Gillette's Restructuring in India|Business Strategy|Case Study|Case Studies

Gillette's Restructuring in India

            
 
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Case Details:

Case Code : BSTR129
Case Length : 15 Pages
Period : 1984-2004
Organization : Gillette India Ltd.
Pub Date : 2004
Teaching Note : Available
Countries : India
Industry : Consumer Products

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This case study was compiled from published sources, and is intended to be used as a basis for class discussion. It is not intended to illustrate either effective or ineffective handling of a management situation. Nor is it a primary information source.



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EXCERPTS

Segmentwise Information

Grooming

In 1986, the Indian razor blade market was valued at Rs 2 billion. As per figures provided by GIL, the total razor blade market in India in 2003 was Rs 6 billion by value and 3.8 billion units by volume. India is the world's largest market for Gillette in terms of volumes. The double-edge segment formed 97 per cent of the Rs 6 billion Indian blade market.

Half of this came from salon usage. Eighty per cent of Indian consumers used double-edged blades. However, the growth in value share of twin blades from three per cent of the total value (Rs 60 million) in 1986 to 28 per cent (Rs 1.68 billion) in 2003 showed that twin blades had made considerable inroads into the Indian market. Systems and disposables accounted for three per cent of the Rs 6 billion market. The triple blade segment, a segment charting growth, occupied two per cent of the market. In value terms, in 2003, double-edged blades comprised 78%, systems 15% and disposables 7%. As per AC Nielsen/ORG's estimates, the domestic shaving preparations market in 2003 was pegged at Rs 1.5 billion...

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Restructuring

In the mid 1990s, Gillette went into an acquisition mode to grow in the Indian market. It made two acquisitions in 1998 -- the oral care division of Parle and Geep non-alkaline batteries from the Geep Industrial Syndicate. Oral B was launched in India in the year 1996 and was targeted at the upper segment of the market.

The oral care business was showing faster growth and therefore the company began exploring ways to increase its presence in the urban and rural market. The Indian arm of Gillette also felt the need to align its operating practices with global practices. Globally, Gillette had a two-brand strategy in the oral care segment. In 1998, Gillette acquired the Prudent brand from Parle. Customers had certain perceptions about the Prudent brand, which Gillette had to change. Prudent was known as a paste/mouthwash brand rather than a toothbrush brand. Parle had repeatedly repositioned Prudent, creating confusion in consumers' minds. Gillette revamped the entire product range by totally changing the package to make it look more contemporary...

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