blue ocean strategy Noncustomer Exercise
Life in the 1900s
Life in the 1900s
Life in the 1900s
Life in the 1900s
Shaving in the 1900s
Shaving in the 1900s
Shaving in the 1900 s
Shaving in the 1900 s
Shaving in the 1900s
Shaving in the 1900 s
Shaving in the 1900s Obtained with permission from Roy Export Company Establishment
Shaving in the 1900s Obtained with permission from Roy Export Company Establishment
Who are the existing customers of the industry
Who are the existing customers of the industry Medium/high income
Who are the existing customers of the industry Medium/high income White collar workers
Who are the existing customers of the industry Medium/high income White collar workers Barbers
What are the key competing factors of the industry?
What are the key competing factors of the industry? Life lasting razors
What are the key competing factors of the industry? Life lasting razors Forged blades
What are the key competing factors of the industry? Life lasting razors Forged blades Size of blade
What are the key competing factors of the industry? Life lasting razors Forged blades Size of blade Price of razor
Who are the noncustomers?
Who are the noncustomers? Occasional shavers
Who are the noncustomers? Occasional shavers Low income
Who are the noncustomers? Occasional shavers Low income Women
The Three Tiers of Noncustomers Shaving Market
The Three Tiers of Noncustomers Shaving Market 1st Tier Noncustomers: occasional shavers
The Three Tiers of Noncustomers Shaving Market 1st Tier Noncustomers: occasional shavers 2 nd Tier Noncustomers: low income
The Three Tiers of Noncustomers Shaving Market 1st Tier Noncustomers: occasional shavers 2 nd Tier Noncustomers: low income 3 rd Tier Noncustomers: women
Shaving was not yet a common habit
Shaving was not yet a common habit Many people found it a hassle to shave
In 1900, less than 26 million people lived in metropolitan cities where there were barbershops
1 st Tier: Occasional Shavers The remaining 66 million lived in nonmetropolitan territory and could not easily go to the barbershop
2 nd Tier: Low Income 40% of total population had low incomes
2 nd Tier: Low Income 40% of total population had low incomes 2 million people unemployed
2 nd Tier: Low Income 40% of total population had low incomes 2 million people unemployed 30 million below the poverty level
3 rd Tier: Women 37 million (49%)
3 rd Tier: Women 37 million (49%) 12 million between 20 39
3 rd Tier: Women 37 million (49%) 12 million between 20 39 Can they realistically go to the barbershop?
What are the factors that kept them from shaving?
What are the factors that kept them from shaving? Price
What are the factors that kept them from shaving? Price Safety
What are the factors that kept them from shaving? Price Safety Ease of use
What are the factors that kept them from shaving? Price Safety Ease of use Maintenance free
What are the factors that kept them from shaving? Price Safety Ease of use Maintenance free Fashion and image
Acting on our understanding of noncustomers ERRC Grid Eliminate Raise Reduce Create
Acting on our understanding of noncustomers ERRC Grid Eliminate Raise Life lasting razors Forged blade Reduce Create
Acting on our understanding of noncustomers ERRC Grid Eliminate Raise Life lasting razors Forged blade Reduce Create Size of blade Price
Acting on our understanding of noncustomers ERRC Grid Eliminate Life lasting razors Forged blade Raise Safety Ease of use Reduce Create Size of blade Price
Acting on our understanding of noncustomers ERRC Grid Eliminate Life lasting razors Forged blade Raise Safety Ease of use Reduce Size of blade Price Create Maintenance free Fashion & image
Gillette s Safety Razor
Gillette s strategic move In 1903 Gillette invented a safety razor with disposable blades
Gillette s strategic move In 1903 Gillette invented a safety razor with disposable blades The razor required a small initial investment
Gillette s strategic move In 1903 Gillette invented a safety razor with disposable blades The razor required a small initial investment Gillette changed the business model of the industry
Gillette s strategic move FROM FROM TO
Gillette s strategic move FROM High priced razor FROM TO Low priced razor
Gillette s strategic move FROM High priced razor Forged blade FROM TO Low priced razor Stamped steel blade
Gillette s strategic move FROM High priced razor Forged blade Thick and wide blade FROM TO Low priced razor Stamped steel blade Narrow and thin blade
Gillette s strategic move FROM High priced razor Forged blade Thick and wide blade Unsafe FROM TO Low priced razor Stamped steel blade Narrow and thin blade Safe
Gillette s strategic move FROM FROM TO
Gillette s strategic move FROM Difficult FROM TO Easy
