Gillette's Acquisition of Duracell

Procter and Gamble Co. also know as P&G, is an American multinational consumer goods company, founded by William Procter and James Gamble. Its products include cleaning agents and personal care products. It has in its kitty global brands such as Ariel and Tide in the Fabric care segments and Head & Shoulder, Pantene and Rejoice is the Hair care segment. For this case study selects P&G Company as it has an important role in the consumer segment products. As P&G was a popular company, the financials statement shows better performance in the previous year.

Microlite S.A. which is located in Brazil was the largest producer of batteries in South America with a mighty 55% share of the Brazilian battery market. Top Management had decided to shut down all but one out of three of the dry cell battery factories in Guarulhos. This opened up the chance for Luiz Pinto, manager of Microlite's battery factory in Jaboatão, to take over this market share and do further investments in his company.

M international (M) and W Inc (W) decided to enter a long term litigation, due to a patent rights violation. M being the demandant and W the respondent. Not enough information was provided in relation to the charges or the patent.

The case points out that Gillette’s competitors were quick to copy new products. The launch of Sensor will be a breakthrough in the market and will introduce a new product category the “cartridge laser cut razor with superior quality”. Therefore it is essential for Gillette to protect their new product by pursuing patent enforcement, as they already have. This way will Gillette retain its competitive advantage and will re-introduce and position itself as a technology leader.

Market leaders: Duracel and Energizer (80% market share)  adaptation to consumer needs and valuable negotiating power with retailers

Throughout the decade there were numerous customer lawsuits and false advertising and breach of contract.

Colgate-Palmolive Company (CP) launched a new toothbrush, Colgate Precision, to the market. But having developed for three years, CP was fiercely competing with other companies in the market. In order to have the power to fight in the highly competitive market with substantial product activity, Colgate-Palmolive Co. was in a problem of considering the how to position its new product--Precision, and to define the market strategy in terms of positioning, branding, and communication strategy. It provided some options with details to the reader, hence, for such purpose, this case would be a decision case, finding the optimum to segment the new product to the target and how it should be marketed.

A lot of information from different sources was gathered with the purpose of comparing different Li-ion batteries mechanisms, cathode and anode materials, structure and fabrication procedures, and their respective advantages and disadvantages.

Without efficient resource allocation & lack of communication between R&D and Brands, the conflict between departments generated in following steps. Even more, each steps make overall inefficient resource management.

Globally, retailers had seen the rise of Rayovac Company and had started stocking the company’s batteries where, by 2005, 19 of worlds 20 largest retail outlets were stocking Rayovac batteries in their more than a million stores world wide. The company by this time through new acquisitions, research and development had a very wide range of products offer than all its competitors combined. All this globalization strategies were very successful and improved the targeted sales volumes and reduction of cost in production and distribution lines with Rayovac attaining a global outlook that it had intended to achieve within a span of less than 5 years.

New entrants in the industry that are battling to have a share of the market

By all this we can conclude that Gillette was actually consumed by its ambition to earn more revenue through the wrong way. Instead of trying to generate more profits buying other businesses, the Gillette executives should have focused more on the continuous innovation to their own company, because after all it was this continuous innovation and dedication that took Gillette to the top and avoid it to have any serious competition until 1962.

High rivalry from family owned businesses, full line dairies, and large international companies. High threat due to loss of patent; product can be copied by competition and former employees

Globally, 78% of mobile phone users have a smartphone (Close-Up Media, Inc, “Deloitte Report: Mobile Consumers Check Phones over 80 Billion Times a Day Globally.”). Lithium ion batteries, which were introduced by Sony in the early 1990s, are the most common battery to be used in smartphones and other mobile devices due to their high levels of efficiency, their lightweight design, and their ability to be recharged (Hock, “Power Up”). As a result of worldwide demand for lithium ion batteries, mobile technology producers, such as Microsoft and Apple, are dependent on the acquisition of cobalt—a key element in the manufacturing of lithium ion batteries—at the lowest price possible. In their quest for low prices, these companies purchase cobalt from cobalt producers that mine in impoverished areas which lack workplace regulations that ensure safety and fair treatment of laborers. One of the preeminent cobalt suppliers in the world is a Chinese company named Zhejiang Huayou Cobalt, and this firm receives a vast amount of cobalt from a Congo-based subsidiary called Congo DongFang International Mining. A majority of the world’s cobalt, 60%, is mined in the Congo (Frankel, "This Is Where Your Smartphone Battery Begins.").

Because of their similarities, Proctor & Gamble and Gillette are a good strategic fit. Between the two entities they have the ability to combine operations, technology, resources, distribution channels and research costs in efforts to drastically cut spending. With lower costs, and the merger complete, the collaboration of Proctor & Gamble and Gillette should achieve a 1+1=3 effect.