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    Clean Edge Razor

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    Tony Joseph
    This document analyzes Paramount Health and Beauty Company's options for launching a new razor brand called "Clean Edge" in the global razor market. It considers launching Clean Edge as either a niche product or mainstream product. Financial projections show that launching in a niche market targeting social/emotional shavers would result in lower costs from cannibalization and advertising, and higher overall profits after two years. The brand name will be "CLEAN EDGE BY PARAMOUNT" to focus on the product rather than company and help reduce cannibalization of existing Paramount brands.

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    Clean Edge Razor

    Uploaded by

    Tony Joseph
    1K views14 pages
    This document analyzes Paramount Health and Beauty Company's options for launching a new razor brand called "Clean Edge" in the global razor market. It considers launching Clean Edge as either a niche product or mainstream product. Financial projections show that launching in a niche market targeting social/emotional shavers would result in lower costs from cannibalization and advertising, and higher overall profits after two years. The brand name will be "CLEAN EDGE BY PARAMOUNT" to focus on the product rather than company and help reduce cannibalization of existing Paramount brands.

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    Clean edge razor

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    This document analyzes Paramount Health and Beauty Company's options for launching a new razor brand called "Clean Edge" in the global razor market. It considers launching Clean Edge as either a niche product or mainstream product. Financial projections show that launching in a niche market targeting social/emotional shavers would result in lower costs from cannibalization and advertising, and higher overall profits after two years. The brand name will be "CLEAN EDGE BY PARAMOUNT" to focus on the product rather than company and help reduce cannibalization of existing Paramount brands.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    1K views14 pages

    Clean Edge Razor

    Uploaded by

    Tony Joseph
    This document analyzes Paramount Health and Beauty Company's options for launching a new razor brand called "Clean Edge" in the global razor market. It considers launching Clean Edge as either a niche product or mainstream product. Financial projections show that launching in a niche market targeting social/emotional shavers would result in lower costs from cannibalization and advertising, and higher overall profits after two years. The brand name will be "CLEAN EDGE BY PARAMOUNT" to focus on the product rather than company and help reduce cannibalization of existing Paramount brands.

    Copyright:

    © All Rights Reserved
    Download as PPTX, PDF, TXT or read online from Scribd
    Download as pptx, pdf, or txt
    of 14

    CLEANSPLITTING

    EDGE
    RAZOR
    HAIRS IN PRODUCT POSITIONING

    CASE SOLUTION

    BY GROUP C2
    Anubandh 14F112
    Leela Mohit Chivukula 14F129
    Moumita Dutta 14F132
    Sai Alekya Edara 14F147
    Sanjit Kumar Moharana 14F148

    PARAMOUNT HEALTH AND BEAUTY COMPANY


    Global consumer products giant (Health, Cleaning,Beauty and Grooming)
    $13 billion worldwide sales and $7 billion in gross profits.
    Entered non-disposable razor market in 1962 and current revenue- $170
    million, gross profit-$92 million and operating profit-$26 million
    Products(non-disposable razors and refill cartridges)
    Paramount pro in moderate segment and paramount avail in value segment.
    Proposed product in super premium segment Clean Edge which gives
    closest, cleanest and smoothest shave.

    Clean Edge: Attributes and Benefits

    COMPETITORS
    MARKET SHARE ($)

    Brand Categories
    Super-Premium

    Companies

    Prince
    Benet and Klein

    Moderate

    Cogent Plus,
    Cogent
    Vitric Advanced,
    Vitric Master

    Value

    23%

    0%

    PARAMOUNT

    23%

    PRINCE

    BENET AND KLEIN

    1%

    SIMPSON

    Vitric

    22%

    31%

    OTHERS
    RADIANCE

    Simpsons

    Tempest

    Radiance

    Naiv

    Analyzing completion
    Market Share

    NDR Brands

    Volume(%)

    $(%)

    Unit Price($)

    Cogent Plus
    Cogent
    Vitric
    vitric Advanced
    Vitric Master
    Paramount Pro
    Paramount Avail
    Tempest

