Promotion: Gillette uses many types of promotion and spends huge amounts of their money on this. As a result of this they have huge brand equity and are among the market leaders. They have huge and frequent TV campaigns using major celebrities such as David Beckham. The company also uses advertisements in magazines which would be read by their target audience as well as billboard advertisements. This form of advertisement have been hugely successful for the Gillette Company, everybody has heard and recognises their slogan, “Gillette, the best a man can get”. Other than these more traditional forms of advertising the Gillette Company uses many new marketing techniques.
Gillette is well known for sending a free Mach3 to males on their 18th birthday as a promotional tool. The idea of this strategy is to generate publicity for Gillette as most people will tell their friends if they get one. This strategy is a result of the captive price plan. Once the person has received their free Mach3 they will need to buy replacement blades, which can only be the Gillette Mach3 blades as no others fit the razor. There will also be an increased chance that they will also buy other Gillette products to use with their razor, gel or foam to shave with and so on. This is supported by a few quotes taken from Gillette’s marketing board on which people can post their thoughts on the web site.
“My dad got one a few weeks ago. It was from Wal-Mart - He didn't enter anything online...it just showed up in the mail.Mach3 is worth the extra bucks.”
(Posted by )
“Well, had Gillette sent me a Mach 3 Razor on my 18th they would have gotten many, many more hundreds of my dollars by now- it's a great razor”
(Posted by Hugh Macleod contact,gapingvoid.com)
Bruner then goes on in the article to state that “Marketing Fix reader Jon Gales just turned 18 and is impressed that Gillette sent him a Mach III for his birthday. He apparently doesn't realize the replacement cartridges for that razor cost a fortune. But sounds like they have won over one more customers anyway, and gotten all this free publicity to boot.”
(Gillette Wins New Shavers 1:1 at a Time Posted by 15 Feb 2003)
This form of marketing is known as direct marketing. The company will have a database of names and addresses that have given their permission to be sent information the company feels relevant. This is a very good form of marketing as shown above as it receives virtually no bad publicity as it giving the customer a product for free. It generates free positive publicity as well as capturing the person into the Gillette product range. If they like their free razor and want to continue using it they have to continue to buy Gillette products creating a new customer and increased sale possibilities.
Another form of marketing used by Gillette is sponsorship. They sponsor many initiatives around the world and below is a table of their most recent sponsored events/projects.
(Table taken from www.gillette.com)
Question 2:
Up until recently the Gillette Company and its competitors have not adapted well to the internet. They have continued to market their products through the more traditional mediums of television, newspapers, magazines and so on. However their products are of the type that are difficult to place on the internet, so as a result the companies themselves do not sell their products on-line. Other companies such as high street brands sell for them on their own internet site. This approach seems a little naïve and it becomes apparent that up until recently the companies in the grooming business has turned their back on new marketing tools in favour of their traditional campaigns that have brought them so much success. If a company wanted to challenge with Gillette they could have easily taken advantage of their lack of on-line marketing to gain a larger share of the consumer marketplace.
One of the first major internet marketing campaigns was by Gillette for its female razor, the Venus. The company has marketed on-line before using banner advertising and sponsorships. The Venus campaign was the largest online marketing campaign in the companies’ history.
The Gillette Company spent around 3% of its North American media dollars on this campaign. The initial part of the campaign focused on directing people to the products web site via banner ads. The latter stages focused in on sponsorships and partnerships with web sites that were used by their female target audience.
One of the main aims of the Venus campaign was not to increase sales, but to improve brand awareness. The company did not sell the product itself so could not really trace the success of the marketing campaign via that but hoped that potential customers would be able to recognise the brand easily. In an interview with iMedia, , Gillette's Interactive Manager for Grooming brands, spoke of the campaigns success, “We did not sell the product directly to consumers online, so we cannot be sure how sales were impacted. We did create our first e-tail module that we offered to online e-tailers, and that drove some sales on their sites. Our main Internet objective was to create brand awareness. To that end, we conducted a small research project to determine if we were accomplishing brand awareness and how many times our customers had to see a banner before they recognized the brand.” Brand equity plays a huge part in the consumer’s decision to buy. The points below shows what brand equity can do for a company (taken from )
Brand equity can provide strategic advantages to your company in many ways:
- Allow you to charge a price premium compared to competitors with less brand equity.
- Strong brand names simplify the decision process for nonessential products.
- Brand name can give comfort to buyers unsure of their decision by reducing their perceived risk.
- Maintain higher awareness of your products.
- Use as leverage when introducing new products.
- Often interpreted as an indicator of quality.
- High brand equity makes sure your products are included in most consumers consideration set.
