Answer Happy

Meeting India's Needs Through Reverse Innovation A Historical Breakthrough In 1900, King C. Gillette had the revolutionary idea to create a disposable blade that was very thin and very strong. The concept of an inexpensive disposable blade made of stamped steel seemed unbelievable at the time, yet by 1901 he had proven disbelievers wrong. The Boston-based business person founded Gillette that year; he passed away in 1932 after growing the company, eventually selling le to a fellow director, John Joyce. Fast forward to 1971- Gilete was still going strong and producing the first twin blade shaving system, the Trac Il In 2005, the company was purchased by Procter & Gamble Co. (P&G, an American multinational consumer goods company, for over USD 50 billion in the largest acquisition in its history. Today, Galette is the leading men's razor brand, with 80 percent of US market share. Gillette's most popular razor, the triple-blade Mach 3, with diamond-like coating blades, Power Glide smoothness, ergonomic handles and pivoting precision heads, is sold internationally as a mid-tier product. In 1984, while it was still operating as Gillette, the company entered the Indian market with the Mach 3 in local packaging targeting professional men with higher than average disposable incomes. The Mach 3 promised a close shave done quickly and with less irritation than other razors, and its promotional materials and distribution models all supported that promise. This value proposition worked well in developed countries, with P&G offering the same as in different packaging. In India, however, despite market presence for over twenty years, the company was unable to gain dominant market share Market Research In 2009, deciding to address weak sales in India, P&G senta diverse team to get a closer look at how Indian men shave. In the 2011 P&G Annual Report one member of the team, Graham Simms, Male Grooming Research and Development, describes how the team conducted thousands of interviews, home visits and shop alongs to gain a strong understanding of the habits and routines surrounding shaving in India. At the time, the average Indian man was shaving with a double-edged razot, a century old technology, because it was a more affordable option. Since the average Indian man represents half a billion potential customers, this was a significant cultural preference that needed to be taken into consideration Graham goes on to say the team discovered indianmen were shaving with a double-edged razor while sitting on the floor, in low light and holding a mirror in one hand. This resulted in many nicks and cuts and an uncomfortable, time-consuming shaving experience. In addition, the lack of running water in their homes meant the men had to go outside to a community water source and pour water into a bowl to carry back to their houses to rinse the blades. Lastly, the team found that indian men had an indifferent attitude to shaving and went longer between shaves than their U.S. counterparts. It was something they could do to feel good about themselves, but they weren't willing to pay a premium for it, even if they could afford to Localization Previously, Gillette and P&G had employed the localization model of international trade, taking a domestic product and doing the minimum to customize it to each international market. This could include using locally targeted packaging or making only slight modifications in manufacturing, both common practices for large companies expanding into new markets. In order to address its market
Localisation Previously, Gillette and PRG had employed the location model of international trading domestic product and doing the minimum to customize it to each intentional market. This could include using locally targeted packapre ar making only slight modifications in manufacturing both Common practices for large companies expanding into new markets. In order to address market challenges in India, P&G decided to start from the beginning and produce a model that would directly meet the expressed needs of the Indian market cost, safety and ease of use. This method of holy customising to start market is known as localization and becoming populer international customers become more discerning with their disposable income Through this process, the Gillette Guard raror was created. The Guard is the most significant product Launch since the creation of the Gillette brand. Its percent.fower parts than the begons and consists of plastic housing a single blade, a safety come to reduce nicks and cuts who having longer har, easy rinse cartridges to minimize use of water, an ergonomic ribbed handi forse and a hanging hole for easy storage when not in use. Moving to a drastically simplified product design, a process catedre innovation, and relocating the entire manufacturing process to India allowed the company to significantly reduce costs and other the product at approximately USD 9.30 per rator and USD 010 per blade when launched in 2011 part of the launch, the company revised its marketing strategy to address the Indian toward sharing and adjusted its business model in the country Rather than focusing on strong relationships with handful of powerful retter. Goods network of local shops, erdiranes, toistribute the newly developed caror making readily everyone everywhere. Itako begana strategic marketing campaign, hiring Bollywood costo represent the company in a series of advertisements showing good looking actors dancing is the street gaining the attention of the town and of an attractive Bollywood actress. The series of ads and the local distribution channels worked together to begin changing indian men's shaving culture, and contributed greatly to the Gillette Guard's success. Today, Indian men prefer the GleeGuard the traditional double-edged razor seven to one and PRG has over 50 percent of the market share in India What's Next? P&G successfully used reverse innovation to become a leader in the Indian market. What is met steps? Some experts suggest the challenge the Gilette brand may eventually tace is a phenomenon called market disruption. This occurs when a domestic or international per registering simple and cheaper option in a well-developed mariut. PSG has chosen ret to alter the Game Guard Inies domestic market for the time being however, it some point in the future another company otter a similar product. This could greatly decrease PSG's long held dominant market share domestically. Potential risks aside, the case of P&G and the Gilette Guard in India is an excelent example of a company focusing on localization of its products and reaping the benefits Learning Outcomes This case study relates to the following learning outcomes from the module Product Development in the Course Products and Services for a Global Market • Describe international trade considerations and the implications when doing dating products for international trade, including market producten research regarding the product incorporate product design considerations and design policy in products to it.com preferences, and to include comparative advantasin international markets • Describe product adaptation and customization, and considerations for use of the
What's Next? PSG successfully used reverse innovation to become a leader in the Indian market. What is met steps? Some experts set the challenge the Gillette brand may eventually face is a phenomenon called "market disruption. This occurs when a domestic or international supplier begins og option in a well-developed market. PaG has chosen tot toote the GetGuard et for the time being however, at some point in the future another company way ofleva product. This could greatly decrease P&G's long held dominantaret share domestically. Potential risks aside the case of P&G and the Gillette Guard in India is an excellent example of a company focusing on localization of its products and reaping the benefits Learning Outcomes This case study relates to the following learning outcomes from the module Product Development course Products and Services for a Global Market • Describe international trade considerations and the implications when developing or adapting products for international trade, including market entry strategies, produce yde and market research regarding the product . Incorporate product design consideration and policy in products to preferences and to include comparative advantages in international matuts • Describe product adaptation and customization and comiderations for each Case Study Questions (20 Markal 1. When Gillette entered the Indian market in 3984, told the same domestic product in packaping customised to the local market language, colour and style preferences What benefits would there have been for Gilette to only mally custom rodiny? Marked 2. What were the three major cultural preferences that P&G found required in? Explain how each cultural preference was addressed is Marks 3. Having lound success in the Indian market through localization, what should PBG.next steps be in India and internationally? (5 Marks) 4. As described in the case study, reverse Innovation can lead to make srutor Whatsteps could P&G take to prevent a decrease of its US market share through the introduction of simple and less expensive razor by its competitors? Marks]