Gillette s strategic move FROM Difficult FROM TO Easy Complex honing and stropping process Disposable blade
Gillette s strategic move FROM Difficult FROM TO Easy Complex honing and stropping process Disposable blade Unfashionable Fashionable
Strategy canvas High Low
Strategy canvas High Straight Razor Low
Strategy canvas High Gillette s Safety Razor Straight Razor Low
Strategy canvas High Eliminate Gillette s Safety Razor Straight Razor Low
Strategy canvas High Eliminate Reduce Gillette s Safety Razor Straight Razor Low
Strategy canvas High Eliminate Reduce Raise Gillette s Safety Razor Straight Razor Low
Strategy canvas High Eliminate Reduce Raise Create Gillette s Safety Razor Straight Razor Low
Breaking the value cost trade off
Breaking the value cost trade off Life lasting razors Forged blade Size of blade Cost savings Low cost
Breaking the value cost trade off Life lasting razors Forged blade Size of blade Safety Ease of use Maintenancefree Fashion & image Cost savings Low cost Differentiation
Breaking the value cost trade off Life lasting razors Forged blade Size of blade Safety Ease of use Maintenancefree Fashion & image Low pricing Cost savings Low cost Differentiation
Breaking the value cost trade off Life lasting razors Forged blade Size of blade Safety Ease of use Maintenancefree Fashion& image Low pricing Cost savings Low cost Differentiation High volume Attracting the mass
Breaking the value cost trade off Life lasting razors Forged blade Size of blade Safety Ease of Use Maintenancefree Fashion& Image Low pricing Cost savings Low cost Create a blue ocean Differentiation High volume Attracting the mass
Breaking the value cost trade off Life lasting razors Forged blade Size of blade Safety Ease of use Maintenancefree Fashion& image Low pricing Cost savings Low cost Create a blue ocean Differentiation Replacement of blades sales High volume High profitable growth Attracting the mass
Annual sales, Blades millions 6 5 4 3 2 1 0 1903 1905 1907 1909 1911 1913 1915
Annual sales, Blades millions 6 6m 5 4 3 3m 3.4m 2 1 0 1.1m 847,400 14 98,909 1903 1905 1907 1909 1911 1913 1915
Annual sales, Razors thousands 450 400 350 300 250 200 150 100 50 0 1903 1905 1907 1909 1911 1913 1915
Annual sales, Razors thousands 450 400 385,806 444,294 451,861 350 397,504 300 276,577 250 200 266,346 150 100 50 0 51 1903 1905 1907 1909 1911 1913 1915
Gillette s strategic move
Gillette s strategic move
Gillette s strategic move
Increasing the size of its blue ocean In the 1910s, hair removal for women started to become fashionable
Increasing the size of its blue ocean In the 1910s, hair removal for women started to become fashionable Lengths of skirts and dresses reduced
Increasing the size of its blue ocean In the 1910s, hair removal for women started to become fashionable Lengths of skirts and dresses reduced This triggered Gillette to introduce the Milady Décolletée
Gillette s strategic move
Increasing the size of its blue ocean During WWI, soldiers needed to be clean shaven in order to fit the gas mask properly
Increasing the size of its blue ocean During WWI, soldiers needed to be clean shaven in order to fit the gas mask properly It became imperative for them to shave
Increasing the size of its blue ocean During WWI, soldiers needed to be clean shaven in order to fit the gas mask properly It became imperative for them to shave Gillette partnered with the US army, selling 3.5m razors and 32m blades
Increasing the size of its blue ocean During WWI, soldiers needed to be clean shaven in order to fit the gas mask properly It became imperative for them to shave Gillette partnered with the US army, selling 3.5m razors and 32m blades When they returned home they were heroes. It became fashionable to be clean shaven.
Annual sales, Blades million 17 6 5 4 3 3m 3.4m 6m 2 1 0 1.1m 847,400 98,909 14 1903 1905 1907 1909 1911 1913 1915
Annual sales, Blades million 17 17m 6 5 4 3 3m 3.4m 6m 2 1 0 1.1m 847,400 98,909 14 1903 1905 1907 1909 1911 1913 1915
Annual sales, Razors thousands 2000 1800 1600 1400 1200 1000 800 600 400 200 50 397,504 444,294 276,577 266,346 451,861 385,806 1903 1905 1907 1909 1911 1913 1915 1917 1919
Annual sales, Razors thousands 2000 2.3m 1800 1600 1400 1200 1000 800 397,504 600 444,294 276,577 266,346 451,861 400 385,806 200 50 1903 1905 1907 1909 1911 1913 1915 1917 1919
Shaving Trivia: Origins of the barber pole Before 1745, barbers also performed surgery
Shaving Trivia: Origins of the barber pole Before 1745, barbers also performed surgery Bloodletting was a popular medical practice
Shaving Trivia: Origins of the barber pole Before 1745, barbers also performed surgery Bloodletting was a popular medical practice The spiraling red and white stripes symbolized blood and bandages