- Your brand can be linked to a quality image that buyers want to be associated with.
- Offer a strong defence against new products and new competitors.
- Can lead to higher rates of product trial and repeat purchasing due to buyers’ awareness of your brand, approval of its image/reputation and trust in its quality.
All of these points can be applied and used by Gillette to their advantage over their competitors, especially as they already have such a higher brand equity and are already associated with high quality products.
also goes on to state that measuring the success of the on-line campaign was difficult due to it being run simultaneously to TV and ads campaigns. “The results were mixed. We got a good sense of the number of ad exposures a person needed to see to have good brand recall. Overall increase in brand awareness was difficult to gauge because we were running major offline marketing campaigns in parallel to our online efforts. It was difficult to determine whether we were building brand awareness through our online efforts. We also learned that partnerships/sponsorships out performed straight banner advertising.”
He then goes on to say that the Venus campaign will continue on-line but not necessarily to increase sales. He feels it will be more beneficial to use the project as a learning tool to allow a Gillette to find out about consumers on-line, “Because the Venus brand team wants to continue to utilize the Web to test and learn about consumers online. The focus will be on developing richer partnerships and sponsorships. We are working on the development of a strong viral component.”
Other leading brands in the grooming industry are following Gillette’s lead in their marketing strategies and procedures. Wilkinson sword’s Quattro razor is being subjected to an on-line marketing campaign similar to that of the Venus. Banners re-directing consumers to places of information on the new 4 blade system as well as companies selling their products.
All of the company’s web sites within the grooming industry have contact addresses via e-mail to allow the customer to contact the company quickly and efficiently. This is a small improvement in customer relationship management but more could be done to improve the customer’s experience. I will be looking into this in my next question, looking into how Gillette is the first company in their industry to “go live” with the new mySAP eCRM technology.
Question 3:
In this part of this assignment I will go on to look at the way in which Gillette is planning its future on-line marketing techniques. I will focus in on how the company is planning to use and improve its eCRM (electronic Customer Relationship Management) and implement RFID (Radio Frequency Identification) tags into its products.
eCRM:
The Gillette Company is currently applying mySAP to its German and U.S sales forces. mySAP is a form of eCRM and aims to “Shave off Low-Value time that Gillette's sales force spends on administrative tasks, thereby increasing productivity, creating a competitive advantage”
Gillette acts like most product producing companies and concentrates its efforts to directly contacting its customers. Gillette gives out its contact Information with all of its products to ensure a customer can contact them easily if there are any problems with the products. Currently the customer goes through to a call centre where the CCO (call centre operators) answer the caller’s questions via a Frequently Asked Questions system.
Quality assurance manager for Gillette, Jorge Cancellieri claims that “Product quality is one of Gillette’s critical business drivers.” With their new CRM system in place he believes that “complaints now become statistics the QA team can use to direct efforts on continuous improvement.”
Gillette sees its call centre as a “key component in the company’s marketing strategy.” It is employed to act as a customer interaction centre and they try to now employ a one to one customer relationship feeling.
Gillette, as well as many other companies, conducts huge studies in the name of market research to try to enable it to improve its products and services, usually based on customer’s views on the pros and cons of their products and services. However, Gillette is starting to realise that it already holds huge amounts of customer information which has been collected through its call centre. The company then uses this information for marketing strategies such as its free sampling strategy etc.
Gillette has many call centres around the world and tries to have one in every country that stock and sell their products on a large scale. In Argentina, one of the companies major manufacturers they have a call centre staffed by 2 employees handling approximately 1500 calls per month!
I would recommend to Gillette that they use the customer information they have gained through their call centres to a greater advantage. The customer information could be used to send MMS and SMS messages as a marketing tool to their current customers, offering discounts, free trials or just normal advertisements.
Mr Cancerlieri goes on in his interview to give examples of how the new eCare system (eCRM) has helped improve the handling of customer’s complaints and queries. He says that “When a consumer calls to complain that a can of shaving lotion is dispensing liquid rather than foam, the call centre operator accesses 1 800 Gillette, the e-Care system, if he doesn’t know the answer off the top of his head. Answers to frequently asked questions (FAQ) are stored in an online database that call centre operators access to provide accurate and consistent answers to callers. Having information at the touch of a button has reduced the length of the call from an average of eight minutes to about five minutes --- that’s close to a 40% reduction!”
The new system allows the call centre operator to direct a caller to the nearest store selling the required Gillette products. All though this may seem a trivial quality it adds value to each call and can also generate trends and patterns that managers of marketing campaigns can analyse to see where extra marketing is needed and create targets for future retail outlets. It generates a form of market research with very little extra cost or effort.
