PDM CASE STUDY-1
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Development of Products and Services for Global
Markets
SUBMITTED TO
: Prof. Marco Nina
Q1.
When Gillette entered the Indian market in 1984, it sold the same domestic
product in packaging customized to the local market (language, colour, and style
preferences). What benefits would there have been for Gillette to customize its
product only minimally in this way
?
In 1900, King C. Gillette had a great idea to create a disposable blade that was thin and
strong. Further in 1971: Gillette was growing strong in the United States. In 1984, The
company: Gillette entered the Indian Market with its Mach 3 series with local Indian style
packaging. Analysing the Indian market, the Gillette company targeted the professional
men’s who earns more than average disposable Income. After studying an Indian market to
an extent, the company came to an point that Indian men’s use only double-edges razor;
which is century old technology, because it was more economical. The Company targeted the Indian market in a way called as ‘Localization’
, which means
customizing the product according to the consumption in India. To some extend the
company: Gillette had also gained some benefits from the Indian market. Firstly, we can say
the company uses 80 percent less parts in there manufacturing than they use material in
best-selling razors. From this way the company start saving more by reducing production
cost. Secondly, company started manufacturing plastic razors which are cheap to
manufacture and in this way manufacturing cost become less. Single blade razors were
made for Indian market, which saves more for company. Stablishing entire manufacturing
unit to India, the company: Gillette would able to reduce the manufacturing cost by opting
smart marketing Strategic.
Gillette reaped various benefits from selling the same home product with minimum package
customization when it first entered the Indian market in 1984.
Cost-effectiveness
: By standardizing the product, Gillette was able to take advantage of
economies of scale and cost savings linked to a dependable production process.
Operational Simplicity
: The supply chain was made simpler with less customization, which
made inventory management and distribution easier. Global Brand Image:
A robust and unified global brand image was largely attributed to the
maintenance of a consistent product worldwide. Because of its well-known brand worldwide,
consumers could have faith in it.
Time Efficiency:
By avoiding significant product adaption, Gillette was able to enter the
Indian market quickly and make a name for itself.
Leveraging Global Success
: Gillette was able to leverage a successful recipe for success
in overseas markets by capitalizing on the success of its native product.
Continuity in Brand Communication
: A unified and consistent brand message might be
used in various markets thanks to a consistent product. Streamlined Marketing Efforts:
Gillette's ability to repurpose materials and campaigns
worldwide reduced the requirement for market-specific promotional content, resulting in a
streamlined marketing approach.
Faster Consumer Adaptation:
Because the product was more or less identical to what
consumers were already familiar with around the world, minimal customization helped to
accelerate consumer acceptance.
Even while these benefits are noteworthy, it's important to understand that customer tastes
might differ greatly throughout cultures. The case study also emphasizes P&G's subsequent
adoption of a more comprehensive localization plan in India, highlighting the significance of
market adaptation for long-term success.
Q2 What were the three major cultural preferences that P&G found required attention?
Explain how each cultural preference was addressed.
Shaving Habits and Practices:
Problem: Indian men were shaving while sitting on the floor
with a mirror in hand, using double-edged razors that were 100 years old. This resulted in
cuts and nicks. They also went longer between shaves and showed an indifferent attitude
towards shaving. Taking Care of Business: In 2009, P&G sent out a diversified team to perform in-depth
market research in order to better understand the unique routines and habits of Indian
males. This prompted the development of the Gillette Guard razor, which was made to help
Indian men with their shaving needs by making the shaving experience more comfortable
and effective.
Cost Sensitivity and Affordability:
Problem: Indian customers had low tolerance for price,
and they thought Gillette's current line of goods was too costly for the market. A sizable
prospective market of Indian men in general needs reasonably priced shaving products.
Distribution and Accessibility:
Problem: The conventional "glocalization" distribution
model, which concentrated on strong retailers, did not work well in India. Moreover, shaving
was impeded in Indian houses by the absence of running water, thus shaving supplies had
to be easily available to all.
Taking Care of Strategy:
In order to drastically cut expenses, P&G adopted a "reverse
innovation" approach, streamlining product design and moving production to India. To appeal
to the cost-sensitive Indian market, Gillette Guard was introduced at a reasonable price point
(about USD 0.30 for each razor and USD 0.10 for each blade).
Approaching Strategy
: P&G changed how it distributed its products, utilizing India's
network of neighbourhood stores, or kerana’s, to make the Gillette Guard easily accessible
to everybody. To alter cultural preconceptions and broaden the product's accessibility, a
marketing campaign starring Bollywood actors was combined with the shift in distribution
methods.
To sum up, P&G took into account the cultural preferences in India by developing Gillette
Guard, a product that matched the unique shaving habits of the market, keeping it
reasonably priced for price-conscious consumers, and guaranteeing accessibility through a
change in distribution.
Q3 Having found success in the Indian market through localization, what should
P&G’s next steps be in India and internationally?
In India:
Ongoing Market Research: Pay attention to changing customer tastes and cultural
developments in the Indian market. P&G will be able to recognize new opportunities and
modify its strategies with the support of regular market research.
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Share of
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Loyalty
(%)
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Purchase
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Rate
Penetration
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Requirements
(%)
Brand
Share
(%)
(%)
Frequency
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32
71
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6.3
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100
39
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