P&G Grooming | Gillette

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Gillette is the core brand within Procter & Gamble's grooming business unit. It has long reigned as the world's biggest shaving and razor business, with an estimated 65% share of the global market, and a dominant position in both the men's and women's segments. Yet the brand has been under intense pressure since the end of the 1990s, first from difficult economic conditions, later as a result of increased competition from arch-rival Schick Wilkinson Sword (now owned by Edgewell Personal Care). The Gillette Company was acquired by P&G in 2005, along with subsidiary brands such as Braun shavers, and performance has stabilised, with sub-brands such as Gillette Fusion and Venus for women established as billion-dollar brands in their own right. However, the company continues to feel pressure from lower-priced rivals and from a changing market where daily facial shaving is considered less important than it once was. At the same time there is a growing demand among men for body shaving products, an area where Gillette remains comparatively weak.

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Adbrands Company Profiles provide a detailed analysis of the history and current operations of leading advertisers, agencies and brands worldwide, and include a critical summary which identifies key strengths and weaknesses. Adbrands Account Assignments tracks account management for the world's leading brands and companies, including details of which advertising agency handles which accounts in which countries for major markets. Subscribers may access the following website links:

Gillette website

Brands

Mach-3 Venus
Braun Fusion

Parent

Procter & Gamble

Recent stories from Adbrands Weekly Update:

Adbrands Weekly Update 24th Aug 2016: You can always tell when the pressure is mounting: that's when the lawsuits kick off. P&G's Gillette division has issued a suit against main shaving rival Edgewell Personal Care, makers of Schick and Wilkinson Sword, citing "deceptive acts and practices, false advertising, unfair competition and patent infringement". Specifically, P&G is unhappy about claims that a new line of private label razor blades produced by Edgewell for retailers give a "shave as good or better" as Gillette's three-bladed Mach 3 design. The blades are designed to be compatible with Mach 3 razor handles. The filing requests that Edgewell's blades be withdrawn from retailers' shelves. It's Gillette's third suit against rivals in eight months. It is also suing Dollar Shave Club (now being acquired by Unilever) for patent infringement; and four former Gillette employees who joined start-up ShaveLogic for breach of contract and sharing trade secrets. According to Euromonitor, Gillette's share of the US shaving market has fallen from 71% in 2010 to 59% last year. The market itself is also in decline as a result of the popularity of hipster beards. Edgewell's share has fallen too in that time, from 13% to 11%, while private label doubled to 6%. New entrant Dollar Shave Club has carved out around 5%.

Adbrands Weekly Update 14th Jul 2016: Ads of the Week: "Perfect Isn't Pretty". P&G launched a big Olympics push for Gillette this week, with this extended film from Grey New York. It's an all-star athlete line-up, with specially commissioned musical backing from Sia. As the slogan "Perfect Isn't Pretty" suggests, the ad dispenses with the usual gloss employed in sports endorsement campaigns, depicting instead the gruelling training regimes these guys put themselves through: a painful, solitary, family-unfriendly slog. The sequences a re all very convincing (with only the inevitable shaving scenes looking even remotely staged). Nice work.

Adbrands Weekly Update 15th Oct 2015: Ads of the Week "Bond Moments". Those Bond ads are coming thick and fast now. Grey's new spot for Gillette spent all its cash on lavish setups, excellent stunts and gorgeous photography, so there was nothing left for any actors from the movie, not even supporting cast. That guy playing Bond - whoever he is - is too much of a mannequin to rival Daniel Craig (or even heaven help us Roger Moore), but the individual sequences are fantastic. Is this a case of director Adam Berg making his pitch to take over from Sam Mendes for the next Bond perhaps?

Adbrands Weekly Update 1st May 2014: Procter & Gamble launched the latest premium variant for its Gillette razor business in a bid to reignite the brand's slowing growth. The Fusion ProGlide Flexball is designed to respond even better to the contour's of the user's face, and comes in both manual and battery-operated versions, priced at $11.49 and $12.59 respectively. However some analysts expressed doubts over whether premiumisation is the best strategy for the US razors and blades market, which appears to be shifting more firmly towards lower-priced products.

Adbrands Weekly Update 12th Dec 2013: Adweek handed its top prize for Global Agency of the Year to Grey for a spectacular new business run in which Gillette was the shiniest jewel.