“Overall Gillette has found using the new technology has helped the company increase its responsiveness to customers and improve its internal communications.”
RFID tags:
It is claimed that RFID tags have been ordered by Gillette to be used in its supply chains and smart shelves to be used in retail stores. If these claims are true then Gillette will be leading the way in this new technology. RFID tags will allow Gillette to collect huge amounts of data on all of their customers. This would allow Gillette to create a huge database of all there customers and directly market their products towards them.
What is an RFID tag?
“RFID is the next generation of bar-coding technology. Instead of a series of bars simply printed on a label, an RFID tag is a miniature electronic circuit. The simplest RFID tag can be packaged in a label very similar to a bar code label. But instead of being scanned by a laser that must "see" the bar code, the RFID tag merely needs to pass near a specially equipped RFID transceiver. The transceiver bombards the tag with invisible radio waves, thereby activating the RFID tag's circuitry which transmits its information back to the transceiver. The tag is entirely passive: It doesn't need to contain a power source. RFID tags typically store a 64-bit unique code. A standard printed bar code such as a universal product code may store only 11 digits, but the 64 bits — roughly equivalent to a 19-digit number — allow for vastly more combinations.” (by , data warehouse designer, RFID tags and Smart dust, July 18th 2003)
RFID tags take advantage of a larger code storage which allows every piece of information to be tracked/ An RFID tag only needs to pass an RFID transceiver, all shop doorways will be equipped to allow detection of a tag passing through. For businesses involved in supply chain management are already tracking the movement of their products wherever they go, through the factory, on the vans. Each of these locations would be fitted with an RFID transceiver allowing the huge amount of information to enter a database for analysis.
In shops, the end of the supply, the RFID tag would make the shopping experience for the consumer much similar. The shopper could fill their trolley or basket allowing the RFID tag to send the signal for its detection in the trolley. The Customers credit card would then be sent a total and this would be paid upon the customer’s approval.
Not only would this help the company run their production lines more efficiently but it would also allow the Gillette Company to build up a huge database of customer details. These details could then be used to help the marketing department directly market their products to the consumers.
Interactive Digital TV:
Digital TV would be ideal for Gillette to advertise on. It is a mass medium and therefore allows the company to target a large audience. It has a high penetration level and impact rate but the problem with accuracy (getting the right people to watch your advert would need to be addressed. Although it is high cost, Gillette would be able to take advantage of the new interactive options. An interactive advert in which Gillette could involve their customers would be a great marketing tool. Asking the customers to press the ‘red button’ to allow interaction. They could then be able to order free trials, enter details in a competition(this would allow the company to gain massive amounts of consumer details, thus gaining marketing possibilities) This would also generate free publicity for the company as it is bound to be a talking point amongst friends and colleagues.
With the advances in technology it has become possible for companies to market their products to potential customers through direct e-mails rather than older more traditional methods of post. Gillette could use this to their advantage and send mail shots, offers and other marketing opportunities via e-mail and direct mailing. Through using new e-mail methods it is reported by What’s New In Marketing that a “company can save up to 30 times its cost on post etc whilst also gaining up to 10 times the amount of response in comparison to more traditional mail.” This would allow Gillette to save money and time when sending out mail to the consumer. On of the problems with their traditional mailing tactics are that it is often ignored and seen as an irritant. Obviously e-mail does suffer from this problem too but in a quickly adapting world people have began to accept e-mail and do not regard it as annoying. Even if the person does not open the email they will have been exposed to at least the company name or product within the title.
One of the problems with direct mail is that the company would have to gain permission from the person to be able to mail them. This could be tied in with the interactive TV as people who were interacting could be asked for their details and for permission. It is stated by Chaffey (2004) that “opt in email is key to successful marketing.” If the person has “opted in” to receive mail it is far more likely that they will read and engage with your email. This again would improve response rates.
Sending direct mail also has a very quick response time due to the regularity with which people can check their mail.
If Gillette were to use direct mail in their marketing strategy they could be virtually guaranteed to cut costs, improve responsiveness and save valuable company time whilst also gaining a higher level of exposure in their campaigns.
Bibliography
Rick E. Brunes
Gillette wins shavers 1:1 at a time
15thy Feb 2003
- Gillette goes live with mySAP
March 14th 2001
Walldorf, Germany
July 18th 2003
RFID tags and smart dust
Ralph Kimbell
- Interview with Gillette’s Chris Desrosiers
Feb 04 2002
Venus Razor Article
- www.dssresearch.com/toolkit/resource/papers/SR02.asp
