result, there was a need to increase profit margins from the disposable razor users. Hence, the recently increased competition in this industry which had not been seen the mid-1970s, when Bic first introduced disposables, sparking a huge catch-up effort by Gillette and some bitter lawsuits. Today, the razor blade industry is evolving very quickly as the wet-shaving products development has become dynamic and competitive. Both Gillette and Schick have realized that they can make more money out of disposable razors hence the relatively recent marketing of the three blade razor system which has allowed the three companies to combine technological efficiency with a competitive pricing strategy to gain more market share. Results show that consumers appear to be going for the three-blade gimmick with Schick gearing up to launch its 4 blade razor later this year. THE PEST ANALYSIS Political/Legal TODAY · Health regulations which influence the design to some extent for safety purposes as well as the warnings on the label FUTURE TREND · A possible regulation on the amount of blades which can be sold in one razor Economic Factors TODAY · The increased price associated with the more expensive non-disposable razor which is currently the trend. FUTURE TREND · The threat of cheaper store brand substitutes which provide cheaper replacement blades for the tree-blade systems Sociocultural Factors TODAY · Grabbing a young market and making shaving with their product a habit before they try the alternate forms of hair removal · Aligning the ability to shave with « a right of passage » for both men and women · Some market segments are “culturally or religiously” excluded. For example: The Sikhs in India, some deep Islamic countries,…, where men wear beards as utterance of their culture or religion and don’t shave wet. FUTURE TREND · Foreseeing coming needs of an aging baby boomer population (safety guard to steady shaky hands) · Possible future new fashion trends where “daily shaving” will be “out” for men and they leave a tree-day beard that you can’t maintain with a blade razor. Technological Factos TODAY · The money spent on R&D by the Market Leade...