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Background

Free for all users | see full profile for current activities: In the closing years of the 19th century, a salesman named King Camp Gillette spent six years searching unsuccessfully for a backer for his idea for a disposable razor blade that would save its users the time and trouble of having their normal razors regularly stropped and sharpened. The main obstacle was to find a way of producing wafer-thin slivers of sharpened steel that were strong enough to cut hair but so cheap that they could be thrown away after use. Finally in 1901 Gillette came across inventor and engineer William Nickerson, who was able to design the necessary process. The American Safety Razor Company was founded the same year, becoming The Gillette Safety Razor Company a year later. It was another two years before the first razor reached the market, but the product was an immediate success. The company moved overseas quickly, establishing a London office and Paris factory in 1905. By 1923, almost a third of sales came from outside the US.

In 1918, a contract with the US Army led to the bulk sale of 3.5m razors and 36m blades to soldiers, and arguably killed off the traditional barber shop shave for good. Gillette always had an eye for unusual marketing opportunities. The company sold its razors through banks during the 1920s ("Save and Shave!"), and teamed up with Wrigley's Gum for joint promotions. It launched its celebrated Blue Blade in 1934. After Word War II, Gillette began to diversify, acquiring Toni hairstyling kits in 1948 and Papermate pens seven years later. The company launched its Foamy shaving cream in 1953. A series of other purchases followed, including Right Guard toiletries and Cricket lighters.

Braun electric appliances was Gillette's first international purchase. It had been founded in Germany in the 1920s to make radios and eventually record players. It diversified into other appliances after World War II but only established an international reputation with the introduction of low-cost electric shavers during the early 1960s. It was acquired by Gillette in 1967 for around $68m in cash and stock. This was followed by Liquid Paper (1979), and finally leading US toothbrush maker Oral-B in 1984. That company had been founded by a Californian dentist in 1950 to make specialist manual toothbrushes, but it provided Gillette with a useful springboard to establish a US base for a Braun design for an electrically powered toothbrush.

Gillette fought off two takeover bids in the late 1980s, including one from Revlon, and refined its strategy of being the market leader in each segment it occupied. Further acquisitions included Waterman (1987), Parker Pens (1993) and ThermoScan thermometers (1995). In 1996, Gillette paid $7.1bn to acquire Duracell, the world leader in alkaline batteries. That brand was launched in the 1960s by the PR Mallory Company, which mainly specialised in what were then called mercury cell batteries, which were more reliable than traditional zinc carbon batteries, but were mainly produced for industrial and military use. It was something a pioneer in battery design, responsible for developing the modern AA and AAA battery formats during the 1950s. The Duracell brand was introduced in 1964, but the costs of producing alkaline batteries remained high and the company remained under intense pressure from better established producers. In the 1970s the business passed back and forwards between several buyers, becoming a unit of Kraft Foods during the 1970s. Mallory adopted Duracell as its corporate title in 1985, and was sold to buyout specialists Kohlberg Kravis Roberts in 1988. They floated it in 1991, before selling out to Gillette five years later, to bolster the company's own rechargeable battery technology.

Gillette was by this time heavily involved in complicated technological design and development. Throughout the 1960s and 1970s, it had been famed for its breakthroughs in shaving technology. The company invented the first system razor, the Techmatic, in 1967, so that users no longer needed to handle the actual razor blade. The GII, launched in 1971, introduced twin-blade shaving, followed by the Contour in 1984, the Sensor in 1991, which was the first razor to feature spring-mounted blades, and the Sensor Excel in 1994. However the company was becoming increasingly bogged down in product development. The Sensor was first developed in the UK in 1979, but Gillette spent more than 10 years and $150m on research before launching it commercially. The Mach 3 project was even more expensive. By the 1990s, as growth slowed, Gillette's critics were beginning to argue that these years of painstaking research simply allowed innovative competitors to leap in and grab niches in the market. After 18 months of profit warnings and disappointing performance, Gillette's chairman and chief executive Michael Hawley was ousted by the board in October 2000. A few weeks later the company launched Venus, its new shaver for women. It had already invested $300m in developing the product, and went on to spend another $150m on marketing.

In early 2001 the group sold off its entire stationery products division to Newell Rubbermaid, including the Paper Mate, Parker and Waterman pen brands and Liquid Paper correction fluid, following a catastrophic fall in profitability. Gillette finally found a replacement for Hawley in February 2001. James Kilts, former chief executive of Nabisco Holdings was appointed, the first time an outsider had been chosen to lead the company. He quickly began a further restructuring of the group designed to improve its competitive position. Having restored the company to growth he renewed his reputation for negotiating a good deal by agreeing to sell Gillette to Procter & Gamble for a handsome $54m, more than five times annual sales. See full profile for current activities


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