    1
    22.1
    17.8
    0.7
    0.7
    16.9
    6.4
    0.9

    1.3
    29.4
    20
    1.1
    0.9
    18.5
    4.9
    1.1

    12.5
    11.19
    8.89
    11.2
    10.85
    9.5
    5.75
    10.99

    Naiv(Expected)
    Clean Edge

    2.6

    11.8
    11.19

    Product Features

    Product Benefits

    Super premium products


    Advance lubrication strip,
    non slip handle, superior
    anti-corrosive technology
    No significant
    technological innovation.
    Advanced pivoting head. Smoother shave
    Pulsing feature(vibrating
    technology).

    MARKET SEGMENTS EXISTING

    BEHAVIORAL SEGMETS

    value

    32% volume
    22% dollar

    moderate

    43% volume
    44% dollar

    Aesthetic shavers

    Super premium

    25% volume
    34% dollar

    Maintenance
    shavers-un involved

    Social/emotional
    shavers

    39% non disposable


    razor users
    28% non disposable
    razor users
    33% non disposable
    razor users

    SYMPTOMS
    Segment positioning of clean edge razor:
    Niche segment
    Main stream
    Brand name positioning
    How to associate paramount to clean edge

    NICHE POSITIONING
    Pros:

    Cons:

    Positioning Clean Edge as niche will


    complement companys existing product
    portfolio perfectly.

    limited consumer base

    consistent profit margins


    risk involved in the form of cannibalization
    will be less.
    Less marketing expenditures-$15 million
    compared to main stream.

    the company may lose their loyal customer


    base which is there with Pro and Avail, who
    were used to non-technological products.

    MAIN STREAM POSITIONING


    Pros:

    Cons:

    Pro ,the main product was in the


    mature phase of the product lifecycle
    so there is a possibility of decline.

    There is the possibility of diluting the


    brand power leading to cannibalization.

    Technological advancement can resist


    the new innovative markets and
    competitors

    More marketing support will be needed to


    reach the target masses.
    The company would require an extensive
    advertising campaign considerable
    consumer promotions and thus the
    expenses will be huge, costing almost $42
    million

    Profit & Loss Statement


    Niche
    Year 1

    Unit sales Razors (millions of units)


    Dollar sales - Razors ($ in millions)
    Unit sales Cartridges (millions of units)
    Dollar sales cartridges ($ in millions)
    Total dollar sales
    Production costs - Razors ($ in millions)
    Production costs Cartridges ($ in millions)
    Capacity costs
    Advertising and Promotion ($ in millions)
    Total costs
    Operating Profit ($ in millions)
    Profits as % of sales
    Cost of cannibalization ($ in millions)
    Profit after cannibalization ($ in millions)

    1
    12.99
    4
    42
    54.99
    5
    9.72
    0.61
    15
    30.33
    24.66
    44.84
    19.2465
    5.4135

    Mainstream
    Year 2
    1.5
    19.485
    10
    105
    124.485
    7.5
    24.3
    0.87
    16
    48.67
    75.815
    60.90
    43.56975
    32.24525

    Year 1
    3.3
    36.927
    9.9
    88.011
    124.938
    15.642
    22.176
    1.71
    42
    81.528
    43.41
    34.75
    74.9628
    -31.5528

    Year 2
    4
    44.76
    21.9
    194.691
    239.451
    18.96
    49.056
    2.45
    39
    109.466
    129.985
    54.28
    143.6706
    -13.6856

    LAUNCH DECISION
    Launching in niche market :
    Lower cannibalization costs
    Lower advertising costs
    Although lesser profits compared to mainstream without
    considering expenses, after the above expenses niche will result
    in better net results

    Launching in super-premium segment and social/emotional shavers


    segment

    BRAND NAME OF THE PRODUCT


    The clean edge will be positioned in the name of
    CLEAN EDGE BY PARAMOUNT
    Reasons:
    Focusing product rather than company
    Differentiating from other brands and also Pro and Avail models helps in
    reduction of cannibalization

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